HCM ROI

The most critical parts of the process

ROI is one of the most critical parts of the process for any organisation. While teams may have goals and plans, securing executive and finance team buy-in is crucial to avoid projects falling through at the final stage due to budget constraints or cuts.

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ROI: The Cornerstone of Executive Buy-In

If ROI hasn’t been considered or executive buy-in is still pending, it’s essential to pause and get the necessary involvement before moving forward. ROI is about ensuring that what is spent results in more savings or value. It’s not always just about financial savings; cost reduction can also come in various other forms:

Compliance Costs: Avoid potential fines and risks associated with data breaches and compliance violations.
Reporting: Access to analytics can improve business processes and workforce management.
Lost Customers: Inefficiencies in processing and data management can lead to lost business opportunities.
Personnel: Automation may replace some roles as processes become more streamlined, saving costs.

ROI Analysis

In-depth ROI analysis for a business with 250 employees can easily reveal losses reaching a quarter to half a million pounds annually. This is why it’s vital to conduct a thorough analysis of your business functions and processes.

Present your findings to the board in a detailed business plan that demonstrates how much money you’re losing and the value of investing in a future-proof system that addresses key pain points.

Be a value-driven, not price-driven, customer. When working with providers, it’s critical to approach the process with a value-driven mindset.

Objections such as “You’re twice the price of our existing provider” or “You’re more expensive” are often raised. These objections stem from a price-driven approach that fails to account for the various variables discussed.

Examples of ROI preparation

ROI can be analysed simply or in great detail across these areas. To start, consider the cost of inefficiencies. Time and money are the easiest to calculate:

The Cost of Preparing an Annual Performance Report

This example demonstrates that one module of the HCM cycle is costing £64,400 per year in processing. Now, consider all your processes in the HCM cycle—time savings alone typically exceed the cost of a system.

Business A with 200 Employees

Business A has separate systems for Payroll, LMS, Time, and HR, while outsourcing recruitment. Each solution has its own cost and database. Consolidation could lead to significant savings.

When added to the cost of £64,400 for one process, the total cost is £149,360 annually—before considering time costs or additional inefficiencies.

The Power of Value: A Real-Life Story

Netflix, the world’s largest streaming service, decided to migrate its entire infrastructure from on-premise servers to Amazon Web Services (AWS). At the time, this was seen as a highly risky and expensive decision, with initial costs significantly higher than continuing to maintain their legacy systems. Critics questioned whether it was worth it.

However, the value-driven approach behind the decision was clear:

Scalability: Netflix needed to handle increasing global demand and expand its reach, which their legacy systems couldn’t support. AWS provided infinite scalability.
Reliability: Outages on on-premise servers disrupted customer experiences. AWS’s distributed architecture minimised downtime.
Data Insights: AWS enabled advanced analytics, allowing Netflix to leverage customer viewing data for personalised recommendations.

The Outcome
The migration took 7 years but enabled massive growth for Netflix, allowing them to go from a US-only service to a global powerhouse with over 230 million subscribers.
By focusing on value, Netflix avoided the limitations of on-premise systems and future-proofed their business. AWS’s advanced capabilities saved Netflix millions in potential downtime costs, infrastructure failures, and inefficiencies.

Providers

In the UK, businesses have a wide range of options to choose from. The UK is a hub for technology and a global innovator, home to many companies that have expanded globally and developed groundbreaking solutions. With experience working with both large and small software Providers, it’s clear that each type has its own advantages and disadvantages.

Having over 20 years of experience in software sales, it’s possible to share insights into what makes a great software Provider experience. The sales process is fundamentally about people working with people. Every salesperson brings something different to the table.

These differences can arise from their past sales experiences, the types of products they have worked with, the pressures they face, and their individual morals and personalities. Over the years, the sales process has evolved into many forms, but more often than not, organisations will find themselves engaging in a “solution selling” process.

How to Measure a Good Sales Experience

You might wonder, “How can I tell if they truly care?” Here are some key indicators:

They remember past conversations, even from weeks or months ago, without needing constant reminders.
They won’t hesitate to say, “This won’t work,” if a solution doesn’t meet your requirements.
They’ll ensure your expectations are realistic and won’t settle for less if your needs are achievable.

If your expectations are unrealistic or can’t be met, they’ll tell you upfront rather than forcing a “square peg into a round hole.” In fact, a great salesperson may even suggest another Provider who can meet your needs if they cannot.

They are not obliged to do this but I have heard and seen it done. This shows they genuinely care about you achieving your desired outcomes, rather than just making a sale.

What is Solution Selling?

In a nutshell, solution selling involves identifying all the pains and challenges your company is facing and providing the best possible solution to address them. It’s a consultative approach that is built on knowledge, relationships and trust.

A good salesperson will focus on building a rapport with you and your team, spending time understanding the ins and outs of your business.
Sometimes, they won’t just focus on the pains and issues you’ve identified but will help you uncover other areas you may not have considered. Typically, salespeople operating at this level are highly experienced.

If they’ve been in the SaaS (Software as a Service) industry for a long time, they will be supportive, understanding, and knowledgeable. Importantly, they will also have access to the right people or resources to find answers if they don’t know something themselves. Solution sales often have long sales cycles, particularly for prospects with over 250 employees, ranging from 3 to 12 months. Throughout this process, the salesperson should get to know you and your business so well that it feels like they’ve known you for years. This demonstrates genuine care and an interest in achieving the best outcome for you.

Communication and Transparency

Good communication is a cornerstone of solution selling. A strong salesperson will track all conversations, meetings, and interactions in their CRM system to ensure continuity and consistency. While emails have become common in the digital age, critical steps in the sales process should always involve direct communication, whether that’s a phone call or a meeting. Most reputable Providers record calls, demos, and other interactions. This is beneficial for both parties, as it provides a reference point for any discrepancies or accusations of mis-selling later on. It also ensures transparency and supports training and performance improvements for the sales team.

Human Capital Management Buyers Guide Index

Below, you’ll find an overview of each section, with links to the full content for deeper insights.

Introduction & Planning

Below, you’ll find an overview of each section, with links to the full content for deeper insights.

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HCM Core Components

Find out all you need to know on the essential elements that make up a comprehensive HCM system.

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HCM Cycle Overview

HCM Reporting

Compliance Data Security

Integration & System Considerations

HCM Functionality

Exploring the key features that drive workforce efficiency and engagement.

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Time & Attendance

Payroll

Access Control

Scheduling and workforce management

Recruitment and onboarding

Performance management and succession planning

Selecting an HCM Provider

Choosing the right provider is just as important as selecting the right software.

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Sales process and RFQ/RFP considerations

Sign off

Implementation & Success

Rolling out your HCM system smoothly and ensuring long-term success.

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Building an implementation team

Training

Budgeting and timeline considerations

Employee adoption and change management

Transitioning to Accountability: Change Management

In Summary

If you feel like you’re being pushed through a rushed process, questions, features, demo, quote, and a quick ask for the sale then the salesperson is not putting you first. You should feel a sense of relationship building. There should be a connection. You should see that the salesperson genuinely wants to understand your business inside and out, not just for now, but for the next 5–10 years. They should position themselves as a long-term partner who will provide expert advice and solutions whenever needed. At the end of the day, people buy from people. Make sure the salesperson values your business, understands its needs, and genuinely values you.

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