HR technology adoption is no longer a preferred way to go, it’s practically an inevitability. Nonetheless, many organizations seem to face certain challenges when it comes to the implementation of HR technology.

  • Defining ROI with HR technology can be challenging because HR is a support function. Having said that HR tech implementation results in both cost savings for the HR department as well as quantifiable benefits for other teams. It’s important to take time beforehand to define these.
  • Customization of HR software can often become a hurdle during implementation. It’s important to understand the customization requirements of your organization and choose a provider that can cater to these.
  • Getting buy-in from employees is crucial — successful HR technology adoption depends on it. Training employees and managing motivation and mindset is a key piece of HR tech implementation.
  • It’s important to understand how to manage all the data that will now get generated from the HR technology. Upskilling employees to understand and leverage analytics and make better decisions is the way forward.
  • It’s important to invest in HR technology that takes both cybersecurity and regulatory compliance into account.

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HR Technology, although late to the party, has come a long way in the last few years. Today’s HR technology isn’t just about digitization and process automation. With the help of emerging technologies like AI (Artificial Intelligence), HR technology adoption now has the power to transform many important HR practices — from recruitment to performance management.

Having said that, implementing HR technology has increasingly become a challenge. One of the reasons is that many companies are late to HR tech adoption. At some point, they realize that HR tech is now miles ahead and their current systems are woefully outdated. At this juncture, there is a tendency to leap into HR technology implementation without adequate groundwork. And this is where most of the challenges begin.

In this article, we’ll talk about some of the most common challenges in the implementation of HR technology and how they can be overcome before and during the actual implementation.


Defining ROI (Return on Investment)

This is one of the biggest hurdles to long-term HR technology adoption. Since HR is a support function, getting buy-in for HR technology initiatives becomes harder because ROI becomes difficult to prove. This is not just an issue pre-implementation. Even during and after implementation, keeping track of the effectiveness of HR technology is very hard without ROI metrics in place.

Overcoming the challenge

One of the best ways to overcome this problem is to have pre-defined goals in place. On the one hand, HR technology leads to several cross-department benefits. These include things like improved quality of hires, compliance management, improved employee engagement, better performance management, continuous performance evaluation and so on. It’s important to have a quantitative framework for these benefits before the implementation even begins.

Moreover, there are several cost savings that come directly with the implementation of HR tech. This includes process automation which reduces the need to hire more entry-level employees. These cost savings can immediately be translated into ROI terms so that the benefits of HR technology adoption become obvious. This will even increase the buy-in for other HR tech initiatives going forward.


Enabling customization

One of the biggest challenges in implementing HR technology is that there is no one solution that meets every organization’s needs. There are three reasons for this:

  • Organizations belonging to different industries at different growth stages have very different needs so some level of customization is always required.
  • Organizations themselves evolve over time, and the tools that used to meet their needs earlier are no longer up to the mark.
  • Technology itself evolves and some new solutions to old problems are always around the corner.

Overcoming the challenge

One of the best ways of overcoming this issue is to select the right vendor. If your processes are fairly standard for your industry, then choosing a vendor that has some experience with your industry is the best option.

If your employee policies, performance management policies, HR processes, and recruitment workflows are more customized and specific to the needs of your organization, find a vendor that’s willing to customize those features for you.

If you’re a high-growth company that’s looking to scale quickly, it’s important to find a solution that scales easily with you. Once again, look for an HR solutions provider who’s worked with high-growth companies in the past.

It’s also important to set aside some time for periodic reviews to evaluate the efficacy of the HR technology and ensure that it’s still working for you.

Finally, it’s important not to sweat the small stuff. Instead of looking at every small feature that might be missing from your toolkit, it’s better to make sure that you have everything you need to meet overall business goals.

Adoption by employees

Buy-in from employees is one of the things that can make or break the implementation of any enterprise software, including HR software. There’s a very narrow time window within which employees should start using the software on a regular basis. If this window is missed, successful implementation becomes difficult.

In many cases, ensuring that employees adopt new HR technology requires companies to make a huge investment in training and developing people to use these new tools is the most effective way. There are different generations of employees working within the same company, and they may react differently to new software and new ways of doing things. It also requires a large amount of motivation and a preparedness mindset. Many times senior leadership doesn’t take the time to invest in this motivation and training.

Overcoming the challenge

Any HR technology adoption needs to come with a proper plan around training and motivation. At the first level, this includes communication about the software to the HR teams who will be operating and managing it. At the next level, it involves training employees from other departments who will be accessing these tools. Whether it’s employees who can use the latest HR software to opt-in and access their benefits or managers who can use the new HR technology to evaluate performance in a continuous manner. It’s also important to touch base with employees regularly once the implementation begins to ensure that things proceed seamlessly.

Leveraging analytics

HR technology generates vast amounts of data, depending on the workflow of the organization. There are two challenges in this. The first is whether the organization has the ability to make sense of that data and leverage it correctly. Even if the HR tool itself has advanced reporting and analytics, it can only be used to make more informed decisions if the personnel involved are able to understand and utilize these tools to extract actionable insights.

Overcoming the challenge

Having a proper strategy in place for leveraging data and using HR analytics is imperative, even before the implementation begins. It’s also important to make sure steps are taken to upskill HR teams and ensure that they are able to leverage analytics and gather important business insights. That way, the time saved from process automation can be diverted towards leveraging analytics and building a better strategy.

Another important thing to do before implementation is to decide what data will be looked at and what it needs to be used for. After that, there needs to be a large-scale effort to clean and organize existing data and enter it into the new HRMS systems.


Security and compliance

With cybersecurity becoming such a big issue, it’s important for companies to implement HR management systems that protect employment data from cyber breaches and virus threats. It’s also important to invest in an HR management system that is designed to align with all the regulatory requirements and compliances.


While there are some definite challenges to implementing HR technologies, they are by no means insurmountable. In fact, most of these challenges — whether employee buy-in or analytics preparedness — can be mitigated through careful planning and execution. As long as HR teams are aware of and prepared for some of these challenges, replacing manual systems and outdated processes is an absolute must.

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