HR organizations are facing competitive challenges on several fronts attracting top talent, developing a workforce for the future, and providing strategic insight to the business. These challenges are intensified by the demands of digital transformation efforts happening across the enterprise. To support the success of these transformation efforts and to become a strategic partner to the business, HR needs to quickly modernize processes and acquire new capabilities to infuse efficiency and effectiveness.
In recent years, HR organizations have embarked on a digital transformation journey, starting with the replacement of core systems. Core HR technology systems – also known as HRIS (human resources information system), HRMS (human resource management system) or HCM (human capital management) – store necessary information about an organization’s employees to be used for payroll, benefits, training, time tracking, worker eligibility requirements and commonly integrates with systems for applicant tracking/talent management, workforce planning, and learning management. Since the core system is the centralized database for employee information and data from other systems, the data must be treated carefully in the system replacement process.
In the last decade, the HR technology market has improved dramatically. HR technology has brought automation, AI, VR/AR, and innovative tools to HR functions such as recruiting, employee engagement, performance management, and learning and development. Organizations recognize the availability of these dynamic tools and are investing in the right technology to address complex business challenges. A major investment in the last few years has been HR core systems. Many HR organizations have already taken the step to replace core systems as part of the digital transformation journey.
While the majority of organizations embark on a system replacement effort to acquire new capabilities, many are missing the opportunity to unlock the full potential of these modern systems. Due to a lack of deep technology expertise, HR organizations tend to rush their replacement project. This is due to the sensitive nature of the data collected in the HR systems, and the pressure to quickly implement core systems since they affect many systems downstream. This bias toward speed often leads to shortcuts in the system implementation process. It also lends itself to a preference of working with vendor partners who are more focused on bringing HR systems to go-live as quickly as possible. The combination of a generic and fast implementation process with a partner incentivized by reaching the finish line has contributed to a growing number of HR organizations having to repeat core system replacement.
Since the capabilities provided by HR systems in the market are comparable to each other, what differentiates the level of functionality an implemented system provides over another depends on the implementation process. Also, the method of the implementation depends on the selected partner since this typically goes hand in hand. The two types of implementation partners that organizations usually work with are a software vendor partner and a client partner/outside consultant. Each partner will determine the depth and breadth of the implementation process, how quickly the system will go live, and determine if the system will meet the needs of the business.
Although selecting a system implementation partner may seem arbitrary, what a vendor partner offers can differ substantially from what a client partner provides. Organizations should choose a partner based on the level of industry expertise the partner offers, the breadth of knowledge the partner has in the required technology tools, and the diversity the partner brings in system replacement experience. The table below provides a view of the comparison between the two types of implementation partners.
Figure 1: Differences between vendor partner and client partner
FACTORS TO ACHIEVE A SUCCESSFUL SYSTEM REPLACEMENT
Replacing core systems is a significant endeavor within an organization and requires not only a monetary investment but also the commitment of time and resources. For this reason, it’s important to ensure the success of the system replacement project. Three crucial factors of success are workflow and process optimization, data cleansing and data quality, and implementation partner.
1. Workflow and process optimization
Don’t want to repave the cow path
Need to understand the processes that will go away and how the new system will handle other processes
Configure the system with the new process workflow that will support future business
2. Data cleansing and data quality
Know the types of data that can be collected and where the data is coming from
Clean the data
Build integration points so data can be pulled into the system as necessary
Understand which data is required
Transfer cleansed data to a new system
3. Implementation partner
To truly leverage the innovation in modern systems, HR needs to configure the system chosen with a partner who understands the clients business and the needs of the organization going forward.
PUTTING SPEED OVER QUALITY IS DETRIMENTAL TO DATA
Organizations have been replacing or modernizing their HR systems in the last few years to gain new capabilities to address HR challenges to compete for talent and build a robust workforce for the future.
The trend has been to replace core HR systems, expecting the new platforms to provide the robust capabilities necessary to advance the functions of HR so they can provide strategic insight to the business to make critical decisions.
With little knowledge of technology and trust in the capabilities, functionality, and strength in the vendor market, HR systems replacements have mostly focused on the speed of implementation.
Organizations are relying heavily on the software vendor and the vendor’s partner to guide them after their HR system implementation, that it’s up and running correctly, and that they have all the promised capabilities at their fingertips.
In relying on the vendor, their implementation process, and when the implementation of the HR system goes live, there are several possibilities organizations are missing. They are missing opportunities to:
Optimize their current processes,
Analyze, cleanse, and understand their data
Establish the proper change management procedures to ensure successful adoption
HR systems touch many other systems in your organization that contain very sensitive data. Organizations need to take the necessary time to complete a needs analysis, gather requirements, perform an RFP, and conduct research of outside consulting firms that can execute an implementation.
When implementation is done right, organizations are better equipped to execute their HR functions effectively and be the strategic partner that their business needs.
At PredictiveHR, our experts can help you optimize your core HR systems to help meet your talent needs while maximizing the productivity of your current workforce. Schedule a demo with us today.