Here’s a scary stat: the average cost of keeping a disengaged employee is 34 percent of his or her salary. So if you’re paying an employee $100,000 per year and they are disengaged, it is costing your organization an additional $34,000 per year. It’s clear that disengagement is a huge issue for a company’s bottom line, but what else does disengagement affect?

The panelists from our panel, “The ROI of Engaged Employees and the Cost of Disengaged Teams” at Illuminate all agreed that culture is what’s happening, but engagement is what people think is happening. During Silicon Valley’s boom, engagement was often conflated with perks. If you provide more perks, your employees will be more engaged. This no longer holds true.

Here’s what happens when you have disengaged employees:

Ultimately, engagement stems from a fundamental lack of trust. At companies with large percentages of disengaged employees, rumor mills run wild, and truthful sources of communication are nonexistent.

Often, this culture of distrust can be caused by a change in leadership, which is a common issue in high growth organizations. But how do we fix this? David Hanrahan, vice president of people at Niantic, thinks that “leadership needs to own engagement.”

Action planning on engagement surveys is incredibly difficult for organizations, but one way to promote actionable insights is to ask employees about their motivators. Why do they come to work? What makes them want to do better? Questions like these help provide people leaders with very specific, highly actionable data that can ultimately lead to higher engagement.

What to do about attrition

Intent-to-stay data is the most useful engagement question to predict attrition. If you ask people how long they plan on staying with your company, you’ll be surprised on the honesty you receive back. It’s that simple.

In tech, people perform their best after six months, and their lowest after years. Engagement survey data can help address engagement issues to solve for the loss in productivity in between these periods.

Performance management is about enabling people to do their best work, not about determining how to decide who moves up and gets promoted. If you invest in your performance management program, employee career growth will happen organically.

We had the pleasure of sitting down with Pattie Money, CPO of SendGrid, to discuss architecting performance management programs for today’s workforce along with our very own Vice President of Employee Success Rachel Ernst.

Nowadays, in the tech industry especially, promotions are handed out left and right. Often, companies think that implementing a performance management program will help facilitate promotions and career planning, without having to do much to tailor their programs to their specific organizational needs. And this is where performance management goes wrong. There is no destination to implementing performance management because it is ever evolving, just like your workforce.

How to increase feedback

The good news is that most people are well intentioned and don’t resist the idea of giving feedback, they just don’t know how to do it. For managers without proper training, it’s much easier to “ditto” in giving feedback than it is to think more intentionally and this is why you need to invest in training your managers in order to make your program successful.

How to address the “I don’t have time for that” problem

Managers are busy people, but it’s important to communicate to them that if they “don’t have time” for feedback, they shouldn’t be managing people. It may sound harsh, but employees put their careers in the hands of their managers with the expectation that they will be developed. If managers fail to give feedback, they fail to be good managers.

Pattie says that it’s important for managers to ask themselves if setting aside a few hours twice a year is too much to ask for the success of their employees.

[bctt tweet=”Is it too much to ask to invest in your people? – Pattie Money, CPO at SendGrid ” username=”@reflektive”]

Just a week after our 5th birthday as a company, we are happy to announce that we were ranked 3rd in the Bay Area and 13th in the Nation on Deloitte’s Technology Fast 500™, recognizing the 500 fastest growing technology, media, telecommunications, life sciences and energy tech companies in North America.

Fueled by our mission to help employees and managers work better together, our business grew a total of 8,240 percent from 2014 to 2017 as over 500 companies such as Comcast, Instacart, and DigitalOcean use our platform to create a culture of feedback.

SEE ALSO: How to Effectively Change Performance Management

“Our growth reflects our commitment to meeting customer needs through innovative products that drive real, measurable change,” says Reflektive CEO Rajeev Behera. “Employees need to know where they stand and where they are going — we are glad to see so many companies adopt the tool that helps them drive this value.”

[bctt tweet=”We have grown a total of 8,240% from 2014 to 2017. ” username=”reflektive”]

“Congratulations to the Deloitte 2018 Technology Fast 500 winners on this impressive achievement,” said Sandra Shirai, vice chairman, Deloitte LLP, and U.S. technology, media and telecommunications leader. “These companies are innovators who have converted their disruptive ideas into products, services and experiences that can captivate new customers and drive remarkable growth.”

Our people management platform helps managers adopt the behaviors proven by research to enable employee development and performance. Real-time feedback and check-ins drive coaching and development, our recognition and 1-on-1 profiles drive care and recognition, goal management drives strategy and vision, and reviews and analytics drive accountability. 

[bctt tweet=”Employees need to know where they stand and where they are going. ” username=”@reflektive”]

About Deloitte’s 2018 Technology Fast 500™

Deloitte’s Technology Fast 500 provides a ranking of the fastest growing technology, media, telecommunications, life sciences and energy tech companies — both public and private — in North America. Technology Fast 500 award winners are selected based on percentage fiscal year revenue growth from 2014 to 2017. 

DOWNLOAD FREE E-BOOK: How to Transition Annual Reviews to Real-Time Feedback

In order to be eligible for Technology Fast 500 recognition, companies must own proprietary intellectual property or technology that is sold to customers in products that contribute to a majority of the company’s operating revenues. Companies must have base-year operating revenues of at least $50,000 USD, and current-year operating revenues of at least $5 million USD. Additionally, companies must be in business for a minimum of four years and be headquartered within North America.

CONNECT WITH US: Reflektive on Twitter

The significant increase of automation and artificial intelligence (AI) in the workplace is having a dramatic impact on the way we work, the job market, and employee expectations.

Already, 72 percent of Americans worry that AI will take over their job and could make them obsolete. Their concerns aren’t entirely unfounded, as AI is predicted to eliminate about 1.8 million jobs in 2020. On the flip side, it is also estimated to produce 2.3 million new jobs in the same year, a net gain of half a million jobs. In 2021, Gartner predicts AI will also generate $2.9 trillion in business value and 6.2 billion hours’ worth of productivity improvements.

[bctt tweet=”AI is predicted to eliminate about 1.8 million jobs in 2020.” username=”@reflektive”]

In light of these changes and opportunities, organizations of all sizes and across industries are under tremendous pressure to create and execute workplace automation strategies that take advantage of the AI revolution while minimizing risks of talent exodus, skills deficits, and technological deficiencies. However, only 10 percent of executive HR leaders have an organizational strategy in place to deal with the potential risks posed by automation.

[bctt tweet=”Only 10% of executive HR leaders have an organizational strategy in place for AI risks.” username=”@reflektive”]

If your organization is one of the many that could use some help in preparing for — and making the most of — the AI revolution, here are five ways leaders can collaborate to use AI and automation to address talent management, business performance, and growth priorities:

Automate HR Functions

Automated candidate sourcing tools and onboarding solutions have already enabled HR to become much more efficient, and the addition of AI can further refine talent selection and retention processes. With AI, HR departments can home in on qualified candidates faster, using data analytics to match employees with organizations based on company needs and employee expectations. As AI handles more and more of the day-to-day HR operations, HR pros can become strategic advisors and administrators, focusing on more high-touch work.

Improve Decision Making

Combining AI data analysis with human knowledge and intuition — what many call the “centaur model” — gives business leaders the ability to predict trends and prepare in advance to capitalize on emerging opportunities. HR pros and managers can be more proactive about hiring and people development needs, which gives the organization a significant advantage in today’s tight talent market.

Similarly, as an organization grows and becomes more complex, its teams become more difficult to manage. With AI and automation, you can leverage more data at scale with less human intervention to grow your business faster and more easily.

Grow Your Business Intelligence Talent Pool

The increase in business intelligence offered by AI and automation technologies won’t just change the HR function — it will change an entire company’s way of innovating, operating, and growing. To leverage this opportunity, you’ll need to be prepared with the right talent on board. Demand for AI-savvy talent has skyrocketed. If you have not already begun to build a business intelligence talent pool, get started now.

Invest in Coaching and Upskilling

One of the best ways to build a talent pool that is prepared to leverage AI and automation technology is to invest in coaching and training for existing employees who may be at risk of losing their jobs to new advancements.

Cultivating a culture of real-time feedback and development will help you build the knowledge and skills your company needs to succeed in the new business environment while saving you time and money associated with talent acquisition. An emphasis on internal development also allows your company to preserve and take advantage of institutional knowledge among existing employees.

Furthermore, the valuable educational opportunities offered to employees may well boost retention and engagement. AI and automation can actually help in this endeavor. By analyzing data related to an employee’s status, role, satisfaction, engagement, and sentiment, AI systems can catch disengaged employees before they become problems or leave the company. Then, HR can step in to deliver the perfect training the employee needs to learn new skills they can use to succeed in the digital business age.

[bctt tweet=”AI and automation can actually help boost retention and engagement.” username=”@reflektive”]

Support Corporate Diversity and Inclusion

As companies increasingly recognize the impact of diverse perspectives on innovation, employee engagement, and customer experiences, more and more organizations are making diversity and inclusion top priorities.

AI and automation technologies can support diversity and inclusion initiatives by combatting unconscious bias, helping HR pros and hiring managers make hires based on talent and propensity for learning rather than traditional attributes like years of experience or education.

Be mindful, however, that AI and automation are not silver bullets when it comes to solving the diversity challenge. Even the best AI-based diversity hiring solutions may come with their own biases programmed in. As is the case in any AI-influenced decision-making process, technology should be a tool to educate and inform, not a substitute for human creativity and empathy.

The arrival of AI and automation in the workplace is poised to change forever the way employees work and the way HR pros and leaders hire, inspire, and manage employees.

By creating and implementing contemporary people management strategies that take advantage of the future of work today, executive teams can position their organizations to remain competitive in both the talent market and the wider business environment for years to come.

The original article was published September 26, 2018 on Recruiter.com. 

Employee performance and success are most likely a challenge in your fast-changing, digital business environment. And there’s no need to fan the flames of this challenge with unnecessary disengagement between managers and employees. Right?

Essentially, a manager’s primary job is to help their employees be successful.

One tenet behind #NoBadManagers we’ve been talking about lately is make it very easy for workplace relationships to form and grow by removing counterproductive friction. What are some examples of friction points?

• Lack of easy access to employee performance and relationship insights
• Poor preparation before manager and employee conversations take place
• Ineffective follow-up after manager and employee conversations

These issues aren’t new by any means but they continue to linger and negatively impact – exponentially – most organizations today because of the sheer amount and velocity of information that’s being created by people and technologies.

Introducing 1-on-1 Profiles

1-on-1 Profiles, announced at HR Tech 2018, provides a single place for managers and employees to quickly get up to speed for employee relationship development and productive 1-on-1 conversations. High-level benefits include:

• Everything in one place: Feedback, goals, reviews, notes, agenda – it’s all here for effective 1-on-1’s
• Focus on what matters: Collaborate on 1-on-1 agendas, not manual data entry and status updates
• Improve teamwork: See what others are focused on to improve alignment and collaboration

“The key to a good one-on-one meeting is the understanding that it is the employee’s meeting rather than the manager’s meeting,” said Ben Horowitz, cofounder and general partner at A16z. “This is the free-form meeting for all the pressing issues, brilliant ideas and chronic frustrations that do not fit neatly into status reports, email and other less personal and intimate mechanisms.”

The 1-on-1 Profiles user experience is a 3-column format with the left column providing basic demographic information and a feedback button. Immediately below is a direct reports summary by photo, name and title to quickly review and dive into individual 1-on-1 Profiles.

The middle column is the Activity Feed including real-time feedback and reviews for the profile you are browsing at the time. This includes being able to see related information in chronological order.

The right column is reserved for Goals and Agenda. It’s the same UX as the prior two columns – you can easily skim summary information and click for more complete details.

Customer Needs and Use Cases

We’re all consumers first and our user experience (UX) expectations are very high when you consider how we have either grown up or quickly adapted with social media, mobile phones and software-enabled tools.  The 1-on-1 Profiles UX has a familiar, lightweight feel that encourages daily use and easy adoption.

One use case is, new managers to an established team can view all previous performance reviews or check-ins in chronological order to quickly get up to speed on all employees for relationship building, skills assessment, coaching clues, etc.  The frog design team is all about UX:

“The best user experience is a top requirement when selecting people management software,” said Lindsey Ducroz, Director of U.S. Human Resources at frog. “With the 1-on-1 Profiles announcement, Reflektive reinforces their understanding of the value of easy, intuitive layout and design for supporting manager and employee relationships. 1-on-1 Profiles contain critical details about an employee’s performance history and manager’s dialogue in an easy to digest format to help create meaningful conversations, career continuity and achieve business outcomes.”

Another use case is a manager’s ability quickly prepare for goal and career development discussions, organizing thoughts for the most effective 1-on-1s with the least amount of time required. The Foursquare team is all about using data insights to create more powerful experiences:

“One of our core values here at Foursquare is to listen to every voice, and Reflektive helps us to do just that,” said Meghan Lapides, SVP of Human Resources at Foursquare. “Our business is all about enabling people and businesses to enrich their experiences and inform better decisions with real-time data insights. I’m excited about Reflektive’s new 1-on-1 Profiles capability because it will enable our team members to effortlessly access employee experience and performance-related insights to help managers and employees work better together at scale with always-changing priorities.”

Want to learn more about how the Reflektive platform can help managers and employees work better together?  Visit our product page and request a demo.

DOWNLOAD FREE E-BOOK: The Ultimate Guide to 1-on-1s

Labor Day is coming up this weekend, so instead of telling you to kick back, relax, and forget about work, we’re giving you a few podcast recommendations to focus on your professional development.

Thanks to podcasts like This American Life and Serial, podcasts have become increasingly popular in the United States and abroad in the past few years. In fact, according to Apple, there are over 550,000 podcasts available as of June 2018.

SEE ALSO: Managing a Multigenerational Workforce in the Age of The Millennial

With so many podcasts available to us, it can be difficult to find which ones can actually provide value. So, to save you some time, we wanted to recommend a few great podcast episodes on management and leadership so you can start learning and improving on your day off. Whether you listen to them at 3x speed or you take every word to heart, these episodes will be sure to give you valuable management knowledge and advice.

Masters of Scale by Reid Hoffman – How to Make the Star Employees You Need

If you’re having a difficult time hiring the right employees, you might want to try a different approach to growth. This episode of Hoffman’s prolific podcast brings to light the little-known strategy to employee development and building strong teams. Google and Yahoo!’s Marissa Mayer discusses her experience at Google building the search-giant’s first product manager training program when the company was fewer than 40 employees and kept hitting walls during the recruitment process.

The GaryVee Audio Experience by Gary Vaynerchuck – Building Company Culture, Keeping Employees Happy & Why You Need to Be HR, CEO 

In true GaryVee fashion, this podcast is fast-paced, sharp, and full of actionable advice. In this episode, Gary dives into how leaders can promote a positive company culture by figuring out how to motivate your unique employees.

Dear HBR: Bad Bosses

Ever wondered what your direct reports say about you behind your back? If yes, then this is the podcast episode for you. Hosted by two senior editors at the Harvard Business Review, Dear HBR: is the newest podcast series on how to be a good manager, or rather, how to avoid being a bad manager.

The Nice Guys on Business – Being an Active Viral Leader

This episode of The Nice Guys on Business will help you go beyond goal setting and give you some real life advice on how to advance your leadership skills and management presence.

HBR IdeaCast – Ask Better Questions

Last on this list we’ve included another great episode from one of HBR’s other podcast series. Often one of the last things holding leaders back is their lack of awareness of which questions to ask. This episode focuses on how managers and leaders can achieve faster business results by simply asking better questions.

What are your favorite podcasts on leadership and management? Let us know by tagging us on social media @reflektive on Twitter, Instagram, Facebook, and LinkedIn!

BONUS PODCAST: HR Happy Hour – Creating a Culture of Performance Based on Feedback

Digital business transformation across most departments in the enterprise has been well underway for several years. Now more than ever, people management processes are undergoing digital transformation when considering what’s most important to CEOs.  

A recent survey by Gartner, Inc. focused on 2018 priorities, forty-seven percent of CEOs said they are being challenged by the board of directors to make progress in digital business, with fifty-three percent of CEOs saying “growth” is their top priority.

[bctt tweet=”53% of CEOs say “growth” is their top priority.” username=”@reflektive”]

Digital HR transformation is a huge opportunity to enable managers and employees to work better together for driving growth and business performance. We recommend three areas to focus on:

1. Create more people management process agility and responsiveness given changing employee and customer experience expectations
2. Become a real-time culture with in-the-moment coaching, development and recognition rather than rear-view mirror performance reviews delivered with bias
3. Scale diversity and inclusion (D&I) strategies and results with data-driven decision-making across core people management processes

Let’s Focus on Diversity and Inclusion (D&I)

D&I is becoming more of a CEO and HR mandate given its compliance roots and because there is evidence of organizations that embrace D&I perform better than those who don’t make it a priority. In their Trailhead training resources on the “Business Value of Equality” – Salesforce provides a good definition of D&I in the workplace with this excerpt:

In terms of how D&I helps companies grow and succeed, let’s use the example of product and service innovation in the workplace which requires new and creative ideas from different perspectives. Teams including people with similar backgrounds who think the same way will rarely challenge each other. Whereas, meaningful innovation requires a variety of ideas, creative conflicts and feedback loops to help foster breakthroughs and adoption. Innovation is even more powerful in terms of business impact when managers, employees and executives are aligned around corporate goals and key performance indicators.  

In this recent blog by John Kostoulas, research director at Gartner Inc., he said that “Gartner has been consistently highlighting to business leaders the positive effect diversity can bring towards better decision making, appreciation of customer needs and innovation, all these magnified when an organization achieves a culture of inclusion. The end result is better business performance.”

Further, Kostoulas shares the importance of technology to enable and scale D&I – this new Gartner report including Reflektive provides more insights. And our recent Growth Divide study sheds some light on the emphasis of D&I for today’s real-time, digital business world. Not surprisingly, 46% of executives say they would like to incorporate better diversity initiatives into their people management strategies, and 48% of executives want to create more opportunities for employee mobility with horizontal and vertical moves within their business.

D&I Success with Reflektive

Increasingly we’re seeing our customers apply D&I thinking to help their organizations transform people management processes including performance reviews, real-time coaching and development, goal alignment, and people insights. C-level executives, HR leaders, people managers, and IT champions are collaborating in agile teams to design, implement and iterate systems of innovation and systems of differentiation for their digital business environments with established HR systems of record that support – for example – applicant tracking, payroll, and compliance activities.

Interested in learning more about how to successfully drive your digital HR transformation? Rachel Ernst, VP of Employee Success at Reflektive, shares how to manage successful change in this brief blog and video interview.

While OKRs have been around for more than a decade, we’ve seen a huge increase in interest from our prospects and customers in the past year. OKRs, or objectives and key results, are staples at companies like Google, Amazon, and many other Fortune 500 Companies, and now many smaller organizations are looking to implement the innovative goal-setting technique.

SEE ALSO: Why Facebook Employees Are More Productive, Motivated, and Satisfied

Several Reflektors took the time to read John Doerr’s newest book on OKRs this past week and we wanted to share our favorite quotes from the book with you.

Not only does this book prove the necessity of OKRs, it also provides HR leaders with the tools and advice to implement the straightforward goal-setting technique in their organizations.

If you can’t get your hands on a copy, or if you’re just waiting on your Amazon delivery, enjoy our favorite hand-picked quotes from the book here:

1. “Annual performance reviews are costly, exhausting, and mostly futile.”

2. “Business leaders have learned that individuals cannot be reduced to numbers.”

3. “Continuous recognition is a powerful driver of engagement.”

[bctt tweet=”Continuous recognition is a powerful driver of engagement.” username=”@reflektive”]

4. “By clearing the line of sight to everyone’s objectives, OKRs expose redundant efforts and save time and money.”

5. “Transparency seeds collaboration.”

6. “Nothing moves us forward like a deadline.”

[bctt tweet=”Nothing moves us forward like a deadline.” username=”@reflektive”]

7. “To win in the global marketplace, organizations needs to be more nimble than ever before.”

8. “Objectives and key results are the yin and yang of goal setting.”

9. On startup funding: “Structured goals give backers a yardstick for success.”

10. “OKRs are clear vessels for leaders’ priorities and insights.”

11. “Healthy culture and structured goal setting are interdependent.”

DOWNLOAD FREE E-BOOK: How Google Manages Goal Setting and Performance Management

We live in a world clouded with hundreds of thousands of apps. In this case, I’m not talking about Instagram or Venmo – but rather B2B cloud software applications.

SEE ALSO: Managing a Multigenerational Workforce in the Age of The Millennial

As someone who works in software, I am frequently juggling anywhere from two to 10 different cloud software applications on an average day. From Box to Salesforce to Reflektive’s own internal feedback tool, I find myself logging in and out of different portals every few hours to find what I need.

Just yesterday, I took a quick mental inventory of all SaaS applications my team at Reflektive uses and it easily surpassed 10 applications. While many of these cloud computing services offer integrations with each other, there are a staggering amount that lack them.

Reflektive, for example, integrates with both my Slack and my Gmail (among other integrations) – making my feedback experience with both of those applications seamless and streamlined. But for the applications that do not offer integrations, I find myself forgetting where to find them, or worse – forgetting about them all together.

Can’t Find it, Won’t Use it

Adoption rate is a huge success metric when determining the quality of a SaaS application and low adoption rates are directly tied to the usability and functionality of a tool.

In 2019, the SaaS technology industry is projected to bring in $201 billion in annual revenue.

[bctt tweet=”In 2019, the SaaS technology industry is projected to bring in $201 billion in annual revenue.” username=”@reflektive”]

If users have to visit a separate portal, log in, and spend minutes searching for information – they are not likely to adopt and engage with the application.

Just as my team at Reflektive utilizing somewhere around 10 to 20 SaaS applications on a daily/weekly basis, data shows that the average SMB organization has about 14 different cloud app subscriptions.

When apps offer integrations, those integrations serve as a reminder about the app, which can aid in engagement and frequency of use.

Without these integrations, apps can fall victim to getting lost in the sea with all of the others and ultimately, if none of your employees are using and engaging with a tool, then decision-makers are unlikely to renew the software’s license.

[bctt tweet=”When apps offer integrations, those integrations can serve as a reminder about the app.” username=”@reflektive”]

Staying Within Your Workflow Increases Productivity

Productivity is where integrations pack the biggest punch. If executed right, integrations keep your application top-of-mind by living within an employee’s existing workflow. Plug-ins and Chrome extensions are great examples of solutions to keep your application top of mind for users — while also staying out of the way of their normal operations.

One way Reflektive takes advantage of the convenience of plug-ins is by allowing users to give real-time feedback within their native Gmail, Outlook, or Slack applications. With a few simple clicks, employees are able to say thanks or give constructive feedback to their peers or managers – all without leaving their browser or web page.

Without the convenience of the plug-in, users would need to open a separate tab, type in the web address and spend time logging in from there.

[bctt tweet=”Integrations keep your application top-of-mind by living within an employee’s existing workflow.” username=”@reflektive”]

There’s a Reason Why Single Sign On (SSO) Software is So Lucrative

Login times have proven to be a huge waste of money when added up throughout the course of a year. Though it’s surprising, the minutes wasted everyday logging in can be detrimental to daily productivity and an organization’s bottom line. In fact, the average size SMB company stands to lose almost $15,000 per year on login time alone.

By cutting down on login times and time wasted finding the right application, integrations allow users to spend time on more productive tasks that add value to their organizations.

Integrations Enable Customization

Cloud software aims to provide companies with solutions to fix a business or organizational problem. This is why one of the biggest benefits of app integration is the ability to provide an organization with more control over their software and data.

Plug-ins and extensions make software easy to scale as companies grow. By being flexible, integrations can help retain existing customers as those customers expand and add more employees.

Not all software combinations benefit from integrations, but by providing the opportunity and option, apps empower their customers.

[bctt tweet=”Plug-ins and extensions make software easy to scale as companies grow.” username=”@reflektive”]

Silicon Valley Practically Churns Out a New Software Company Every Day

In a world filled with mundane software services, all of these things are important to keep in mind when designing SaaS applications that you want to stand out of the crowd.

DOWNLOAD FREE E-BOOK: The Ultimate Guide to Real-Time Feedback

It’s clear that even in niche markets, companies have a surprising amount of choice when prospecting cloud software options, which is why integrations will become increasingly important as competition thickens in the coming years.

The marketplace for HR software is more than $14 billion, which means you have more choice than ever. But choice presents challenges in determining the best option for your company.

The mandate to select new HR software may come from leadership or observed inefficiencies in the HR team’s workflow. Either way, the choice can be costly and waste valuable resources if not done well.

I have been working with companies in the HCM space to evaluate, choose and implement enterprise applications for over 20 years.

With all of the changes in technology, it is surprising that the mistakes I see HR buyers make have not evolved over this time.

Here are the top six mistakes that I feel have adverse impact on evaluations.

1. Not Setting the Objectives of the Solution First

I cannot tell you how many times I have had the following conversation with an HR leader:

Everything from the vendors you evaluate, to the criteria for selection, should be centered around supporting the core objectives or business case for making the change or addition. 

If the objectives are not the guiding principle for every step of the evaluation, there is a high probability of selecting the wrong solution and not ever getting the project approved.

2. Not Getting Pre-Approval For the Project Objective

Getting the right buy-in is especially critical in the HCM space. Like it or not, many operations executives view HR solutions as cost centers — time and money wasters. It is key to get executive support for transformation prior to engaging vendors. This goes beyond budget.

True buy-in is identifying a set of current problems in the business, that if rectified, would have a salient and positive effect on something that the executive team can get behind. Classically, these are profits, market share, or cost reduction.  

In the HCM space,  employee surveys can help add a quantifiable measure (even if a bit squishy). In today’s market, if a company doing the traditional annual performance reviews surveys its knowledge workers, it will find quite low approval ratings for the current process — as low as 20%. 

Companies with newer, more continuous processes can experience approval ratings from employees well over 80%.  These numbers can be translated for executive teams pretty easily into attrition, goal attainment, and productivity which drive profitability and market share.

[bctt tweet=”In the HCM space,  employee surveys can help add a quantifiable measure.” username=”@reflektive”]

3. Blending Democracy With Software Selection

Although it is important to get buy-in from teams on the chosen vendor — a vote will never support the first tenet of software buying, which is having clear objectives for the solution. Pure consensus almost always invites politics and turns the decision into a subjective process, regardless of the vendor’s ability to meet the business objectives.

The best approach I have seen? Companies that assemble a small group of HR, business, and IT members who agree on criteria and a process for the selection.

Pick a quick, short list of vendors who proclaim to meet your business objectives and provide them with a script of what you want to see from them. The script is key. Without a script, vendors will show you what they want to show you without a tie to the business objective. This can create great difficulty comparing offerings from disparate systems.

Once this small group makes the decision, it is important to socialize it with influencers in the business to ensure a smooth rollout. Consensus decisions typically result in extremely long drawn out processes that can lead to the wrong results. Don’t make this mistake!

4. Hiding the Evaluation From IT

Here’s the deal. HR has a tendency to try to “go-it-alone” on what they deem as departmental purchases. I have seen extreme examples where there is an active effort to hide the evaluation from IT.

The truth is, most of these processes end up going nowhere. When a project goes from evaluation to procurement, there will almost always be steps that include IT. These range from technology stack specifications to security.

When IT gets brought in late, they come in with a bad attitude. You will get responses like, “We can do that in the core HR system” or “We have already licensed an application that does this” — which can end up blocking your project. Regardless of the truth of statements like this, it almost always throws the evaluation back to the beginning where HR is forced to evaluate existing systems.

[bctt tweet=”When IT gets brought in late, they come in with a bad attitude.” username=”@reflektive”]

If you have clear objectives for the project (#1 above) that existing systems are not accomplishing, this can be a very easy conversation and IT can be helpful in weeding through vendors that will best achieve the objectives.

Net net: Rely on — don’t avoid — your IT experts.

5. Creating a “Frankenware” RFP

Looking at RFPs as a vendor can be humorous. There are times when it is obvious that the selection team surveyed a market of 10 vendors and picked the best features from each one. The resulting RFP is a Frankenstein version of the market that no vendor supports.

The result is typically a very polarized selection team around the features that either resonated with them, or that best fit their day-to-day activities, with little focus on the overarching objectives of the project.

There will always be some of this in every evaluation. Almost all of these pitfalls can be avoided by a stringent focus on prioritized objectives for the project. Then, simply put the vendors through paces that exhibit their value to this objective.

6. Secretive vs. Collaborative Relationships With Vendors

There is a wide spectrum of evaluation styles of vendors, from militaristically closed and secretive, to outright collaboration.

Once you narrow down to a short list of two or three vendors who appear to be able to help you meet your business objectives, I would argue that collaborative is better than secretive.

Let’s say you have three vendors do a scripted demonstration focused on the things that get you to your objective. You have your team keep a scorecard on those things that are important to you. There are a couple ways this can play out.

A secretive evaluation style would be pushing the vendors through a closed bid process without letting them know how you viewed their solution. A collaborative evaluation style would be sharing the scorecard with vendors to ensure that you got it right.

Over the years I have seen many examples when we did not communicate well or skipped something that we actually do very well when key information was not shared. If the ultimate goal is to get the best solution for your business for the best price, then start with an accurate assessment. Follow that by sharing guidance on things such as pricing.

No one is served well by a closed bid process – the vendor that is most desperate or the lowest-end vendor will always be lowest price. Is this the partner you ultimately want?

[bctt tweet=”No one is served well by a closed bid process.” username=”@reflektive”]

Summary

If a solution evaluation is focused around the “What” – what we are trying to accomplish rather than the “How” – how does the solution get there, it is much easier to weed through vendor messaging and demonstrations. Applying how well the “How” a vendor  shows you will aid your organization in achieving the objective.

Decision by committee and subjective insights don’t do this. Only a structured evaluation with prioritized criteria — all of which support one or more key, approved objectives for the project — will result reliably with the right decision.

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