How to Persuade Company Leaders to Invest in New HR Technology

By Dave Zielinski November 27, 2018
LIKE SAVE

​It's an exciting time to be a buyer in the human resources technology market. HR leaders can choose from a growing array of artificial intelligence tools; next-generation, "best of breed" recruiting or performance management systems; and intuitive, feature-rich human resource management and applicant tracking systems.

But drooling over this parade of new technologies is one thing. Convincing those who control the purse strings to agree to purchase them is another.

Those who succeed in getting CFOs, CIOs or other executives to green-light significant technology purchases understand that stressing the "hard" benefits of these tools—such as productivity gains, faster hiring or reduction of compliance risk—beats touting "softer" benefits, such as a better employee experience or fewer administrative burdens.

HR executives who have negotiated technology purchases also know that descriptions of shiny new features will likely fall on deaf ears if those tools aren't somehow tied to cost savings or revenue improvements.

[SHRM members-only online discussion platform: SHRM Connect]

Pitching from the C-Suite's Point of View

Take time to understand the pain points and perspectives of executive decision-makers and business line managers, said George LaRocque, founder and principal analyst of HRWins, an HR technology consulting firm in New Providence, N.J. "For example, you might find in sitting down with your leadership team that two of its top priorities are reducing employee absenteeism and controlling overtime. So if you're pitching a new or upgraded cloud-based [HR information] system, you could emphasize the benefits of that platform's time and attendance module."

A new payroll system that promises to reduce errors, artificial intelligence tools that speed up time-to-hire, or technologies that reduce the amount of time business unit leaders spend on HR administrative tasks are likely to resonate with a CFO, LaRocque said. 

He told of one staffing company that got approval for a new onboarding technology in part by tying it to revenue gains. "They made the case that if more efficient onboarding allows a new shuttle driver to show up on Monday instead of on Wednesday to begin driving shuttles, that's two days of additional billing for the company," he said.

Mollie Lombardi, co-founder and CEO of Aptitude Research Partners, a research-based HR technology advisory firm in Boston, encourages HR leaders to lean heavily on dollar figures in their pitches. "We have a tendency to shy away from numbers in HR, but the ability to translate the value of technology into cost savings or productivity improvements can be powerful," she said. "CFOs and other executives are always asking, 'A new technology in service of what?' They want to reduce overhead costs, improve things like payroll accuracy or help recruit hard-to-find talent more effectively."

Frame a soft benefit such as "improved user experience" as "improved user adoption" instead, Lombardi suggested. "It doesn't matter how expensive or inexpensive a new system is; if people don't use it at a high rate, it becomes a bad investment."

For example, consider how you might pitch the purchase of a recruitment marketing platform. These systems help build relationships with candidates before they apply for jobs and can reduce the costs and risks associated with using disparate recruiting solutions.

Based on research from Aptitude Research Partners, a company marketing 1,000 jobs annually could save:

  • $150,000 by eliminating duplicative recruiting tools, such as careers sites, candidate relationship management systems, referrals and events.
  • $300,000 by eliminating ineffective job boards and services including paid advertising, search engine optimization and more.

Based on these estimates, the purchase of a new recruitment marketing platform costing $125,000 could result in a total savings of $325,000.

Accurate Cost Estimates and Pilots

Give decision-makers a full picture of technology costs, experts said. "For example, saying that a cloud-based product will cost 'X' dollars per user per month is only one part of your expenses," explained Michael Rochelle, chief strategy officer with the Brandon Hall Group in Delray Beach, Fla. Be sure to factor in costs for data migration, product implementation, technical support services, integration with other systems and training to help users learn the new system. "Most companies don't build out their budgets big enough to accommodate that total cost of ownership."

One way to help win approval is to pilot small-scale use of a technology, said Chris Havrilla, vice president of HR technology and solution provider strategy at Bersin by Deloitte Consulting in Atlanta. Experts say it can pay to ask vendors if they'll offer pilot programs for their products. Havrilla said one company she worked with "did a pilot to test the solution and got a quick win, which helped them secure funding for a fuller rollout in other parts of the company."

Dave Zielinski is a freelance writer and editor in Minneapolis.

LIKE SAVE

Job Finder

Find an HR Job Near You
Search Jobs

SPONSOR OFFERS

Find the Right Vendor for Your HR Needs

SHRM’s HR Vendor Directory contains over 10,000 companies

Search & Connect

HR Daily Newsletter

News, trends and analysis, as well as breaking news alerts, to help HR professionals do their jobs better each business day.
temp_image