What we have learned about those looking for HRIS Software

We scrutinized the HRIS software surveys that have been completed in the last few months and learned a great deal about HRIS prospects. We took a look at the following options: Payroll, Employee Self Service, benefit open enrollment and recruiting. We also took a look at what percentage of visitors selected either a purchase platform or a hosted platform.

We found that 50% of those who completed the survey indicated that an integrated payroll application was required. Those who did not indicate they needed payroll selected needing an interface from their HRIS HRMS application to their existing payroll application.

With ESS and BOE, we found that around 90% of those that filled out the survey indicated that these options were important. I found this interesting because during my work as a reseller, I found that many people were, in fact, interested in these options but that few, in my case, ended up purchasing these options. It may be that the many HR Information Systems prospects are interested in this feature until they find out the cost or additional consulting time involved in setting up these options. The results for those wanting recruiting solutions were slightly less; around 75%.

We also looked at how often someone marked the options required. Payroll software was obviously marked required almost 100% of the time selected. The surprise was with benefits open enrollment. A large percentage of those who completed the survey indicated that they had interest in benefits open enrollment but less than 10% indicated it was required. As opposed to 70% who said ESS was required or 80% who indicated recruiting was required.

The last field I would like to address is hosted versus purchase. We originally found that most visitors were selecting ‘either’ or ‘purchase only’ the vast majority of the time. We recently added text under this field highlighting the unique differences between the two options and we have now seen that 90% of the time visitors are selecting ‘either’ for the option. The other 10% selected hosted.

As we continue to generate more data based on the surveys, we will release more detailed information going forward.

HR Management Software Popular Features

Employee Management Software Industry Market Analysis

Since we published our website in February of 2009 we have been collecting data on those who have completed our HRIS Selection Tool surveys. I realized early on this data would be helpful for both our employee management software vendors and our site’s visitors for understanding which options and features of employee management software the market is most interested in. Each Quarter, we offer a comprehensive report for our HRIS vendors with statistics for each question we ask in the survey. Here’s a snapshot of the results.

100 to 500 Employees

Five most Popular Employee Management Software Features

Job and Pay History -86%
Ability to Track Review Scores and Review Dates -82%
Ad Hoc Report Writing -81%
Email Alerts -79%
Employee Self Service -76%

Five Least Popular HR Management Software Features

Integrated Payroll -55%
Benefits Interface -54%
Ability to log time online -53%
Succession Management -52%
Physical Time Clock System -32%

500 to 1000 Employees

Five most popular HR Information Systems features

Employee Self Service -93%
Benefits Open Enrollment -89%
Email Alerts -89%
Ad Hoc Report Writing -89%
Ability to import and export data -89%

Five least popular Employee Management Software features

Integrated payroll -60%
Training Management -62%
Succession Management -57%
Ability to log time online -51%
Physical time clock system -29%

1000 to 2000 employees

Five most popular Employee Management Software features

Job and Pay History -90%
Ad Hoc Report Writing  -87%
Ability to import and export data -88%
Employee Self Service -88%
Ability to track Review Dates -82%

Five least popular Employee Management Software features

Succession Management -66%
Integrated Payroll -65%
Training Management -63%
Ability to log time online -56%
Time Keeping System -38%

Over 2000 Employees

Five most popular Employee Management Software features

User Defined Fields -89%
Employee Self Service -89%
Ability to import and export data -85%
Ad Hoc Report Writing -83%
Job and Pay History -83%
Five least popular Employee Management Software features 

Training Management -62%
Recruiting -61%
Interfaces between payroll and HRIS -50%
Physical time keeping system -46%
Ability to log time online -44%

Again, detailed market analysis reports based on our HRIS Selection Tool are available for our site’s vendors. Email me if you have any questions, C.Scroggin@CompareHRIS.com.

Selling HR Software is Not Easy!

Selling HRMS software or HRIS systems is hard!

If you have been selling HRMS Software, HRIS systems or HR software for any amount of time, I am certain you will agree with most of what I have written here. If you are new to the industry, get ready for a lot of heart break. In fact, I challenge anyone to offer a product that is harder to sell than HR Management SystemHR Information Systems or HR Software.

I have been selling HRMS software, HRIS systems, and HR software for more than 15 years. Here’s the scary reality. I have seen that if I show a hundred HR managers an HRIS application, at least 80 will express interest in buying. At most, 10 to 20 will get the approval for purchase. Based on my estimated numbers, this means that for every 10 HR departments looking for an HRIS product only 2.5 actually end up getting the approval and buying a system. The intent of this article is to explain why this happens and what you as an HR software sales person can do to avoid the pit falls.

Why is selling HRMS Software, HRIS systems or HRMS Payroll systems so hard?

 You are not selling your HR software to the decision maker

More often than not, you will be selling your HRMS software, HRIS system or HRMS payroll product to the head of the HR department who will, in turn, sell to those with the authority to approve the funds. So to some degree, the success or failure you achieve in HR software sales will rest with someone else’s ability to sell your system. Welcome to HRIS system sales. Typical sales theory says you should, in this case, go directly to the decision maker. You can try, and you should, but it is important to remember that in most cases they are not the one with the direct need for a system. They are going to rely on human resources to make the determination of which product will work best for the organization. There is very little way around it; you sell to the HR department and they sell the concept to others.

Think about it.  In what other type of sales are you not selling to the decision maker? If you sell used cars, houses, or shoes, in all those cases you are working with the person with the ability to approve the purchase.

• Next to impossible to cost justify HRIS software

Selling anything often applies using some type of cost justification. I have seen some companies come up with detailed models that help to cost justify an HR software application. I have even worked on a few, but I don’t think they work very well. Frankly, too many of the estimated cost savings of an HR application are soft costs. Such as: each termination costs the company x amount of dollars.  So if through improved HR customer service and reporting HR is able to reduce the turnover rate from X to Y, x amount of dollars is saved. This may in fact be valid. The problem is ultimately your system will be sold to a finance or accounting person. I started out as an accountant. As an accountant, at least by education, let me tell you soft cost HR software savings will be a hard sell.

There are exceptions. If your HRIS or HRMS application includes in house payroll or a payroll hosted option that is less expensive than what the company is using, this is easy to calculate ROI. Recruiting systems are also easier to cost justify. If a widget company is paying X dollars to head hunters each year and you are able, with a recruiting solution, to hire ten percent more internally, there is a direct ROI statement that can be offered.

Yes, an HR system will save human resources a tremendous amount of time and benefit the entire organization but how much money is actually saved? Not an easy answer or an easy sale.

• Does the organization see enough value to invest in an HRIS system or HRMS software application?

When it comes to HR, in my opinion, there are two types of HR departments. There are companies that place great value on the benefits of HR and those that see HR as a cost center. It’s pretty easy to tell which is which. If you have a well staffed human resource  department run by a true HR professional, the company likely values HR and you will find you stand a far greater chance of getting approval than if you are working with an understaffed HR department run by more of a clerical HR person than a professional. If the organization has 700 employees and does not currently have an HR software system, why? The need is there. The benefits of HRIS are there. Have they tried to get the approval for a system before and failed? The company would benefit from a system, so why have they not as of yet added one? The longer you work in the industry, the quicker you will become at seeing which organizations value HR and which don’t. If the organization you are working with does not see HR as offering value, you will have a tough time getting the budget money for a new HRIS system.

What can you do to improve your HRMS software or HRIS system selling process?

Now that we have presented the problem, let’s talk about the solutions. There are steps you can take, to some degree or another, to counter the problems mentioned above but still you are going to lose deals based on what I have offered above. The important thing is to make sure you are working and winning the deals that can be won and not losing those deals to your competitors.

• Qualify, qualify, qualify…… Your HRMS software or HRIS software prospects.

Years ago I had an interview with a large payroll HRIS software company. The VP of sales told me that they felt they were only closing the low lying fruit and were not closing the harder sales. I told him, the low lying fruit was exactly what I was going to try and close and to find as many of those situations as possible. He told me he did not like the answer. I was a little terrified because I could not back down at this point. I told him “Sorry, but it’s the truth.”  If you hire an inexperienced HR sales person, they are going to work the hard deals and six months to a year down the road, they will determine that the low lying fruit is where the money is made in HR software sales. I received the job offer but turned it down to start my own company.

As I mentioned above, those companies that don’t see value in their HR departments are less likely to invest in HR software than those companies that value HR. Before doing the demo, working up proposals, providing references and working to close a deal, you need to try and weed out those companies who have very little chance of getting approval for a system. Most often this is a question of cost. Let the prospect know early on how much your system costs and see what the reaction is or ask them what their budget is for a system.

Qualifications are not simply based on cost. It’s also a question of what the customer is looking for and why they are looking. If you ask them what their needs are and they indicate they must have a system that offers an integrated payroll package and your product does not, this is not a qualified lead. If you ask what their needs are or what problems they are currently having and they can’t provide an answer, this should also be a red flag. The more you qualify the leads of the prospect up front, the less head ache you will save yourself later on. Work the low lying fruit. If you ask why they are looking for an HR system, you might receive the ‘I’m outta here answer’ of “Well, we just wanted to see what was out there”. Thanks; Elvis has left the building.

• Learn how to be a consultant and a sales person to sell more HRIS software.

HR people are not IT people. You are not going to sell the technology to HR. You are going to sell the results of what your system can provide. In order to do this, you need to solve problems. The consultative sales process is pretty basic. Find out what the client is currently using and what problems they are having. Ask what they need a system to do and then show that your product corrects these problems and meets their needs. The better you are at this approach, the more likely you are to win the deal. This last paragraph is extremely important; you may want to go to Amazon and purchase a few books on consultative selling.

• Involve as many departments as possible in the HRIS system selling process.

When going through the sales process and demos with a prospect, I like to involve as many others in the organization as possible to show that the system offers value outside of HR. An HRIS system that provides value to the entire company has a greater chance of being sold than one that does not.

If your product offers a training module, make sure to involve the training department. Involve risk management with FMLA, workers comp and OSHA reporting. If you offer payroll, it is obvious that you will involve payroll and accounting. If your system does not but will feed data over to payroll, this is still a benefit to a department outside of HR. Then, of course, there are the benefits to employees with self service or managers with manager self service. I think you are getting the point, an HR system that streamlines information for an entire organization will be seen as having greater value than one that only benefits HR.

• Tie the benefits of the HRMS software to the goals of the organization.

Find out what the organization or the HR department goals are and show how your product can assist with meeting them. How many employees is the company looking to hire in the next year? Do they want to decrease turnover? Do they want to decrease cost per employee? If you can tie the benefits of your HRIS product to the company’s goals, you again stand a greater chance of getting the deal.

• Gain access to those making the decision.

As I have mentioned, you will fail to accomplish this more often than not but it is still worth trying. When performing the demo, ask HR to invite the decision maker to the presentation or ask for a meeting with this individual to determine exactly what their goals are for HR and the organization. As long as you attempt this connection, with the blessing of HR, the results will be beneficial.

• Advancing the HRMS software or HRIS system sell

The most powerful question in sales and, especially, HR system sales is: “What’s the next step.” Throughout the process, you need to make sure you are moving in a forward direction to close the sale. I provided a summary at the end of each meeting as to what my and the contact’s deliverables were. The first thing to do at the next meeting is to review those items.  At the end of that meeting the “What’s next” question pops up again. If you find you have deals sitting in your pipeline for long periods of time, try this approach to see what happens.

Closing

I hope this was beneficial. If you have any questions regarding selling HR software products, don’t hesitate to send me an email or call me.

HRIS Software – Tips on Checking References

Checking References on HR systems in which you are interested is always a good idea. If  HRIS Vendors can’t provide references, or a reference provides a poor opinion of the HR software, that is certainly a red flag. Neither is likely to occur. HR Information Systems companies are only going to provide references who are happy with their particular HRM Software. They will usually call the client before providing their name as a reference to ensure they are willing to be a reference and that they are happy with their Human Resource software. The question then becomes, “How valuable are references if the HR software companies are handpicking them?” Here are a couple of tips to get the most out checking references when comparing HR systems.

Checking HRIS References Tip #1
Be as specific as possible with regard to which type of company from which you want a reference. This makes it less likely for the HRIS vendor to cherry pick the reference for you. It’s also important to note how a company in your industry has used the HR system to meet their needs. Who knows…. you might even be able to share tips with them going forward.

Checking HRIS References Tip #2
Search online to find out who is using the HR system and cold call them for a reference. The easiest way to do this is to go to Monster.com and type the name of the HR system in the keyword search. You will be presented with a list of companies who are looking for someone with experience with that HR system. If you are willing to do the work, pick out five and ask them what they think of the HRIS HRMS system. If you are going to try this approach, be sure to call a number of users since even the best HR systems have unhappy customers. Sometimes it’s not the companies fault, sometimes it’s the users fault, and sometimes it’s just Monday.

Checking HRIS References Tip #3
The ease of use and functionality of the HR software you choose are both the most important considerations. These can be determined by simply effectively reviewing, comparing and testing the products you are considering. Where I would use the references is to get an idea on support and problems during setup or potential bugs in the HR product. Ask the reference how often they call support and how long they are typically on hold. How helpful are the tech support people? Are they usually able to solve your problem? You also need to ask if there are any important problems or software defects of which you should be aware. Write out your questions before you call or email to make sure you don’t miss anything.

Checking HRIS References Tip #4
Make sure to not only ask for references on the Employee Management Software but ensure you have references on whoever is performing your HRIS system install. I would make sure that the person in charge of the implementation has, at the very least, ten HRIS installs of the exact HR software product you are selecting. Depending on the industry, industry experience may be needed, as well.

Overall, the message I am trying to present is that hand picked HRIS vendor references are only a small part of the steps necessary to successfully select an HRIS software application. By following the steps outlined above, I believe you can maximize the value of the references you contact.

User Friendly HRMS System versus Complexity & functionality

Is user friendliness important when considering a HRMS Systems or HR Information Systems software product? Absolutely! But only to the level that the HR Management System meets your needs.

For example, in the past I worked with a couple of HR Management Software both containing report writers but at completely different levels of ease of use and of complexity. The first HRMS system had the easiest report writer I have seen. It demoed well and users loved the fact that it required little, if any, training to generate basic reports. The other HRMS system’s report writer required training and database knowledge to create reports. This system did not demo well and, frankly, it scared clients. If asked, nine out of ten times most would have selected the first report writer; but there was, of course, a potential problem with that choice.

While easy to use, the first report writer had serious limitations. You could not group information, you could not add counts or totals, you could not create custom function fields in the report and graphing was not an option. If you wanted a simple employee list report without grouping or totals, this product met the need. If you wanted, however, to create a detail turnover statistics report or detailed compensation report it would not meet the needs. This is just one example of where the most easy to use Human Resources Management System system was not the best. My advice when reviewing HRMS software products is to make sure the system can create the most detailed reports you need created. Include in your needs assessment, the type and complexity of reports you will require and ask the perspective HR software vendor to show the process of creating those reports.

The ease of setting up the hr and Payroll software system is another important consideration. One product may be far easier to setup but require more work for you to maintain going forward. Often, but not always, the more detail the setup, the less work later to maintain the data.