The HR tech marketplace is as varied as the HR profession itself. If there’s a duty that falls under the HR umbrella, there’s technology for it. Tools of the trade include everything from talent acquisition software and employee engagement modules to HRIS systems and leave management platforms.
The complexity of the HR tech market can lead to some serious confusion for buyers. When organizations begin to search for a solution, they’re confronted with a huge range of products, platforms, and prices.
This phenomenon holds true even in the niche world of leave management technology. For example, there are point solutions for specific categories of leave management, like FMLA leave or job accommodations. There are platforms that provide workflow automations and add-ons for your existing solutions. There are combined platforms offering configurability and compliance engines. And don’t forget: There are many different options for co-sourcing and third-party vendors, too.
The magnitude of this market isn’t the only thing overwhelming organizations on the hunt for a leave management solution. The stakes of choosing the right solution are high, as the success of your leave management solution determines the success of your leave management program. The wrong investment or partnership can frustrate employees and HR alike. It can also harm your compliance efforts and even lead to costly litigation. On the flip side, however, technology can deliver a host of benefits. It can elevate the employee experience, alleviate HR strain, boost compliance, and reduce risk.
Sixty percent of organizations plan to invest more resources in leave management this year, according to AbsenceSoft research. If you’re among them, you need a plan. Begin by thinking about your goals and the ROI you want your future partner to deliver. By mapping out your objectives, you can better evaluate the solution options, feature lists, and demos vendors will send your way.
In this article, we lay out five steps that will help you find the partner you need in a complex marketplace. You’ll learn how to calculate ROI and total cost of ownership. Plus, you’ll discover how to champion your choice in a business case that speaks to all your stakeholders.
Step 1: Think Beyond Your Team’s Challenges
It’s likely that you’re overly familiar with the challenges your team faces in managing leave and accommodations. But to find the right solution for your organization, you need to consider the problems you currently face and the goals you’d like to achieve. Without this context, the platform you pick may solve your current challenges but be unable to scale to meet your needs or evolving workforce later on.
Begin by documenting the challenges and goals you want your future partner to address. Consider asking employees about the improvements they’d like to see in leave and accommodations. According to a recent AbsenceSoft report, 45% of employees named self-service portals and text messaging as the change that would most improve the leave experience.
Interview your HR team members to understand what they hope to achieve. Nearly two-thirds of HR leaders want to support employee well-being and work-life balance through their leave policies and programs, according to AbsenceSoft research. More than 50% are leveraging their programs to reduce turnover and improve the employee experience. It’s important to find a solution that supports your team’s specific goals.
Finally, spend time with company leadership to assess the future challenges you could address through technology. It’s important to choose a solution that scales with your business as your workforce evolves.
When you start your search by defining your business goals and future state, it’s far easier to maneuver the marketplace. You’ll identify solutions that solve your current frustrations and chart a path for future goals.
Step 2: Build a Team with Varied Viewpoints
Selecting leave management technology should involve a wide range of people. Of course, HR uses the leave software they’ve invested in on a daily basis. But a platform’s user base also includes managers, employees, and even executives.
Your search committee must represent all of these groups. To properly weigh different aspects of each solution, you need varied viewpoints. You’ll also need people who understand your organization’s approach to technology and its budget, so be sure to include leaders from finance and IT.
Step 3: Evaluate Tools for ROI and TCO
When you begin investigating vendors, you may feel like you’re comparing apples to oranges. Each product offers its own set of pros and cons. To bring some consistency to your search, focus on return on investment (ROI) and total cost of ownership (TCO). Weighing these two metrics will bring clarity to your search. They’ll make sure you consider how a tool works and how it will impact your organization and its goals.
Why ROI for HR Tech is So Wide-Ranging
It can be challenging to calculate ROI for HR technology. The impact of HR tech is broad, so it’s important to factor many different aspects of ROI into your calculation. For instance, the calculation for the ROI of a leave management solution should include:
- Reduction in legal risk
- Efficiency gains for administrators
- Enhanced employee experience and satisfaction
- Gains in team productivity
- Reduced hours for replacement workers
- Lower turnover and higher retention
When you dedicate a little time and effort to estimating a solution’s ROI, it’s easier to advocate for it. A detailed forecast of your potential return allows you to clearly communicate a platform’s worth to stakeholders.
To determine the ROI you’d drive with AbsenceSoft, use our ROI calculator.
Remember, TCO is More Than Subscription Fees
In addition to ROI, you’ll also want to estimate a tool’s total cost of ownership. Technology investments come with startup costs, from licensing fees and subscription prices to data migration charges and configuration costs. Each of these items contribute to the total cost of ownership.
HR teams considering a tool’s TCO sometimes miss another important factor: opportunity cost. When HR puts off upgrading their processes with technology, they rob themselves of the tools they need to keep up. That’s a risky move, especially as caseloads continue to their consistent climb, as AbsenceSoft research has found. This isn’t just frustrating for HR. It’s also frustrating for employees, who have to put up with unnecessary delays, frazzled case managers, and even mistakes and misjudgments.
When organizations invest in the technology that reduces administrative labor, HR can spend more time with employees, providing face-to-face support.
Step 4: Dig Into Demos
When you begin your search with ROI and TCO in mind, you’ll be able to quickly eliminate the vendors that won’t work for you. You’ll also be able to identify a short list of strong candidates. Focus your time and energy on these, making sure to vet each potential partner thoroughly.
The demo phase is an excellent opportunity to determine whether a platform offers everything your team needs. During this meeting, you can get to know the software’s features and learn a bit about how the technology works. You’ll want to pay close attention and ask lots of questions. We recommend asking:
- How does your organization handle implementation? How long does it take?
- What integrations do you offer? Will this tool work with our existing tech stack?
- How do you support compliance with leave legislation? How do you account for changes in federal and state laws?
- What does support look like after implementation?
- How often do you release product updates?
- Do you have a dedicated community for networking and learning?
Vendors should take care to answer your questions honestly and thoroughly. Their answers will reveal how well their tool aligns with your team’s expectations, goals, and current infrastructure. When you find a vendor that offers the right services in your budget, you may have found your partner.
Step 5: Build a Business Case
At this point in your search, you’ll have gathered a huge amount of information. You’ll understand the ROI you want to create, the TCO of your proposed solution, and the ins and outs of the product you’ve picked.
Now it’s time to take that information and condense it into an argument that will convince executives to invest in the solution you’ve spent so much time choosing. This argument is your business case.
A strong business case communicates a problem and a solution. The best ones use data to show why the solution is necessary and how it will ease or eliminate current pain points. Here are four key pieces of information your business case should communicate:
- Your organization’s current state: State how much your employer currently spends on leave management.
- The ROI HR tech may drive: Illustrate what your organization could gain by investing in leave management technology.
- The risks technology will eliminate: Part of the ROI of leave technology is the reduced risk of compliance errors. Include information about the average costs of employment lawsuits, payouts to the EEOC, and other data points.
- Stakeholder-specific messaging: Show the value the software will generate for finance, HR, legal, IT, and key members of the C-suite.
To learn more about how to evaluate platforms and leave models, as well as how to build a business case, download our free guide: The HR Leader’s Guide to Evaluating Leave Solutions.
Looking for a Leave Partner? Add AbsenceSoft to Your List
When a recent AbsenceSoft report revealed that nearly two-thirds of HR leaders are considering investing more in leave management, it came as no surprise. Employers need technology to keep up with ever-increasing leave requests, changing state laws, and rising employee expectations.
AbsenceSoft offers a platform that addresses all of these challenges. Our leave management software combines automation technology with human expertise to offer a tool that boosts compliance and reduces administrative labor, all while improving the employee experience. Our platform includes:
- The AbsenceSoft Compliance Engine, which supports more than 200 federal and state leave and accommodations laws, including the FMLA, ADA, and PWFA.
- A Case Management Module that ensures cases are up to date, tracked, and organized.
- Employee self-service portals where employees can request a leave or accommodation from any device, at any time.
- Integrations with popular providers like Workday, UKG, ADP, SAP, and others.
If your team would like to learn more about how AbsenceSoft can support your approach to leave management, book a demo with one of our CLMS-certified leave specialists today.