There comes a time in any businesses lifecycle that growth will push the constraints of any inadequate manual pen and paper HR Software System.
In a recent analysis of HR Software buyers conducted by Software Advice, an online resource for HR technology, it was discovered that 40% of the 385 willing participants were still using traditional manual methods to input their HR data. Pen and paper along with Excel and Email are still prevalent practices amongst many SMBs in the US.
Little over 20 years ago only medium and large sized companies could afford highly expensive Human Resources Systems. In today’s business environment most companies not only need a human resources information system but can afford it as packages can be tailored to an individual company’s internal requirements and budget.
Manual Data Input – Time for Change?
The problem with manual data input is that it is difficult to integrate across departments without communication gaps appearing. As the workforce grows this becomes a serious issue and decreases efficiency at every level.
It was discovered that those 40% still using manual data input were researching HR Software for the first time. Although 22% were using a combination of manual input and software of some form they still see the need to cross over to a fully automated HR Software System.
Despite the fact uptake for HR Software had been slow for those using manual data input methods, it is now clear that HR professionals are now adopting these systems increasingly in the small to medium business sectors.
The time saving effectiveness and efficiency of HR systems such as Time and Attendance Software can be directly attributed to higher operating income growth for the adopting company.
Buyers’ Current HR Methods
BEST OF BREED VERSUS INTEGRATED SOLUTIONS
When it comes to HR Software Solutions, choosing from the vast range of applications readily available can be a daunting task for any professional. Sourcing best-of-breed applications versus purchasing an integrated solution from a single software supplier can be a challenging decision that has to be made.
In the recent analysis of HR Software buyers, it was identified that 56% of all participants researched best-of-breed applications with 41% choosing to opt for integrated applications from a single seller.
The analysis also disclosed that 33% of those seeking best of breed applications were in fact looking for an Applicant Tracking System (ATS) with a further 20% requesting a Time and Attendance System. The third most popular product was performance review Software with 11% of potential buyers seeking this application.
HR Software Buyers’ Integration Requirements
The first time buyers main concern prior to Software evaluation was the growing amount of time spent inputting data and retrieving it across departments. Their goal with a new system is to improve efficiency with everyday tasks that were traditionally part of a manual and difficult to manage system.
Other reasons for evaluating HR Software Systems to replace manual systems included: the many benefits of automation, company growth and the financial savings made for the company.
Reasons for Replacing Manual Methods
EXISTING SOFTWARE USERS – WHY CHANGE?
Concerns arising over existing software been too complicated or not performing satisfactorily have been cited as major bugbears for users. 44% of existing software users also stated that lack of functionality was the main reason they were looking for a HR system that was more suitable for their requirements.
Updating or modernizing older or out dated systems was an important reason for HR professionals to reach out for newer and more reliable systems. HR Systems are now needed to include features that weren’t commonplace a few years ago. An example of these new features is social media integration where a job can be posted across various social networks.
Reasons for Replacing Existing Software
WEB BASED SOFTWARE
When it came to choosing the platform users wanted the Systems to run on, 77% of participants chose a web based software enabling them to avail of all the benefits of cloud technology. Interestingly only 3% preferred an in-house system. For those favouring web based software, it was noted that the ability for employees to login at remote locations was a prerequisite before any investment in new HR systems could be made.
HR SOFTWARE BUYERS’ DEPLOYMENT PREFERENCE
SMALL TO MID-SIZED BUSINESSES – TIMEFRAME FOR IMPLEMENTATION
Although the research covered a wide array of business sizes and revenues, the vast majority were made up of 1-250 employees. In fact 67% of those participants involved in the research fell within this company size demographic. Only 10% had employee levels between 500-1000 with less than 4% with levels over 5000 staff.
Looking deeper into the annual revenue of the participating companies, it transpired that 75% of them reported revenue of between $1- $25 million. Only 1% of companies had revenue in excess of $500 million.
Demographics: Buyer Size by Number of Employees
In today’s modern working environment it has never been more crucial to monitor the ever evolving ‘always on’ workforce. Researching and purchasing a HR System is an important decision that needs serious thought and evaluation. The research carried out by Software Advice has given us great insight into the evaluation process of small to mid-sized companies in the US when it comes to purchasing Human Resources Software Systems.
Original article by Erin Osterhaus – Software Advice