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Is Functionality the Most Important Key in HR Software Selection?

Recently, I watched an interesting YouTube interview on the “Firing Line with Bill Kutik” channel where Bill Kutik talked with Melanie Lougee, Gartner’s VP and HR analyst. They were discussing the results of Gartner’s survey on HR Software and the implications of SAP, ORACLE and WORKDAY software having very similar scores.

Melanie Lougee stated that the survey was carried out comparing a 1 to 5 point score attached to modules for each of the basic HR processes by the users of software products. She said, no standard measurement technique to measure the functionalities of each product against a certain criteria was applied, therefore this survey would not say anything accurate about “how  good” the products are compared to each other. She pointed out that potential buyers should identify their own requirements, compare the products’ functionalities according to those requirements, analyze the costs and then make their decisions accordingly.

I happened to see an old commercial by one of the retired mobile phone companies saying “You will be able to watch TV everywhere using your mobile phone.” The exaggerated mimics on the faces of players seemed funnier than ever to me thinking what a simple feature they were talking about. Furthermore, the fact that such an innovative company of that time just ceased to exist a few years later is another discussion point.

You may ask how the two paragraphs above are related with the issue of HR software selection. Any software selection involves evaluation of the functionality. Gartner’s survey was about measuring customers’ perception of functionality in leading HR software products. When I saw this old commercial emphasizing an innovative functionality, I thought it would be a good analogy to discuss “functionality” and its role in our HR software selection process.

Graham Bell invented the telephone in 1876. Within four years after Graham Bell and Thomas Watson talked over a wire, in 1880, around 70,000 people in 35 states in the U.S. were able to communicate with each other from their houses. This was a great functionality. Spreading of this functionality throughout the world, inclusion of wireless and satellite communication and expansion of the internet has taken this functionality so far, that people could talk, chat, make video calls and watch on demand TV anywhere in the world, even in the middle of a desert or a wild forest.

Remember, the basic functionality was two people talking with each other remotely. We still need that basic functionality, but with some additions, as you can imagine. Can we still use that first phone today and say we are happy with the functionality? If we sell that antique device at a good price and buy very modern mobile phones, yesJ. Just imagine what Graham Bell and Thomas Watson or the people around them would have said if they were asked about their satisfaction level of that device. I would assure you that their score would have been higher than the score that any modern man would give for a modern mobile phone.

The point is:

1. The satisfaction level of a user about any product is limited to what he/she can envision about the product.

2. Comparing the satisfaction scores of two different persons about two different products in two different environments does not say anything accurate about the comparison of those two products unless there is a standard, widely-accepted set of evaluation criteria used in the survey, especially on functionality.

As for the evaluation of HR software, there is no standard, reliable and officially accepted measurement methodology that I am of aware of, that can be used to compare the functionalities of two or more HR software products. All the surveys are based on subjective perceptions of the participants. If you decide solely based on the results of these surveys, then you are not making a wise decision, but you are just following a certain percentage of a certain type of crowd. Comparisons and the preference of participants will surely take you somewhere, but you will never know whether that choice is the right one for your case and requirements, especially in this cruel world of wise perception manipulations by marketing people. That is why I wanted to give you a brief list of things to watch out for if you are on the verge of making a similar decision:

1. First of all, you should have some knowledge of the subject you are expected to make a decision on. Answer this question to yourself honestly. You may need to consult reliable independent professionals to make better decisions.

2. Try to benchmark with successful organizations similar to yours in size and functionality. Analyze the functionalities they thought they needed. Learn which ones they really needed, which ones they wasted time and money on and why. Check if you can write similar success stories or make better ones. Try to determine if you need to aim for such a success story, first.

3. Analyze the maturity level of your HR processes. Determine the ones that needed improvement. Check how flexible your organization is to adapt to changes in your existing processes if the software requires you to do modifications. Try to determine the cost of those modifications, too, and then decide whether it will be worth the cost.

4. Try to locate every vendor that can meet your requirements, and meet with them. They will all give you different perceptions. Listen to them and adapt what they say to your situation.

5. Try to collect the following data about the vendors and their solution and try to assign scores to each of them in a standard approach:

• History of the vendor. Their experience and references especially about the functions/solutions you are interested in implementing.
• Future vision of the vendor. Their product and service roadmaps.
• The existence and success level of implementation projects similar to your case and scope.
• A sustainability/maintainability score that you may give to the products and services of the vendor.
• The flexibility of the vendor and the solution to your changing needs and requirements.
• The percentage of how much the vendor and the solution can meet your requirements in a single organically integrated solution (This has now become a consensus among many thought leaders and research companies in HR. Although it may seem attractive to buy a state-of-the-art, best-of-breed expert solution in a specific HR function, the cost of integrating and maintaining such a system of disparate applications is way above the intriguing benefits).
• The strength of the local support. This is not only a matter of calculating the payroll according to local legislation, anymore. The level of local customer support and the capability of all HR functions to adapt to local labor law and legislation are also very important. Especially for organizations that do not have that many very good English speaking HR professionals in all their country offices.
• Last but not the least, learn and evaluate the timing and the costs of customization projects before you make your decision, if there is a chance for your organization to require any customization in the functionality of the product or implementing extensions to the functionality of the product. This will also affect your and the vendor’s version upgrade processes. Try to understand the possible implications of such customization and/or extension work.
   

6. When you carry out your meetings with the potential vendors and evaluating their products, try to be as clear as possible about the following:

• Do not suffice with presentations over slides. Involve your people experienced with your organization’s HR processes and force them to ask detailed questions. Try to arrange workshops with specific scenarios. If the vendors cannot answer your questions swiftly, ask them to elaborate on their proposal for a project to completely fulfil your requests, or make your decision about whether you can use the product as is, adapting your current HR processes to the product’s functional coverage.
• Ask all your staff to come to the workshops prepared to ask questions, ask for modifications or accept the system as it is.
• Do not limit yourself with you and your staff’s knowledge or experience. If you think the vendor has more knowledge, know-how and experience about your needs, ask them to elaborate and try to learn from them. If you think their approach is better than what you are asking for, ask if they have any sample implementations. Try to do benchmarks with those clients.
   

7. Try to come up with a reasonable and implementable project plan. Do not start anything before you complete your own homework.

8. “Do not mistake slogans for solutions.” Try to analyze cool and easy looking applications in more detail.

It has been quite common for managers to decide and act fast, thinking that the competition is doing the same thing and the time is limited. This leads many managers to choose the applications that seem to be implemented faster. But if you are planning a long term career in this profession even if it is not in the same organization, your decision and its results are going to follow you everywhere.  I am sure the managers of the company that foresaw the TV functionality on the mobile phone are still thinking about what they did wrong.