What to consider before upgrading your HCM system
May 16, 2017
By Natalie B. Hoffmann, CPA.CITP HKP President
With the fast-paced advancements in technology, you have no doubt been offered an update to your human resource information system (HRIS) by your outsourced payroll processor. But, if you’ve ever thought about researching other options, don’t immediately sign on the bottom line. If you’re getting the pressure to upgrade your human capital management (HCM) system, it is the perfect time to shop around and see what you could be missing. If you are going to have to go through an implementation process with the upgrade anyway, it is worth researching other options that can provide the solution you need.
Sometimes a payroll processing company will change their software and require you to upgrade; other times, your system may not be able to access key compliance and tax law updates without being on the latest version. Before you buy the upgrade, ask yourself if the current HCM system is meeting your needs and if the upgrade will help or hinder your processes.
Key factors to consider when facing a HCM system upgrade or new system
Ease of use – Does the upgraded HCM system allow you to automate any processes you are currently doing manually? If your current system still has you working across another platform for time and/or one for HR/benefits, it may be time to consider a solution with a single sign-on database to eliminate those redundant steps. Make sure the upgrade is going to make your life easier.
Transparent pricing – Is the true cost of the upgrade clear? Make sure you know what you are paying for and what you will receive with an upgrade.
Customer service – If you are on hold for hours with your current payroll processor and struggle to get help from someone who you feel actually knows your business, it may be time to switch. Having to educate a new rep on every call is a waste of your valuable time and resources and likely not worth the upgrade cost.
Value-added services – Does your current provider offer access to value-added services like human resources consulting? With today’s changing HR compliance laws and workplace culture, an outsourced payroll processor who cannot offer solutions for your HR or benefits questions can force you to seek help elsewhere at an additional cost.
Return on investment – Will the upgrade return anything to you, whether it be time or efficiency? Your ROI is likely the biggest driving factor in deciding whether to invest in an upgrade. Break down the pricing, time and resources spent on your current provider and what will change with the upgrade.
Components comparison – Is there a component of your current system you are really struggling with? Ask for a live demo of an upgrade or a new system to see if the interface functions how you want and if it provides a more pleasant experience for you and your staff. If you’re spending a lot of time in your HCM system, how it works, looks and functions is important to your overall efficiency.
Any time you are facing an upgrade or considering a new system, make sure they offer a minimum of three value-added components; essentially, you want to walk away with three wins from the changeover. Whether that be ease of use, HR consulting or customer service, you should be gaining from the experience.
Additionally, make sure you ask questions. What does the pricing structure look like and are there any hidden costs? Can the upgrade or the new HCM system handle your specific needs? Bring examples of customized reports you’ve received from your current processor to the potential new provider meeting, and get a confirmation they can provide the same results. Or, talk to them about an issue you’ve had in the past with your processor and see how they would solve it.
When an upgrade is inevitable with your outsourced payroll processor or HRIS provider, it pays to do your research and validate that any additional time and resources put in are worthwhile.