In recent years, the usage of online HR applications and subscription models has been on the rise. While these systems can appear attractive for automating and streamlining processes, it's essential to evaluate their practicality and effectiveness. Choosing the right system requires research and careful consideration so that you are not faced with surprises down the track.
Getting a new system is a bit like buying your dream house. The sales and marketing can lure us in but it is the work you then do that helps determine whether it will be your dream house, or a house of horrors!
Here is more about what to consider. If you have a system already it might give you some pointers of what to check on. If you are thinking about a system you can use this to help you in your planning.
Clearly define your requirements – decide your why
Before assessing any system, it's crucial to be clear about how you want that system to help – you don’t opt for a credit card when it is a loan you need to manage costs!
Many businesses opt for HR applications or systems to consolidate records and automate processes. However, it's important to determine if the system allows easy searchability of records and whether your managers would embrace and utilise the automations effectively.
As an example we needed to check for a client recently how many staff had a particular term in their employment agreement. In their system we had to go person by person and that involved going into the system, to the persons documents, finding what we needed and downloading it before we could even search. Had that been on a desk file like One Drive or Google Drive we could have used search and likely got everyone’s information in one go.
Also consider if you will use the automations in practice or if they will they become just another email to deal? Some applications can turn into expensive filing systems, creating more work than anticipated due to complex set-up processes, extensive training requirements, or lack of user-friendliness.
By defining your objective and purpose you will ensure you are not caught in the hype of the application or someone else’s excitement about what it can do.
Assess what more the application offers
Consider what your current systems can already do. For example, if you have a payroll system in place, it might offer functionalities for reporting and managing leave. Your payroll system serves as the source of truth when it comes to leave entitlements, balances, and compliance with law.
Additionally, explore the possibility of using familiar tools like Adobe or DocuSign if electronic signing of documents in your employment processes is the outcome you are after. Optimizing the use of these resources can save costs and simplify your HR operations without having to invest in other systems.
By leveraging your existing systems, you may find that with a few tweaks, you can set up what you need in-house. If this isn’t your area of expertise you can engage the help of an IT provider to assist you in setting up permissions and secure storage, providing you with an in-house system that does what you need.
Utilise your templates and storage:
Some HR applications claim to be one-size-fits-all, but it's crucial to evaluate their suitability for your operations and your values.
Basic templates may not add value in practice, and employment agreement templates adapted from other countries might result in unintended consequences or lack necessary protections. Consider who has control of the templates or agreements, do you need to request an agreement each time you want to make a new offer and what is the time delay and extra costs for this? Can templates or agreements be adapted if you need to make a specific change or will you only receive a PDF version?
Additionally, explore how easily you can extract and export your records and documentation from the application. Understanding these processes will ensure compliance with the law and provide flexibility if you ever need to change providers or stop using the application.
Consider additional costs and potential issues:
When considering an HR application, it's important to consider factors like contract length, costs for writing custom reports and exporting your information, the stage of development of the application, notice periods for cancellation, and possible future price increases. Some providers may offer incentives to quickly increase their subscriber numbers but could potentially raise subscription prices significantly later on. Additionally, be aware of charges for additional services like drafting offers of employment or exporting performance reviews and templates.
Knowing your exit strategy is also important. Some only allow you to export personnel files person by person and templates in PDF format only – consider the timescales to do this if you were to change provider or stop using the application. Also consider the impacts of having all your templates in a pdf format.
Protect your information:
The security and protection of your business and employee information should be a top priority. New Zealand's privacy laws specify strict guidelines, and compliance is essential. When evaluating an HR application, ensure that the software supports your ability to manage data as required by law. Recent cases, like Latitude Finance's breach, highlight the importance of data protection. Safeguarding sensitive information and adhering to data retention requirements ensures the trust and confidence of your employees.
Leveraging technology to enhance business processes and cost management is advantageous. Proper planning is key. As Benjamin Franklin once said – by failing to prepare, you are preparing to fail….
Try not to get caught in the marketing hype, keep your eye on what you need your outcome to be and ensure that this is achieved. By following these recommendations, you can make informed decisions and select an HR application that best aligns with your needs, goals, and provides room to align with your company values.
Remember, our team is here to offer support and guidance as you navigate these decisions.