8 Tips for Buying a New HR System

Investing in new IT systems is a strategic decision that can transform an entire organization. It is therefore crucial to choose the system carefully, as it should ideally function optimally for many years. In this article, you’ll find eight helpful tips that can guide you in selecting the system that best fits your organization. By setting clear goals, securing leadership support, and focusing on the employee experience, you can avoid common pitfalls and maximize the value of the investment. The key to success lies in continuously following up, adjusting, and improving — an HR system is not a one-off effort, but a long-term tool for strengthening organizational efficiency and future-proofing HR processes.

In this article, you’ll find eight tips to help you identify the system that best suits your organization.

1. Clear objectives and a business case

Start by defining exactly why your organization needs a new HR system. Set concrete goals for what the system must deliver — for example, streamlining the recruitment process, providing employees with self-service access, or improving onboarding programs. If the company frequently hires new employees, a high degree of automation in recruitment and onboarding can save resources and ensure a strong start for new colleagues.

Prepare a description of the business needs but keep it from becoming too detailed and focus on the specific needs your organization has.

Develop a business case outlining expected costs and potential savings. The business case should serve as a framework that clarifies the objectives you want to achieve, who is responsible, and when the desired results should be realized.

2. Focus and commitment from leadership

No change process can succeed without commitment from leadership. Implementing a new HR system requires resources, budget, and time. It is therefore essential that leadership not only supports the project but also actively participates across the organization. Many believe that the HR system is only relevant to the HR department — which is far from true.

By showing commitment and clearly communicating the purpose of the change, leadership can foster a positive attitude and reduce resistance within the organization. It may also be a good idea, even during the procurement phase, to consider roles and responsibilities to ensure that the right people are involved when the system is selected.

Implementing a new HR system requires resources, budget, and time. Leadership must therefore not only support but actively participate in the process across the company.

3. Integration with other systems

To unlock the full potential of the HR system, it must be able to integrate with other systems such as payroll, time registration, single sign-on, and finance systems. Choosing an HR system that already has existing integrations with the systems you use can help avoid the need to build new integrations. This is especially important in relation to the payroll system — if it cannot be integrated properly, it may result in excessive manual work and increased payroll administration costs.

It can be beneficial to choose an HR system with existing integrations to the systems you already use to avoid having to build new ones.

4. HR data and reporting

A new HR system provides access to valuable data that can be used to make informed and strategic decisions. By collecting and analyzing HR data, a company can identify trends and areas for improvement. Therefore, when preparing for discussions with potential vendors, assess how easy or difficult it will be to extract data from the system.

5. User-friendliness and training

Even the most advanced HR system risks becoming unpopular if users don’t understand how, it works or find it difficult to use. User-friendliness is therefore a critical factor when choosing a system. To ensure success, all users — from HR to managers and employees — must receive the necessary training in the system’s functions. By offering continuous support and training, the organization can boost user confidence and engagement.

6. New functionality and scalability

The system must be able to grow with your organization and handle more users and functions as the company evolves. A flexible system that can adapt to both current and future needs is essential — especially the ability to integrate AI into processes to increase automation.

Today, most systems are cloud-based, which means new functionality is released continuously. This makes it even more important to examine how the vendor manages this development and what they expect from you, as employees will need to be prepared for the new features introduced over time. This also impacts the size of the internal support organization required.

7. Support and maintenance

What support does the vendor offer? A strong support team is crucial for smooth operations. Investigate how they handle issues and maintain the platform in general. This also provides valuable insight into what your own support organization will need to manage.

8. Check references

Ask the vendors who remain in the process to provide a few references. Meet with them to hear about their experiences — both with the system and with the implementation partner. It’s important that they are companies like your own.

Additional general advice for purchasing business systems:

• Spend a little time with many vendors and a lot of time with the few who make it to the final round
• Maintain as much dialogue as possible with vendors throughout the process
• Obtain offers from no more than three vendors
• Insist on meeting the team that will carry out the implementation
• Choose the second-best system with the best implementation partner rather than the best system with the wrong partner

By Maria Sundlöf, Partner, HNCO — inspired by Marie Rockström / HerbertNathan & Co.