HRchitect has been involved in approximately 2000 HR technology related projects for hundreds of companies of all sizes and industries across the world. We have gained tremendous insight (and continue to every single day) and feel an obligation to share our expertise, and our war stories, with you. After all, with 15 years in business behind us in working with many of today’s leading companies, we’ve gained a unique perspective on the very puzzling world of HR technology.
We’ve covered the benefits and rationale of Decision Drivers along with definitions of key Decision Drivers. Now, let’s talk about ranking them for your HR technology evaluation and selection project.
It is critical for the client project team to gain consensus on the relative priority of these drivers as early as possible in the selection process; doing so provides an “anchor” that will help keep project team members from being inordinately influenced by a particular package’s “bells and whistles.” Therefore, a Decision
Driver ranking exercise is one of the early stage deliverables in HRchitect’s selection methodology.
The ranking process generally takes place during a short series (generally 1-3) of on-site meetings or conference calls. Once the team understands what is included in each decision driver, the concept is to divide the twelve decision drivers into four main “levels” for consideration:
- Exclude—these criteria are not at all relevant to the business (e.g., Global Capability may not apply to a US-only retail organization, Scalability may not materially affect a midmarket company)
- Level 1 (Knock-out)—these criteria are so critical that they drive whether or not a vendor is even sent an RFI or RFP (e.g., Technology requirement is for a SaaS vendor, vendor must have HCM revenues in excess of $100M)
- Level 2 (RFI/RFP/Demo)—these criteria are best assessed by evaluating vendor written responses and by viewing product demonstrations. All criteria in this level are weighted, usually on a 100 point scale.
- Level 3 (Due Diligence/Purchase)—due to the need for the team in this phase to uncover more detailed information via reference calls, detailed financial discussions, and other due diligence tasks, there may be some initial Knockout criteria repeated here. This level is also weighed on a 100 point scale.
Below is a generic example of how a project team might rank the decision driver criteria:
Because ABC Company is based in the US, the project team excluded Global Capability from further consideration. Next, they determined the Knockout criteria (high level, but specific enough to drive the vendors to be selected). Level 2 criteria focused mostly on the capabilities of the software itself, with allocation of 100 weighting points. Finally, Level 3 criteria were defined—note the return of Vendor Viability and Cost, as more specific information is now available as a result of due diligence activities; note also that a number of other decision drivers appear here, as a more accurate assessment can be made based on the results of customer references.
This approach is typical of the majority of decision driver ranking exercises that
HRchitect does with clients, although the base process is often modified to include more or less detail per the desires of the client project team. Many HRchitect clients report a substantial benefit to having a 3rd party consultant involved with the ranking exercise due to the following:
- A neutral 3rd party guide with no vested interest can help to surface and resolve political or “turf” issues that otherwise might derail consensus—resulting in a quicker ranking process with improved team dynamics
- An outside perspective aware of current trends and capabilities of vendors in the market can provide expert fact-based commentary that supports the ranking process
- Involvement by a competent 3rd party consultant who is able to testify to the impartiality of the process will often add legitimacy in the eyes of senior leadership.
We hope you enjoyed this series of blogs on “Decision Drivers” which described a leading practice methodology for incorporating decision drivers into an HCM technology evaluation project. While organizations may vary somewhat in the actual steps performed (as well as the sequence), the most important thing is that there is some form of decision driver ranking process conducted as a part of any HCM technology selection, and that it be completed early in the project in order to keep the team focused on the most important selection criteria based on the needs of the organization. Doing so will prevent a loss of focus by the project team, a potentially stalled decision making process, an undue focus on functionality and cost, and an inappropriate level of subjectivity. Using decision drivers to get the full picture of organization requirements will lead to a “best fit” package selection that has the greatest chance of meeting the firm’s needs over the long term.
It’s an extremely puzzling world out there. Many vendor offerings look alike, the vendor community is in a constant state of flux, and there is not a “one solution fits all”. HRchitect’s Decision Drivers process will help ensure you get the best-fit system for your needs, the first time.
As always, please let us know how HRchitect can assist you to get maximum benefit that comes from automating your Human Capital Management functions. We exist to serve you!