HR professionals in small and mid-sized companies face increasing responsibilities but now have access to affordable cloud-based HR solutions previously only available to large enterprises. These solutions can help HR take on a more strategic role through features that consolidate HR tasks and provide people analytics insights. While exciting, selecting an HR solution requires identifying needs, planning, and staying focused on core functionality rather than flashy extras. Ongoing support is also important to choose a stable, experienced vendor.

1. Big Needs, Little Budget: Look to the cloud
HR professionals in small and mid-market companies are tasked with an increasingly complex and broad
list of responsibilities. Fortunately, HR technology has evolved over time as well and small and mid-
market companies now have access to affordable solutions that deliver enterprise-level functionality. The
cloud is here to stay, enabling companies of virtually any size to leverage the power of a human capital
management (HCM) solution to successfully navigate the challenges they will face in 2015 and beyond.
The Evolving World of Human Resources
Historically, the role of the HR department has been to serve primarily as a back office, support function
controlling the administrative, payroll and compliance tasks associated with managing personnel. In
response to the significant changes within the workplace over the past decade – among them being an
economic recession and recovery, changing demographics and rapid technological advancements – HR is
taking on a more strategic role as a business partner for the various departments or units within an
organization.
This is an exciting time for HR professionals as they near closer to earning a seat at the executive table.
At the same, time, it also is an extremely challenging time trying to balance all that has been piled on
their plate.

2. Today’s HR professional is tasked with the monumental responsibility of shaping the organization’s
culture and driving the business plan for the future while ensuring the day-to-day, mission-critical
functions are completed efficiently, accurately and on time.
A recent poll by HR Daily Advisor confirmed that employee management, company policies and
compliance, and recruiting activities still take of a majority of U.S.-based HR professionals’ time. While
essential requirements of managing a workforce, these activities decrease productivity and hinder HR’s
ability to play a bigger role in the organization and assume responsibility for critical areas that directly
impact a company and its bottom line.
Adding to HR’s mounting pressures are: an increasingly complex and ever-changing regulatory
environment; a fiercely competitive job market where job seekers now have the advantage; the
entrance and domination of the Millennial population (and their “whenever/wherever/on-demand”
expectations) in the workforce; the huge responsibility to attract, engage and retain top talent; and, the
realization by company executives that HR is the keeper of critical data that can provide deep insight
into the company’s past, present and future (i.e. people analytics).
These challenges are making HR professionals feel overwhelmed, frustrated and tired. It also has made
them realize that it’s time to take advantage of the technology available to help position the function
more effectively.
The HR Professional’s new Best Friend
As the role of an HR professional continues to evolve, it has become abundantly clear that the ability to
adapt and constantly look forward is critical. What is also clear is that manual HR processes no longer
have a place in any organization, big or small. Not only are manual processes more likely to result in
errors and inaccuracies, but also they thwart productivity and efficiency. Enter the human capital
management (HCM) solution – the HR manager’s best friend.
An HCM solution links an organization’s strategy to its people, combining planning, recruiting, hiring,
onboarding, communication, benefits, payroll, time and attendance, performance, training and
employee data. It can quickly become one of the most important tools an organization has for managing
talent, strategic decision-making and overall company success. It appears more and more companies are
coming to this realization as recent industry estimates value the HR technology industry at more than
$15 billion.
According to recent survey by Towers Watson & Company, 1 in 3 companies planned to spend more in
the coming year compared with the previous years. Twenty-nine percent were going to spend money on
a new core HR system.
There are a few reasons for this recent surge in spending:
1. Organizations that have cobbled together myriad point solutions are looking to replace those systems
with a single, integrated HCM solution that have become readily available.
2. Companies have outgrown their current solution or want to replace it due to product or service
deficiencies.

3. 3. Cloud technology has made HR technology – once reserved for larger enterprises – affordable for
small and mid-sized organizations.
The last one – the move to the cloud – is perhaps the most significant trend to take place in the HR
technology arena over the past decade. Forty percent of the companies in the Towers Watson report,
who indicated they would be purchasing an HR solution, stated they were only considering cloud-based
options. Industry analyst, Gartner, estimates that by 2017, more than half of all HR systems will be “in
the cloud” versus on-premise.
What’s so great about the cloud? For one, the cost – it is lower and more predictable than an on-
premise application or multiple point solutions. The majority of providers offering HR solutions delivered
in the cloud do so on a per-employee-per-month (PEPM) basis, enabling companies to more easily
budget for the expense. While implementation costs vary by vendor, overall the cost to implement a
cloud-based HR solution is significantly less than an in-house solution and will require minimal internal
IT resources.
Cloud technology also offers organizations the ability to work in real-time with instant access to the
application and the data it stores. Mobility, or the ability to easily and quickly access information from
multiple devices, is more easily accomplished through a cloud-based solution.
And because there is a single instance of the solution, delivering new features and functionality is
significantly easier and faster, which means users will have access to the latest technology more quickly.
Before you Head for the Cloud, consider this
If you are reading this article, chances are you have been tasked with evaluating and selecting software
at least once during your career. If that is the case, you know it can be a daunting task, especially in a
market such as HR technology were there are more options than you can imagine. If you’ve never had
the pleasure of choosing a software solution, buckle your seat belt. Seriously, although it can be a time-
consuming and overwhelming process, if you keep the following considerations in mind, it should be a
more pleasant and successful experience.

4. Identify, understand and document your specific needs and requirements. Here are a few questions to
ask:
• Are you looking to change culture or simply establish more efficient processes?
• If you are changing culture, what are the business directions and organization objectives driving the
culture change (growth, diversification, competition, etc.)?
• If you are looking for efficiencies, where is your focus? HR? Employees (self-service)? Managers (self-
service, reporting etc.)?
• Are you interested in outsourcing part or all of your HR functions?
Have a defined project plan that has executive/senior leadership buy-in. Make sure your plan
includes:
• Dedicated project team that includes IT
• Approved budget
• Timelines for evaluation, selection and implementation
Failure to take these steps can result in a longer evaluation process or, worse, selecting a solution that
doesn’t do what you need. If you are uncertain about what you need, engage a consultant as it could
save you time and money in the long run.
Don’t get distracted – stay focused on solving core needs
OK, you have your requirements in hand. You have a clearly defined project plan and budget. Here
comes the fun part – shopping! If you only remember one thing from this article, let it be this – you can’t
build a penthouse without a solid foundation. If the HR solution you choose can’t perform the basic,
core functions (payroll, benefits enrollment, life event changes, etc.) accurately and on time, the fact
that you can immediately recognize a colleague via a social collaboration tool isn’t going to matter,
especially if he/she doesn’t get paid properly.
It is an exciting time for HR technology as new features, functionalities and capabilities are rapidly
introduced into the marketplace, some of which your organization may need now and many of which
your organization may want, but never use. The point is to be able to easily differentiate between the
value-added and the nice-to-have features. The best way to do this is to stay focused on solving your
core issues first and foremost. Don’t worry, if you choose carefully, there will be an opportunity to add
those shiny bells and whistles down the road.
That said, there are some basic key tenets you should look for in an HR solution. These include, but are
not limited to:
• Functionality should meet your requirements – The integration of HR services should match your
immediate needs and be able to accommodate and grow as your needs change.
• Speed and ease of deployment – If you choose a cloud-based solution, it should be quick and painless
to implement.

5. • Ease of use and adoption – An intuitive, easy-to-use user interface is critical to maximize adoption
which will maximize the value of your solution.
• Consistent user experience across all devices – One of the key benefits of HR technology is employee
and manager self-service and making that functionality available and uniform across several platforms
will drive user adoption and use.
• Future-proof technology – Your solution should be highly configurable and adaptable to ensure you
are always using the latest technology.
• Single point of entry – For simpler, easier, real-time access to your data, choose a solution that offers
a single database.
As HCM solutions become “systems of engagement” versus “systems of record,” selecting a user-
friendly system that your organization will quickly adapt and use will help you generate the highest
return from your investment.
Making sure you have the support you need when something goes wrong
No piece of technology is perfect and neither is any vendor. There will be issues no matter which
solution provider you choose as your partner. That is why it is extremely important to fully understand
what the vendors you consider offer with regard to service and support. What is the support structure?
Do they provide a Service Level Agreement (SLA) or similar provision? Do current clients find them easy
to do business with?
In addition to a vendor’s service reputation, you want to align yourself with a company that is financially
stable, has an experienced team of professionals to implement and support your solution, and invests
time and money into continuously improving its products and services.
It is also worth investing time and effort to learn about the company’s history as well as their short and
long-term business plans. In a market where new players emerge fairly regularly and acquisitions
happen frequently, it is important to know the provider you choose is going to be around to support you
for the duration of the relationship.