HR.COMmentary on Online Benefits Providers
There´s one thing important to remember about ASP vendors, although they are selling you a product in an industry with at least a handful of other competitors, in today´s environment, your long-run satisfaction is much more important than their short-term gains. The Internet is still a new entity within the business realm and integrating systems, corporate identity, providers and intranet is no easy task. Here are some tips to help you wade through the material.
What are some of the things you should consider when choosing the appropriate vendor?
There are a handful of questions and actions that you should ask yourself and do before deciding on a shortened vendor list:
1) What are your HR needs and in what areas will the HRIS be used?
a. With online applications, your future needs can´t be so easily defined and forecasted into the application as customization capabilities are still being expanded. However, if you have an idea of where your needs will be, make sure the vendor has the intent and capability for growth. Talk to management to see where they see their future needs and growth areas.
2) A web-based application will require fewer team members to be involved with the implementation; however, don´t forget that your team members will change with a web-based system.
a. A traditionally based HRIS can require the intensive efforts of many more team members for active involvement and consultation. Web-based apps lessen the burden on your IT staff but still require the support and involvement of some key members. Make sure you´ve got a project leader, HR staff members, at least one or two IT guys, some payroll involvement, vendor contact, management representative, and the understanding and involvement of your employees. Initiatives can often fail without employee consultation. Since the web-based app will be used directly by them, you want to make sure they are aware of the drastic change and won´t be afraid of the technology.
3) What´s your budget?
a. The management representative should be able to tell you how much the company can allot to the project. In addition, get a general idea of how much a web-based application will cost over the years. As a rule of thumb for mid-sized companies, there is a one-time implementation fee that can range from several thousand to tens of thousands of dollars depending on the size and integration of the application. There are also per user per month fees that can range from less than $10 to over $20 depending on the number of users.
4) Connect your HR goals with your HR needs and write them out in detail.
a. Expect this step to take the longest as it is extremely important and worth spending extra time. What you´re going to do at this stage is examine your existing systems to see what gaps the application will fill. What are your connections to payroll and your other in-house apps? What exactly do you want to include in your web-based system and what specifically do you not want to include?
b. The best thing about web-based apps is that there is some flexibility and a lot of scalability power. Therefore, if you´ve made the wrong decision initially, it´s much easier to add or change the functionality and additional modules in your application. Keep in mind what your workforce looks like now and what it will look like 5 years from now.
5) Check out a comprehensive vendor listing
a. I´ve tried to include a pretty lengthy listing of online benefits providers. However, if you´re from a larger organization, you may want to check out benefits and HRIS web-based applications that provide both benefits and full HR functionality into their systems. Some of the major competitors there include:
6) Who are their clients?
a. Get a listing of clients who have similar needs, infrastructure, and business processes to your own. Give them a call to see how satisfied they are with the service, connectivity, support, functionality, features, etc.
Make sure you see if there is a good fit between yourself and the vendor and ask about:
- Their IT investment
- Management Proposals, Strategy and future development
- Reputation and longevity
- Partners and Service Providers
- Professional Service Expertise in both implementation and continuing support
- Solution Speed to market
Check out HR.com´s CEO, Debbie McGrath´s complementary article on "Questions to Ask Your HR Vendor" for some further insight into what you should know.
What are some of the limitations to using a web-based application?
There are a handful of recurring complaints that I hear within the industry, the following are some of the major obstacles that we still have to overcome.
1) Lack of Integration
a. As I´ve mentioned throughout this (way too) lengthy article, although companies state that they can get their IT systems talking with your IT systems, don´t underestimate the length of time it will take before they have a decent conversation.
2) Employee Use Conversion
a. People don´t like change and people don´t like technology. Don´t expect them to adapt to your new ASP likes ducks to water. Your HR department will still be receiving not only benefits calls, but also "how-to-work-the-darn-application" calls.
3) Flexibility/Customization
a. Client-server systems are a hard act to follow. Although they were outrageously expensive, they sure were powerful, flexible, and mostly underused. Our expectations should be much lower for online applications. Not only is the technology fast, it´s new. Don´t expect web-base app´s to do the same job as client-server systems.
4) Data inputting and conversion
a. This process can take a lot longer than you would expect. In fact, it´s often the most onerous and time-consuming aspect to a web-based implementation. You know when vendors say that implementation takes about 8-10 weeks? They really mean 8 weeks of data conversion and imputing and 2 weeks of deployment. (That´s actually an exaggeration but you know what I mean.) It takes awhile to get the information in, get the system running, and get accurate information out of the system. Some clients have noted the saying "Garbage In, Garbage Out" as being an accurate statement in the first few weeks of implementation.
5) IT infrastructure
a. If your company relies solely on your web-based application and employs no readily accessible backup, any IT downtime, disconnections, and server problems can produce severe disruptions to your systems. The most robust combination would integrate with your in-house ERP systems such that your entire platform is not relying on a possibly unstable Internet connection.
Once you´ve understood and experienced all of these set backs, your new ASP implementation should be smooth sailing (wink wink; nudge nudge). Listen to what your vendors are saying but remember to always view information through a future-forward, risk management filter. Make sure you remember the features and functionality that you want AND don´t want. And anticipate longer timeframes and limited capabilities especially with such new technology. That way, you´ll never be disappointed when a vendor suddenly surprises you if they inform you that they´re only slightly off schedule.
Good luck with choosing your online application!!