Our team has assessed thousands of buying processes - from point solutions to global full-suite rollouts at companies of all sizes and industries. We combined our experience with conversations we had with leaders from some of the top digital transformation firms in the HR Tech space and practitioners that have gone through this process - with failure and success. We found incredible consistency between all of the success stories and even more with the failures. While more than 80% of companies have undertaken digital transformation initiatives in the last five years, only 16% say these have successfully improved performance and equipped them to sustain changes in the long term
We have identified three key steps when buying HR technology: Planning & Building a Business Case, Evaluating & Selecting the Solution, and Implementation & Digital Transformation. All stages are essential to the success of the process regardless of company size, industry, or type of technology being assessed.
Today's blog focuses on Step 1: Planning & Building a Business Case.
The planning stage of the buying process is often overlooked but is essential for understanding why the purchase is being made, selling the project internally, and staying focused as the process unfolds. It consists of three main components: Identifying Business Needs, Being Clear on what Success Looks Like, and Understanding the Business Impact and ROI. This will help ensure that decisions are straightforward and that the project is successful.
Identifying Business Needs
During this initial information-gathering step, the goal isn't to focus on the technology or what you want out of the technology but rather ensure you understand the outcome you want. Look beyond your current process or technology limitations to your ideal state if you could create a "dream" scenario. Are you looking to simplify your payroll and get your employees same-day pay access? Do you want to improve your employees' mental wellness and retention? Is having better insights into your total workforce for your executive team needed?
Include people from other departments in this step simply by having conversations with them.
Be Clear on What Success Means
Success is different than the business impact or ROI of the technology, the timing for the "go live" of the technology, or the budget and is tied back to the initial business need to be solved.
If your goal is improving retention, your metrics for success may be tied to improving your employee engagement scores, making internal mobility and transfers easier, decreasing the turnover rate by X%, or gathering more information about why people are leaving.
Understanding Business Impact and ROI
At this stage, it is less about the cost of the technology you are considering and more related to how solving the identified needs will benefit your company. Sometimes that is a clear savings of time (overhead) or money. Often, it is assessed with a bit broader understanding of the impact.
As you evaluate different tools and learn more about them, ask vendors for clear specific examples of the solution's ROI. Nearly every vendor has these on hand and ready to share - don't be afraid to ask.
Some common areas to think about when looking at the business impact of HR Initiatives:
- Hiring - Will this make us an employer of choice, give us a differentiator, or help improve the hiring process, so people want to be part of our organization? Does it improve the candidate experience leading up to hiring?
- Engagement - Engaged employees impact productivity scores, customer satisfaction ratings, and patient outcomes at healthcare facilities have less turnover
- DEIB (Diversity, Equity, Inclusion, Belonging) - How does this impact our current workforce to support our DEIB initiatives or a broader definition of unique backgrounds within our organizations? This impacts our organizations' hiring, retention, engagement, productivity, and innovation.
- Retention - Does this help us retain talent, reduce overhead, save on hiring costs, improve employee satisfaction, etc.?
- Decision Making - Does this enable our teams to make more informed decisions to be more strategic around their talent?
- Time - Will solving for this goal reduce time spent on tasks that can be automated?