Guide to Buying HR Software for Your SME 

Looking to buy a HR software for your small business in India? You have come to the right place. In this article we discuss why more SMEs today are investing in HR tools and digital solutions, and how investing in a HRMS software can enable your SME to grow and solve multiple business challenges. 

A few things to remember before diving deep into HR software selection: 

  • An HRMS solution is as important to your business as any other sales, marketing, finance or compliance software 
  • There are several high performing HR business software in the Indian market today, focusing on diverse HR functionalities e.g., attendance, payroll, performance, core HR etc.  
  • Not all HR tech is for SMEs, as some tools are built keeping the needs of larger enterprises in mind  
  • It is recommended to have representation across teams/departments in the software evaluation and selection process to ensure that the right HR tool is finalized 
  • A software marketplace is a good place to start learning about available options in the market before starting discussions with vendors 
  • The various points in the checklist should not be considered in isolation, i.e., you can follow the steps in parallel  

On that note, let us now help you shop for HR technology for your SME. 

Checklist for selecting the right HR software solutions for small businesses 

Buying a new HR application can be overwhelming. The evaluation process will be tedious, implementation and onboarding will be required, and not all will be thrilled about adopting new tech (some might also find using a new software complex). 

As a business owner aiming for growth, what would help is a guide on the do’s and don’ts for selection. Let us help with that: 

Identify the challenges you aim to solve with HR solutions 

One of the common HR software buying mistakes is not having clarity on the challenges a HR tool can help to resolve.  

Most tools available in the market today are powerful applications that cater to specific HR functions (e.g., workforce management, talent management, performance, payroll, employee self-service etc.). As a MSME owner, you must be able to identify the key challenges your business is facing and find a HR tool that will help to solve it. For instance: 

Business challenge Employee payroll management 
HR software recommendation TCS iON Payroll 
Helpful features and functionalities Cloud-based HR payroll software for end-to-end employee payroll management Error-free payslip generation as per compliance with details on tax, PF, investments, expenses etc. Salary processed on the basis of leaves, attendance, holidays, vacation and other details 

Research and shortlist the top HR software for your SME 

The next item on your checklist should be to do market research and shortlist HR software vendors. This is probably going to be the most challenging task since all vendors will at this stage provide exemplary support, detailed product demos, and patiently answer all queries.  

Here’s what you can do: 

  • Identify the key pain point the HR software will help to solve 
  • Understand how the software features will solve that problem  
  • Check how easy it is to install and use 
  • Evaluate if it is simplifying current processes or adding more steps to it 
  • Assess if you can automate processes with HR solutions 

This will help you to eliminate software that won’t serve the end goal. 

Identify stakeholders involved  

When you identify stakeholders involved, consider the following: 

  • Stakeholders who are the buyers/decision makers 
  • Stakeholders who are the end users 

This will help you to finalise a software that meets the business end goals, can easily be implemented and used by all, and meets the budget constraints. For example: 

HR problem to solve Remote employee time, attendance, and payroll management 
HR software buying team (decision makers) SME owner Senior managers IT head HR managers 
Other involved stakeholders (influencers) Departmental heads Subject matter experts 
Actual users Employees using the tool daily HR team Reporting managers 
Recommended HR solution HR payroll software  Comes with employee self-service portal for employees to login and update data, download payslips etc. Can be accessed anytime, anywhere by HR teams, managers, and other authorized users Simplifies location-based attendance tracking (geo-tracking enabled) and payroll processes Generates analytical reports for informed decision making 

Understand how the software will be implemented and used 

The next thing on the checklist should be to assess the current HR systems in use and how new tech integration will affect it. 

This is a critical step as many small businesses often do not have digital technologies in place, and often rely on paperwork or simple online sheets/files for managing data. The shift from manual to digital will be challenging, especially if it involves additional training and learning. 

Some of the simple selection criteria can be: 

  • Cloud-based HR software system – This does not require any hardware installation and can be ready for use within a couple of hours 
  • Device compatibility – Mobile access makes it convenient for remote users to use the tool  
  • Scalability – Capability to add more users and value-added functions as your business grows and expands 
  • Flexibility – Features compatibility (static or dynamic features), with the option to be customized as per need 
  • Complexity – Ease-of-use by all, without seeking support and guidance 
Listen to what other users are saying  

Reviews and feedback about the HRMS solution are the next things that should be on your checklist. Reviews and feedback are not the same as doing research on products.  

Product reviews can easily be found online. You can find them on review platforms, social media sites, technology websites, or even software marketplaces. The important thing about product review is that it is specific to the product i.e., the HR software for SMEs. It will highlight the features, performance, pros and cons, cost and value for money etc. It’s a good place to learn about a product but try not to make decisions based on it entirely. 

Feedback on the other hand is usually provided by customers after using the product. It involves feedback on the overall experience including the HR software buying experience, feedback on vendor, customer support, installation process, challenges faced and how it was managed etc.  

As a business owner looking at buying a HR tool for business, consider both reviews and feedback. 

Closing thoughts: HR software selection tips 

You have your checklist ready and should now be well equipped to buy a HR tool for your SME. There are several HR software in India that you can consider, research, evaluate, and decide. 

As a closing thought, remember that the goal of the tool should be to simplify processes and serve the end business goals. If the tool is not providing either, or does not contribute to RoI in the end, it is not a worthwhile investment.  

Hence, involve all key stakeholders in the decision-making process, understand key pain points, and find a HR solution that will enable your SME to accelerate growth. 

Leave a Reply

Your email address will not be published. Required fields are marked *