The CHRO's Dilemma: Best of Breed or an Integrated HCM Solution?

Edwin Garcia, Chief People Officer, PPC Partners, Inc

Technology has become so pervasive in our lives that you can’t find an area that hasn't been or isn’t in the process of being automated. Nowhere is technology more present and evolving quickly than in our work environments. In our ever-present goal of improvement and seeking to reduce work and accelerate growth, many experiment with new processes and technologies to seek major efficiencies.

Although much progress has been made since companies started investing in human resources information systems (HRIS), there is still much more progress we anticipate now with the advent of artificial intelligence driven systems.

Yet there is a real human challenge facing senior human resource (HR) leaders, and that is, 'How do we reap the benefits of all these technological advancements in an effective and efficient way?’

To be certain, much has been written on the subject of HR technology and human capital management (HCM) systems, yet the leader’s decision is not to be found in academic journal articles or to be entrusted to outside consultants who have just a peripheral understanding of our organization. The selection of an HCM is more nuanced and requires a more intimate approach.

CHROs facing this challenge are bombarded by information and sales-driven solutions of two types. These are targeted single-function or fully integrated solutions (best of breed). Moreover, depending on the size and complexity of the company’s operations, a vendor may have different solutions targeting small, middle, or large company needs. Hence, the question of implementing solutions to address human capital management needs can be daunting.

To further complicate the solution selection, the company's overall needs may not be served by an HCM alone. This means an ERP solution might also be needed to satisfy the company's operational needs.

HR leaders find themselves in the middle of a decision they may not have prior experience with, trying to balance the organization's needs from an operational and human management perspective.

As a veteran of three such implementations, I can attest to the difficulty of the decision. Yet the preferred approach is not to reduce the choice to the selection of one integrated multifunctional HCM or cobbling together an array of single-point solutions woven together like a multicolored quilt.

The availability of an application programming interface (API) can yield an alternative by allowing applications to communicate with each other. The API acts as an intermediary layer that processes data transfers between systems, allowing the majority solution (HCM) to gain from the efficiencies and functionality of one or a few best of breed solutions. APIs help businesses connect the many applications they use in day-to-day operations, saving employees time and breaking down silos hindering collaboration and innovation.

Through the use of APIs, a hybrid solution targeting the unique needs of the organization can be achieved. A solution that offers the reliability to run efficient processes like payroll, onboarding, off-boarding, benefits administration, etc., together with best of breed solutions that provide ‘IPhone-like' intuitive ease of use for managers and employees while ensuring data security.

Remember that selecting an HCM solution is a strategic decision that requires a thorough analysis of your organization's needs and goals.