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Is it time for HR Digital Transformation?

One of the companies we associated with had well-established processes and tools meant to digitise their day-to-day activities. Yet (not very surprisingly), we found gaps during the initial investigation (understanding the gaps between what is presently available and what is required for growth).

Investigation revealed the tool was not robust enough to manage the operations of the company, which were led and defined by processes or policies. What you, as a decision maker in a company, need to understand is that “one size fits all” is not applicable in terms of software. While any software can increase efficiency and provide transparency, it could be limited based on the services it provides. Keep in mind that the software you select today will define the company’s operational efficiency for the next few years; lift and shift is time and resource intensive.

One of the reasons family businesses start looking for HR software is to automate all processes that are time-consuming and interdependent in nature.

Our extensive experience working with various businesses over the years should benefit you as decision-makers.

Software selection is not as simple as you may believe. Ask yourself, as a business owner, first, “Why do you need HR software?” The need typically arises either because there is a problem or because you anticipate having one in the near future. So, to begin with, you have to recognise your problems or gaps and prioritise their resolution, and that becomes your requirement.

How do you do it?

1. Recognise pain points and define

This is not guesswork. List and define persistent and recurring problems that may be solved with automation. A pain point is a difficulty that is preventing your business from experiencing positive growth. It could be simple or complex and difficult to identify.

2. Prioritize

Determine the severity (the impact on business). This goes without saying, but the pain point with the highest severity would need to be immediately looked at and resolved.

A quick tip, not every persistent problem would need a high priority or critical tag. Sometimes those rarely recurring problems can have much more impact on business. This exercise needs to be carried out keeping the above in mind.

A way to look at the issue.

  • High: If we do not fix this, this is going to continue consuming man-hours.
  • Medium: There are a few barriers to efficiently executing a task. It impacts overall performance.
  • Minor: The process is tedious but not chock-a-block. This could be revisited later.
3. Foresee the business challenges

As a decision-maker, you should anticipate challenges while keeping the company’s goal in mind. Regardless of what the goal is, it is vital to build a strong process surrounding operations and reduce man-hours spent on carrying out day-to-day operations, etc.

Running a risk management exercise from time to time helps figure out the scenarios most likely to occur and the potential outcomes of those situations. Put your thinking cap on and brainstorm ways you can reduce the risks. The solution could be revamping a process, automating it, eliminating flows, etc. Identify how HR software can possibly help resolve it.

One would eventually see that the points mentioned would become criteria for the evaluation of the software.

4. Designing credible evaluation criteria

Following the identification of challenges,

  • List the existing operational process and every task/flow within it.
  • List down ideas (already planned) to revamp the processes to make them efficient and effective (risk analysis is a good way to go about it)
5. Identifying potential vendors

With requirements determined already, you can now start the search for HR, from searching the internet to speaking to known business associates in the same industry. Make a list of possible vendors and narrow it down to a few to approach.

How to evaluate a software?

Demonstrations on an actual scenario (an existing process) are the best way to evaluate a software’s capability. While your top consideration for evaluation should be how easy it would be to “Lift and Shift,” we advise you consider the below points as well.

  • The majority of software packages on the market now provide a somewhat comparable solution; what you should consider is how much it can accommodate the current processes. Simply put, can it effectively alleviate your pain points?
  • Note the manual involvement that is required. If it does not save at least 50% of man-hours, it is probably not the best option.
  • Their (the vendor’s) ability to meet feature demands. Company operations and processes are always changing, and as a result, the module would also need to be adjusted. Choose a tool or vendor that is amenable to criticism or has ideas that can eventually be put into practise.
  • While automating current operations is a key prerequisite for implementing HR software, consider what else it might provide that you might employ in the near future for the company’s advantage.
  • Ensuring that the software we choose has prompt customer service.
  • Choose a vendor who believes they can bridge the gap between idea and reality.

Making a wise choice from the many software options is a significant undertaking in and of itself, but there are still many steps to take before the system is configured and ready for use, which we will cover in our following post.


Senior Associate Consultant
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