There has been an uptick in HR tech spending over the last couple of years. By the end of 2021, total venture in HR tech spending exceeded $7.5 billion, which was more than the combined spending for 2019 and 2020. The flooding of new HR tech vendors into the market can present challenges to companies looking to invest in or upgrade their HR technology, as it can make the research, selection and buying process more difficult.
What technologies are truly must-haves? Which is the most cost-effective solution for our needs? These are just some of the questions those with purchasing power face.
When you’re up against a tight labor market and pressure from hiring managers and executives with a rapidly shrinking budget, you may be quick to pull the trigger on the first HR tech vendor you come across. But the fact of the matter is you need to move slowly and methodically, and choose a solution that closely aligns with the pain points you’re experiencing.
In this article, we’ll explain how to choose the right HR tech vendor for your organization’s unique needs when it comes to talent acquisition.
To find the right solution, you first need to intimately understand the problem you’re experiencing, what is causing it and the value of solving it. Take the time necessary to analyze your needs and gather input. Your IT department’s perspective, for example, on privacy and security should be considered, as well as other stakeholders’ needs within the organization that support and are part of the talent acquisition process.
Fortunately, the majority of invested leaders go 60 percent of the way through the entire HR vendor-buying process prior to reaching out to a vendor. This implies they are doing their due diligence prior to getting “sold” by a vendor. If you reach out to vendors too soon based on your internally-identified pain points, you might lose sight of what’s most essential and get caught up in what’s new and exciting that a vendor is trying to sell to you — after all, that’s their job. In some instances, companies have secured software too soon and end up having to start the process all over again because the purchase didn’t meet the foundational needs of the organization. A lot of time and resources were wasted in the process.
You know your problem. Now, what do you need to successfully solve it?
Make a list of non-negotiables – these are the things you must have in order to effectively address the pain you’re experiencing. Rank and prioritize these requirements, so you know which takes precedence when it comes down to making choices. As you explore options, you should refer to this list and evaluate your priorities against vendor capabilities.
Once you’ve identified the value of finding a solution, write it down. That’s your business case. It’s also your anchor when you get distracted by flashy vendors and “shiny object” solutions. Refer back to your business case as a reminder of what the end goal is.
Validate your investments with data when you can. Keep in mind though, there’s a lot more to people and recruitment than just numbers; hires are great, but you can’t get them without successfully selling them on your brand. Think qualitatively and be cognizant of the intangible value your organization can benefit from a recruitment investment, such as brand awareness and affinity.
As you watch demos of solutions, don’t get sold on some of the new opportunities and approaches that might be available with the software presented by those vendors wanting your business. Consider the demos as research and information only to guide your decision-making process to select the best solution for your organization.
What’s vital to bear in mind is that a technology investment should simplify your life, not make it harder. As you get towards the end of your buying process, zoom out and think about the bigger picture. Will this software work cohesively within your existing team structure? If not, you may need to rethink your requirements.
Though it feels like you might need to be in a hurry to make a decision and select an HR vendor due to the pressures you’re facing, the last thing you want is to move too quickly and make the wrong decision. In the end, taking your time and working methodically will pay off as you select the best HR tech solution that aligns with your business case and makes your work life easier.