How to make a better HR tech decision
The result of buying the wrong human resource software can be costly. But HR execs can avoid many of the purchasing pitfalls, according to Ben Eubanks, the principal analyst at HR research and consulting company Lighthouse Research & Advisory. Eubanks spends much of his time studying emerging trends and technologies. And, early in his career, he worked as an HR director at a technology start-up company. Eubanks spoke recently with Employee Benefit News. Edited excerpts of that conversation follow.
Employee Benefit News: In your consulting work, do you find that people often are looking for a technology solution to a problem they really haven’t fully understood?
Ben Eubanks: Yes, that happens a lot. It typically happens when someone tries to implement the technology to solve a process problem. If your process is broken and you try to solve it with technology, I always say you’re just going to be much more efficient at doing the wrong thing. So when I’m having that technology discussion with someone that’s trying to find a solution, I want to get deep into the underlying process that’s involved.
EBN: Can you elaborate on that?
Eubanks: Sure. We need to figure out how the underlying process works, and does it meet the objectives, and if so, how to simplify and streamline it. Only then do we start looking at possible technology solutions and at which vendors can help. Sometimes an employer went in thinking they needed a whole big suite, A to Z, but after examining the process, they realized they could spend less and buy a smaller solution.
EBN: What kind of processes are typically the ones that they’re trying to fix, one way or another?
Eubanks: It ranges widely. It could be leadership development, career planning, onboarding, performance management — all of the things companies struggle with. Typically, when smaller companies are acquiring technology one of the first things they buy is usually an applicant tracking system, then they’ll move to a learning management or performance management system, and they start moving up this latter. Enterprise companies usually already have one of everything or multiple of everything, and they’re trying to keep all the data together.
EBN: How do employers find out about new HR technologies?
Eubanks: One of the most common ways is by phoning a friend and asking them what technology they’re using for a particular process. Then they use that as their starting point for their research, and use tools like Amazon reviews. It’s good that they’re making comparisons, but they need to be careful.
EBN: How so?
Eubanks: The problem is that vendors can usually buy their way on to lists that come up when you do an Internet search. So while the research is easier in some ways, some of those information sources are not completely credible. You can get led down the wrong path because a vendor has a $20 million marketing budget.
EBN: Let’s assume a buyer sees past that. What other research pitfalls have you seen?
Eubanks: In some areas of HR technology, even the naming of a system can really affect how a potential buyer will see it. For example, a vendor might call its product a “recruitment marketing system,” but it just might be an applicant tracking system that will let you create a landing page. It won’t do all the other core functions of a recruitment marketing system, such as email marketing, social marketing, employee advocacy or other things. And so people who don’t know better get trapped by a product name. They don’t ask the right questions about a system’s capabilities.
EBN: Do you have clients who are trying to work with enterprise systems that were purchased by another department, like finance?
Eubanks: Yes, but it doesn’t always end badly. I’ll tell you two stories. This once happened to me when I was working as an HR practitioner. Our payroll team was driving the software purchase decisions and they picked the technologies that they wanted to use and the vendor said, “Hey, we’ll throw in the HR stuff for free.” That should have been a red flag. When I started checking it out and asking questions, the vendor said, “You can cut and paste all of your performance management information here.” So I asked, “Can I search it?” and the answer was no, as were other answers to my questions. It was very limited.
EBN: But it was “free”…
Eubanks: Yeah, it cost me in headaches trying to work around that.
EBN: And your second story?
Eubanks: Last year I was meeting with the head of HR technology at a large financial services company. She told me her company was using a specific HCM suite when she applied for the job. On her first day, she told her employer, “My first order of business is we’ve got to get something different for our recruiting system. We’re trying to be an innovative, technologically sophisticated company, and it embarrasses me to see the system’s interface because it’s not cutting edge, it looks dated.” And so, despite their having already budgeted and paid for a recruiting solution, she was able to navigate and secure additional budget to buy something else because she presented a strong enough business case.
EBN: That’s a great story, but not a common one.
Eubanks: That’s true. She was in a good bargaining position because she already knew what she wanted to do before she was offered the job. At the same time, for other people, just because you’re stuck behind someone else’s [technology purchase] decision, that doesn’t always mean that you’re forever stuck there.