How to Measure ROI for HRMS: 3 Experts Weigh In

Findings of KPMG’s HR Transformation Survey for 2018 disclosed that half of the 887 global C-suite respondents agreed that intelligent automation (IA) will disrupt conventional HR practice. The two most cited benefits from IA investment include improving employee performance and freeing resources to perform more strategic work.

As human resource management systems evolve, investment will increase. More companies will demand the inherent advantage of an HRMS solution, including HR transaction processing, value-added service delivery and improved management information availability.

HRMS ROI blog post by Better Buys

And while these benefits can be studied three, six, and 12 months after deployment, how should a company calculate the return on its HRMS investment and help justify its purchase?

We’ve asked three experts to answer that question:

Organizational automation delivers primary return

An HRMS delivers immediate value by organizing the information HR oversees, centralizing it for easier access, and handling transactional, data-heavy tasks that might take hours or days to perform in spreadsheets. These automation benefits can save an organization thousands of dollars in time and compliance issues while freeing HR from data entry to focus on strategic initiatives.

Over the long term, an HRMS may provide additional value in a number of ways, like increased hiring efficiency, more effective performance management, and increased engagement. Reporting features effectively double down on the benefits of automation; as the HRMS gives HR more time to spend on improving workplace culture, reporting provides the insights and intelligence necessary to plan and execute more effective HR programs.

BambooHR RobdeLuca

Rob DeLuca
Sr. Copywriter


Whether internal or out-sourced, automated administrative tasks return the investment

To outsource or not to outsource: that is the question.

Or is it?

At first glance, a human capital management software purchase may seem like just another added cost; however, when you consider the time spent by staff and risk associated with keeping payroll and HR functions in-house you may feel differently.

The time spent on managing the payroll process in-house, and the associated cost, may be much higher than you realize. Just ask the people who are responsible for payroll in your company how long it takes to run payroll from beginning to end.  Transferring data from one system to another also creates errors – errors that need to be fixed and can affect employees pay. Tasks like manual time keeping, on-boarding of employees and custom reporting can take hours – hours that could be spent on more important company initiatives.  If you want to save time on administrative tasks – automate!

Between the IRS, DOL, FLSA etc., laws and regulations continue to change.  With payroll, risks can include everything from incorrect calculations with outdated tax tables and late deposits and filings to disgruntled employees complaining about incorrect pay on payday.

When you purchase an outsourced solution, you can rely on a company that has expertise in compliance and keeps you up to date!  This means less errors and less risk for penalties and interest.  It also means that employees have access to their information through an employee self-service portal and can usually answer their own questions before taking up extra time with an HR or Payroll Director.

When there are so many quality companies to choose from, the question shouldn’t be whether to outsource or not, but rather – which company best fits my business needs!

Dan Neuberger, CEO, Viventium

Daniel Neuburger


A simple five-step process justifies investment and drives value

There are five simple steps we recommend for evaluating your HCM platform investment and getting it approved.

Step 1: Do the prep-work because it will pay off in the long run. Identify the key stakeholders in the decision-making process. Understand how an investment decision is made. Take inventory of tools and templates. Form a tactical help team.

Step 2: Confirm that your business case aligns with the needs and desires of non-HR decision makers and influencers. Identify the business goals, challenges and the workforce needs, and how success is measured.

Step 3: Propose a compelling solution. One size does not fit all, so in this step, you need to tailor your strategic solution to meet the needs of the business uncovered in Step 2.

Step 4: Articulate the benefits and facts. If clearly illustrated, this step will motivate approval. This should include a timeline, qualifying costs, benefits and expectations.

Step 5: Present your case. Steps 1 through 4 should help you form a focused, constructive business case. This final step will ensure you nail the presentation. Make sure you prepare for objections and tough questions, while finding ways to incorporate heart-wired stories to support your case.

By approaching any HCM investment with a solid business case, you’ll be on the right track to get the buy-in you’ll need to justify the investment and effect an even greater return.

LMS ROI Expert Opinion by Better Buys

Charles Var

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  1. Thanks for sharing the information..
    Cloud Payroll Software

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