How to build a business case for a new HCM

Is your current payroll and HR system holding you back? Outdated processes, manual data entry headaches, and pesky errors that seem to pop up at the worst times – all sound too familiar, right? But there’s a catch: you're over it, but your boss still thinks your current HCM system is sufficient and sees no need for a change.

It may be tempting to just stick with the status quo, but don't stay stuck—take charge! Here’s everything you need to know about finding a new payroll and HR solution, from building a compelling business case to navigating the maze of HCM providers. We'll equip you with the tools and insights you need to make more informed decisions and lead the way toward new levels of productivity and effectiveness.

What is a business case?

A business case, similar to a proposal, is a document that outlines the reasoning behind why your organization should undertake a specific project or initiative. It serves as a persuasive tool to win approval from key decision-makers within an organization. A compelling business case analyzes all the necessary factors of the proposed project or initiative against alternative options, providing the rationale for the preferred solution. These factors include objectives, value, benefits, potential risks, costs, and other relevant considerations, allowing key stakeholders to determine whether it would be worthwhile to continue with your request.

Do you need a business case for an HCM solution?

Not every project or initiative will need a business case, but when you're desperate for a new HCM solution for improved productivity, accuracy, and control, a business case is crucial. Typically, projects or initiatives involving significant resources or investments require a business case to justify the change and ensure alignment with organizational objectives.

Switching to a new HCM system means adapting existing processes, learning new technology, and encouraging organization-wide adoption. While this change can be a steep learning curve, the benefits far outweigh the effort. That's why a solid business case is necessary— it helps explain why the investment is worth it and streamlines the process, ensuring the successful implementation of your new HCM solution.

Keep in mind, however, if the potential return on investment (ROI) is not compelling enough, hold off on finding a new HCM solution. Instead, focus on addressing current issues or finding alternative solutions to improve the efficiency and effectiveness of your current system.

How to build a business case

Now that you understand the importance of making your case, follow these six steps to gain the confidence you need to build a compelling business case that will secure buy-in from key decision-makers within your organization.

1. Identify the problem & opportunity

The time has finally come to bring awareness of your everyday pain points and address them head-on by demonstrating the need for new HCM software. Explain why the current situation is not ideal and prove how new software can tackle all those payroll processing and HR inefficiencies.

Discuss all the added benefits a new HCM solution can offer and the consequences of not taking action. Show how new HCM software will support business goals and the kind of return on investment your organization can expect, such as streamlined processes, increased productivity, reduced errors, and redundant tasks.

Essentially, you're connecting the dots between the problem at hand and how addressing it can positively impact the performance and success of your organization — establishing the urgency and importance of the issue.

2. Research solutions & analyze alternatives

Next up is research. Explore and evaluate possible HCM software options available. Compare the pros and cons of each option. You’ll also want to show how your options can scale with your organization during challenging times. Consider assumptions, dependencies, and constraints or limitations that may affect implementation.

Once your list of options is locked in, take some time to speak to your top 3–5 providers. Most offer short demos and can give you a quote based on your product needs and the size of your company.

Now, summarize your findings and highlight the value and unique features of your preferred HCM solution. This process will help identify the option that best aligns with your organization and provides a solid justification for your choice.

3. Anticipate implementation challenges

Think of any project or initiative your organization has decided to undertake in the past. They rarely go as planned. Like with any project, HCM implementation is the same. It doesn't happen overnight and requires a fair amount of legwork. So, to persuade your organization's key stakeholders to upgrade your current HCM system, you have to plan for reality and not perfection, meaning you need to get technical and assess potential risks.

Start by identifying the sources of unexpected challenges and risks that might occur during or after implementation and share your plan for how to overcome them. Propose mitigation strategies and formulate contingency plans to reduce or eliminate any impact they may have on your organization. Effectively setting expectations with your stakeholders and buying committee is a skill that will serve you well now and when you eventually implement that new HCM system.

This is also where you might want to ask your IT department a few questions before going further. To give stakeholders an accurate overview of where you’re at technically, you’ll need to provide information on whether the new HCM software options meet your organization's device and security policies, especially if looking at a system that empowers your workforce through self-service options and mobile applications.

4. Be prepared for questions & opposition

Before you present, take time to consider the purchase from the perspective of different roles within your organization. Come up with a list of potential questions, objections, and feedback you may receive, and be ready with solutions to address those concerns with confidence and evidence. Ensure every aspect, from planning to execution to monitoring, is thoroughly considered and anticipated. You’ll most certainly run up against questions about cost and ROI, training and implementation timelines, and perhaps, even opposition from stakeholders who believe the current HCM software is fine.

5. Present to persuade & influence

Now is your chance to effectively present your case to the key stakeholders within your organization, including payroll and HR professionals, finance teams, and IT personnel, to gain the support you need to implement that new HCM system.

Put it all together and paint the picture with your presentation. Tailor your message to your organization's primary decision-makers, and highlight your key points and recommendations while addressing their concerns, interests, and expectations — this will go a long way towards winning them over.

A great way to look at your presentation planning is to show progress. It can be tempting to stick to just facts and figures to do all the convincing, but really, it's telling a great story that's the trick to grabbing attention. The more your story conveys an emotional or personal connection, the more memorable and lasting impression your case will make. Start with where you are now, move on to the alternatives, and what moving forward can look like for the entire organization. Keep your language concise, but explanatory enough that your presentation can be shared with other stakeholders.

Focus on budget – the cost to implement and train and what the benefits are. Give examples of where you see the new HCM solution taking you, for example, a 40% reduction in costly payroll errors or an annual savings of $20K in payroll processing costs. Not sure what kind of returns you’d see with a new HCM solution? Check out our case studies to see how clients saved when they switched to Avanti.

6. Gain approval

Now that you’ve made your case, the rest is up to the key decision-makers. Sometimes the best business cases are denied. If it’s a “no,” don’t be discouraged. At Avanti, we’ve worked with companies years after they’d initially passed on new software. It’s all about timing.

Keep your presentation on hand and update it as needed, including stakeholder feedback and demonstrating the value proposition of your preferred solution. Then, when the time is right, make your case again.

5 steps for finding the right HCM

The search for a new HCM solution can be a lengthy and overwhelming process. Here are five steps that will help guide you through this journey to find the right solution for your organization.

1. Research providers: Research and evaluate at least three HCM providers in order to explore available options in the market. Consider making a checklist with factors like features, vendor reputation, pricing models, customer support, and compatibility with your existing systems to evaluate each option thoroughly. If your organization usually employs an RFP process for vendor selection, consider creating one for this purpose.
2. Develop an evaluation methodology: Create a structured approach to assess and compare the potential HCM providers you're considering. This may involve creating a scoring matrix or checklist to rate each vendor based on specific criteria, such as functionality, ease of use, implementation timeline, and total cost of ownership. Collaborate with relevant stakeholders to ensure your method aligns well with your organization's priorities and requirements.
3. Request demos and pricing: Reach out to your top chosen providers to schedule product demos and gather pricing information. Look for a vendor that puts in the effort to build a demo environment that feels like home. If your prospective vendor cuts corners in the demo and doesn't speak to the issues you're looking to solve, this could be a cautionary sign for the implementation experience ahead.
   
   Be sure to ask your prospective vendors for a quote that provides a detailed breakdown of all costs involved. You’ll want to know ahead of time if there are extra costs for project management, implementation, software training, upgrades, additional modules, etc. Seeing the software in action and understanding the total costs involved will help you make a better-informed decision.
   
   
4. Compare and rank alternatives: Score and rank each vendor based on how well they meet the criteria you outlined in your evaluation methodology. This will help narrow down your choices and identify the top contenders that best align with your organization's feature and budget requirements.
5. Now for the exciting part – decision time!​ Select your top HCM provider that most closely aligns with your organization's needs and goals based on the results from your evaluation and decision-making processes. If you’ve done a good job of convincing the powers that be, your boss may be ready to meet with your recommended provider and see a demo. At this point, you should collaborate with your top choice and share your organization’s questions and concerns. By addressing these ahead of time, your prospective provider can address issues specifically and save your team some time.

Congratulations! You can now start negotiating terms, finalizing contracts, and preparing for the implementation phase of your new HCM solution – taking that step to set your organization up for success!

Conclusion

By recognizing the limitations of your current payroll and HR system and embracing the need for change, you've already taken the first step toward a better solution. However, this only marks the beginning of your new HCM journey.

While the road ahead may seem daunting, remember you're not alone. With the right tools and strategies in place, you can drive transformative change, unlocking new levels of productivity and effectiveness within your organization. Embrace this opportunity to streamline processes, empower your team, and elevate organizational success.

We've done our part. You now know how to build a killer business case and find the right HCM solution for your organization. It's all you now. You've got all it takes to make a profound impact. Get out there and lead the way!

Additional Reading Links

1. Making the case for better payroll & HR software
2. How to find your HCM match
3. HCM: Everything you need to know