Things to consider when selecting the best HR and Payroll software for your organization

There are a few HR and Payroll software solutions available in Nepal. We often find organizations struggling to choose the best software for their organization.

Human resources software selection is one of the major business decisions to be made by organizations who believe in human capital and want to leverage human capital to deliver the optimal contribution to organizational goal achievement. The system should support people operation and provide an optimum solution that satisfies all the stakeholders needs in an organization in addition to Human Resources and Finance Managers viz. owners, executives, middle managers, employees.

Here we outline some areas based on which the selection team can make a good decision.

Questions to ask yourself

1. What we want to achieve now and down the line in three years from now and what features and functionalities we need?
2. What is our budget and how much we can invest in leveraging the people function through technological platform?
3. What we are looking for – a record keeping function or a futuristic people platform.
4. What is the level of our manpower who handles people operation? Are they capable? Do we need to upgrade them?
5. What will be our people operation modality – stick and carrot or collaboration, engagement, learning, performance, and development?
6. What is the mix of our workforce (e.g Gen Z, Millennials, Gen X) and what they expect from us?
7. What kind of system is needed for our approach?
8. Is there scope for our system improvement when going digital?
9. Should we build the system ourselves or seek a technology partner who specializes in Human Resources?
10. If we need to build the system, should we build the entire solution ourselves or partner with a software solution provider and build only part of the system that is specific to our business (in the form of add-ins or plug-ins)?

Sometimes, you may not have the clearest idea regarding what is possible with human resources platform to achieve. You may be just satisfied with what you have and not explore what is available out there. In that case, we recommend asking for demos from a few selected vendors and decide what you want and what is possible.

What to do if you decide to build the solution yourself

Sometimes, based on the nature of your organization, none of the available human resources software may fit your needs. In that case you may choose to build the system yourself. The decision may be to build the entire system yourself or build a part of the system module specific to your organization.

When you decide to build the entire system by yourself, you should have adequate budget, time and manpower to build the system and maintain the system in the coming years. Various studies tell more than 85% of such projects fail due to various reasons. To avoid the failure faced by more than 85% of projects, we recommend investing in good people and technology and plan and execute the plan properly to make your project a success.

What to do if you decide to choose a software solution provider

Selecting a vendor that has the solution you desire and finding out the solution actually works as presented is another challenging task. Most of the software solutions providers in Nepal provide low quality sub-standard products that do not work and are just waste your time, money and effort creating further frustration. To avoid such loss and frustration, we recommend a structured decision process.

Things to check with the Vendors

1. Do they understand the complex nature of Human Resources Operations?
2. Who designs their system and what is their research, innovation, and development process?
3. Do they understand human resources and follow international HR best practices?
4. Do they understand legal and taxation issues of Nepal and will there be a reliable person in the core team to provide legal and taxable updates in the future?
5. What is their pricing, and will they be able to do business in a sustainable manner and provide innovative solutions at that price point? You should be extra cautious in this point, low initial fee usually points toward hidden fees in the future or low quality system.
6. How long they are in the business and what are the chances they will continue providing innovative and cutting-edge solutions in the future?
7. What do they promise? If a vendor promises a lots of things, you should be cautious – why they are doing so and will they be able to honor and keep their promise.
8. Do the features work as advertised/presented?
9. Does the vendor work on many kinds of software or specialize on human resources and payroll related software? If a vendor works on many kinds of software, most likely the vendor does not specialize in anything, nothing may be good enough for your business – because you need the best to support your vision and be competitive.
10. What is the technological platform?
11. Is it modern, secure, fast and scalable?
12. Does the vendor provides APIs to connect with our other systems now and in the future?
13. Can we develop our own module and integrate with the system, if needed, now or in the future?
14. How accurate and fast is the payroll and tax calculation?
15. How easy is the system to be used – by HR and Finance departments, executives and most importantly managers and employees?
16. Do they have easy to use mobile application?
17. Does the system provides self-service solution to the employees seamlessly with adequate guides, error prevention, and guidance.
18. Does the system support flexible Roles, Permission, Access, and Authority?
19. Does the system have maker and checker function with audit log? Can we verify the origin and trace the issue of something goes wrong?
20. Does the service provider have state-of-art, secure and reliable cloud platform?
21. How vendor’s internal operations are run and how safe is your confidential information?
22. What is the backup and safety mechanism?
23. What is the quality of help and support and how knowledgeable people are available for support?
24. What is customer feedback? Instead of just taking the words, we recommend you visit the recommending organization and check the system and functions they are using. Talk to them about the issues they are facing. And decide those issues are relevant to your organization, as well, or those issues do not matter.

Software Customization

Finally, let’s talk about customized software.

Customizations are only required if the intended system does not have the required features or does not function as desired. If the system does have the required features and does work as intended, customizations may not be required.

Most importantly, the system you choose should be configurable to address many possible scenarios. The best planned and best designed software provides configurable options to define your rules while being on top of the standard, acceptable and legal practices.

Most of the vendors offer customization on demand. But in our 13 years of experience and global case studies we find that:

1. Customizations, if done the right way, costs a lots of money in initial customization and lifelong maintenance of the customized system.
2. Software suppliers who offer customization at low fees mostly die due to the heavy burden they create over time by customizing systems to have many version of the software and not able to maintain them and make a profit out of the hectic business.
3. Customized software has many errors and omissions because the vendor misses something in some version and one customers customization mix with another. This creates a constant mess in the vendor operation and too much discomfort on the customer side.
4. Customized software vendors cannot update the software in time because they have to work in multiple versions at a time.
5. Customized software vendors are mostly very late or not able to provide future innovations since they are mostly busy dealing with customized customers issues and errors.

Best wishes! Take a wise decision; for now, and for the future; for you, and your team.