Six ‘Beware’ Factors to Consider in Today’s Cloud HCM Offerings

Its been a long time since HCM solutions were primarily used for ‘counting noses’.   Companies large and small understand the strategic value in their workforce and are aggressively using HCM solutions to support their investment, and HCM providers know it.  Between emerging technology, disruptive companies, mergers and acquisitions, changing licensing models, cloud migrations, and much more, to say today’s HCM software market is under rapid change would be a massive understatement.  Unfortunately, none of us really have the luxury of ignoring these changes lest we be left in the wake of overpaying for a non-compliant, underperforming, and disjointed solution that no one is happy with.  Of course, you may never make everyone 100% happy, but deploying a cost optimized, flexible, and competent solution will certainly keep most of the Human Resources and Finance folks happy(ish).

We see quite a bit of this HCM market activity across a broad group of suppliers in the space.  Here we’ve outlined six of the critical factors that come up repeatedly as areas to keep a keen eye on as you walk down the HCM decision(s) path.

  • Beware the Roadmaps. Technology suppliers across all industries LOVE to tout their product roadmaps!  With HCM solutions, this is a critical piece of messaging as I find it’s almost always used as a screen to cover up shortcomings in the solution directly related to a customer requirement.  On the less egregious side, we may see an example where a supplier suggests that “updates to form fields or workflows will be tweaked in a coming quarter or two”.  Conversely, we’ve also seen suppliers flat out selling vaporware that comes with zero guarantees of delivery at all, let alone a timeframe for release with suppliers claiming, ‘their accountants’ won’t allow them to make commitments in the future but “trust us….we’ll get you what you need”.  We recommend always building your solution on what IS CURRENTLY AVAILABLE, and not get caught ‘backward driving’ later, to try and figure out another work around for a requirement the solution can’t meet.  There are ways to protect yourself contractually in the event of a supplier over-promising, and you should be sure to take advantage of all of them.
  • Beware the Integrated Solution. If this were a family, ‘Beware the Integrated Solution’ would be very closely related to ‘Beware the Roadmaps’ as they are often intertwined.  We have seen many promises of integration availability with little in the way of guarantees or remedies when and if such promises are forgotten or not nearly as ‘seamless’ as claimed during the sales cycle.  Often ‘bolt on’ applications are passed off as an integration and come with their own bag of issues and overhead.  Take Workday for example.  Workday’s highly touted ‘ecosystem’ isn’t much more than bolt-on solutions recommended by Workday to allow them to fill functional gaps that its own solution does not support.   If not carefully managed, utilizing these bolt-ons, whether with Workday or another solution, opens you up to the potential for conflicting contract terms, inconsistent SLA’s and supplier management challenges to say the least.
  • Beware the Licensing Changes. Flexibility is not a term you will hear suppliers willingly utter when discussing licensing.  No matter your requirements, the amount of flexibility the supplier offers up front is typically less than reality.  If you think about the perspective of the sales team, are you going to lead with the ‘all or nothing’ approach to maximize margins and commission checks, or would you lead with a ‘less is more’ offer that, while more client-centric, reduces their earnings potential?  You can’t really blame them for this approach….because IT WORKS.  There is a cadence to saying yes and no with suppliers, and many customers just don’t know how to optimize this process for both parties.  When changes to licensing are presented in an ‘all or nothing’ format, and you’re not sure what to do next, call us.
  • Beware of the ‘Shop’. While I’ve already said you should beware the ‘Integrated Solution,’ there are integrations that make absolute sense!  One of the worst things I hear is an HCM customer refer to themselves as a current or future ‘shop’, as in “We’re a Taleo shop” or we intend to be a “Workday shop”.  Many HCM customers feel that they will have an advantage if they become a ‘shop’ in the way of discounts and or new releases from the supplier.  It’s human nature to think that “Hey, if we give them more business, they will treat us better.”  Like better service, support and discounts.  Unfortunately, it’s the opposite.  The minute you become a ‘shop’, you have ceded control and will cease to receive the most favored pricing.  A great example of this you can find with Oracle.  Many Oracle ERP customers think that if they go with their HCM offerings, they will reap a laundry list of advantages.  They won’t, and if you are getting told you will, call us and we’ll tell you why it’s not true.
  • Beware the former Disruptors. Most of the major software suppliers in every industry were a disruptor at some point.  The successful ones make the transition from disruptor to mainstay as they gain market share and influence.  Its important to take note of them as the HCM solution(s) you have today may have been an upstart, eager to please, overachieving disruptor when you bought in, but they may have transitioned over to the ‘dark side’ of tyranny without you even realizing it.  We call this transition ‘Mysticism to Tyranny’.  This is typically defined by supplier behavior and solutions that start by delivering cost effective, innovative solutions in a competitive environment (The Mystics), who then over time move to a dominant market position and use their new-found leverage over a large customer base and increased demand, to drive prices up and innovators out. Not long after this, many of these onetime disruptors take on the attitude “if you don’t like it, too bad” (Tyrants).  An example of this we’ve seen of late is Ultimate Software, where once they were very competitively priced, are now among the most expensive in the market.
  • Beware the Global Solution. Maintaining regulatory compliance is part of the cost of doing business in any country that you operate.  HCM suppliers LOVE to tout that they have global solutions, are global at their core, do the work of maintaining compliance for you, etc.  But not a one of them will take on unlimited liability in the event something is processed wrong or a law is violated because their ‘global solution’ didn’t operate as advertised.  If a supplier is telling you not to worry, they support companies’ complex global operations like yours all the time, call us so we can discuss how we might help you avoid the ‘global with a bunch of exceptions in fine print’ trap.

In summary, there are a myriad of things to consider when reviewing solutions in the HCM market and these are but a few.  However, ensuring you are on top of these items can and will mitigate many of the others risk factors in the latest wave of HCM market changes.  As with any supplier question or concern, we encourage you to contact us for a no charge – unbiased chat about whatever your current issues are. 

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