How To Build a Business Case For HR Software [Free Calculator]

HR software is a great investment for any company. No matter the size or industry of your organization, having on-demand access to accurate information about your employees is essential. But the decision to invest in HR software (aka an HRIS, or human resources information system) requires you to consider many factors, such as your HR department's budget, the return on investment (ROI), and how the software will fit into your company's overall technology plan.

We know that making the decision to invest in HR software can be daunting, but don't worry! GoCo offers a free service designed to help you build a customized business case for HR software that you can share with your company's leadership. We'll help you prove that HR software will help your organization reach its goals, taking into account your current pain points, areas you're looking to gain efficiency, and the size of your company. This analysis is totally risk-free without any obligation or contract.

What Is a Business Case and Why Do I Need One?

A business case is a document that outlines the justification for a proposed project or initiative. In the case of HR software, it should address the needs of your company and how the software will solve those problems. It should also include an ROI analysis to show how the software will benefit your bottom line. Most importantly, you need to show your company's leadership that this investment will allow you to shift your focus to people and culture over administrative tasks. Remember, you didn't get into HR to fill out paperwork all day!

Creating a business case may seem like a lot of work, but it's essential to making sure your software investment is a success. By taking the time to build a strong case, you'll be able to make a convincing argument to the decision-makers in your company and get them on board with your plan.

What Should Be Included In an HR Software Business Case?

There are a few key elements that should be included in your business case for HR software. Here are some of the most important things to consider:

The Needs of Your Company

What problems are you looking to solve with HR software? How will it make your job easier or improve efficiency? Be specific about the benefits you're hoping to achieve, including the automation of:

• Employee onboarding

• Benefits administration

• Payroll

• Time tracking

• HR Compliance

The Cost of the Software

How much will it cost to purchase and implement the software? Be sure to include all one-time and recurring costs, such as licenses, training, and support.

The Return on Investment (ROI)

What are the financial benefits of investing in HR software? How will it save you money or improve your bottom line? Be sure to include hard numbers and financial projections to back up your claims.

The Risks and Challenges

What are the potential risks associated with implementing HR software? What challenges do you anticipate? Be honest about any potential problems and provide solutions for overcoming them.

By including all of these elements in your business case, you'll be able to make a strong argument for investing in HR software. If you're not sure where to start, our free business case builder can help you create a custom case for your company.

How Do I Assemble and Present My Business Case?

The business case for your project should tell the story of how it supports the business. By clearly articulating the connection between your project and the business goals, you will make a strong case for why your project is worth investing in. There are a few best practices for structuring this story in a compelling way, and getting it in front of the right people.

Write an Overview or Executive Summary

A business case overview, or executive summary, is a brief, yet compelling summary of a proposed business initiative. It should highlight the key points of the proposal, and make a strong argument for why the software purchase should be approved. Make it clear and concise, and leave the reader with no doubt as to why your proposal is a great investment.

Call Out the HR Department’s Pain Points

Every business has certain areas where it struggles, and addressing these pain points is often what drives companies to invest in new software. If you're looking for a way to make a strong case for new HR software, you'll need to clearly articulate the HR department’s pain points. Common HR pain points include:

Regulatory Compliance

Small HR departments often struggle to keep accurate records for key regulatory requirements like the ACA, ADA, and all levels of taxes. Businesses need a reliable audit trail showing they have delivered the required information supporting relevant company policies. Otherwise they will be at risk of fines or lawsuits.

Data Security

Reliance on scanned forms, emails, paper copies and ad - hoc processes puts personally identifiable employee data at risk. The information a business collects, including social security numbers and copies of photo id, is a gold mine, and bad actors are well aware that smaller businesses can offer a poorly secured target.

Onboarding

Onboarding new employees is a time-consuming back-and-forth of forms and paperwork. It slows down the hiring process and ultimately hinders growth. Importantly, it also starts the most impressionable team members off on the wrong foot with cumbersome processes and first days spent filling out forms.

Vacation and PTO Tracking

Requesting, recording, and tracking personal time off takes too much time and isn’t always captured correctly. Busy and frustrated employees can resort to the quicker alternative of an email or text to their boss, leaving the “official” requests undone. Making sure all PTO is on payroll, managing comp time for holiday hours, and keeping employee balances straight is nearly impossible for small HR teams.

Benefits Administration

The benefits administration process is time-consuming and relies too heavily on manual work. Paper open enrollment packets are often misplaced, creating delays in enrollment. Paper enrollment forms are a time suck and manually entering the data creates opportunities for errors. The resulting delays are frustrating for employees and pose a risk to their access to healthcare and other benefits.

Reporting Problems

A business’s decision-making is hampered by weak reporting capabilities. Without a system in place, data is inconsistent and hard to interpret. Lag times in capturing information leave HR teams reacting to old information, often having to look at last quarter’s or last year’s data as the most “current”.

Support for Remote Workers

Remote workers often have a challenging time completing basic HR tasks, making it hard to feel like part of the team. Paper forms, hard-to-use interfaces, and lag times as the HR team digs through files don’t leave remote workers feeling supported.

Once these pain points are understood by company leadership, you'll be in a much better position to suggest a solution.

Explaining the Solution and its Business Impacts

With your pain points carefully laid out, you’re ready to propose a solution. You’ll need to provide a thorough but succinct introduction to the system you’ve evaluated. Provide a point-by-point analysis of how the system addresses each of your HR department’s challenges.

Your leadership may have questions about risks, challenges, and limitations associated with the new software. Make sure you’re ready to respond to concerns about:

• Employee data security when transitioning to the new software

• Expected challenges of training employees on how to use the software

• Risks of incompatibility with the business's related software and systems

Quantify the Return on Investment

This is arguably the most important section of your business case. Leadership teams always want to know how a decision will affect the business’s bottom line, so you’ll want to spend some extra time on this information.

Taking into account the costs and ROI calculations you previously gathered, tell the story of how an investment in HR software will help your company reach its goals faster and more efficiently. Make sure to include predictions about:

• Improvements to employee retention

• Reduction in HR admin overhead tasks

• Time saved by the HR department for each new hire

• Employee time saved per year, across all HR tasks

Leadership will undoubtedly ask how you came to these conclusions, so make sure to cite reputable sources in your ROI assumptions.

Get Backup from Company Leadership

Once you’ve gathered your main arguments (or you’ve let us do the work for you), you’ll want to find an executive-level sponsor who can help you present your case to company leadership. This sponsor should be someone who can help illustrate the impact of HR efficiency on other departments. You’ll want to find a sponsor who can quickly get your message in front of the right decision-makers.

Let us Build Your Business Case for HR Software!

Building a business case for HR software doesn't have to be difficult. If you're not sure where to start, our free business case builder can help you create a custom case for your company. We'll ask questions about your current pain points, efficiency needs, and the size of your company. With this information, we'll be able to generate a tailored business case that you can download and send to key decision-makers in your company's software-buying process.

The process takes a few minutes and only requires you to click on responses to a few quick questions. Once you're finished, you'll have a custom business case that outlines the needs of your company and how HR software will solve those problems. What are you waiting for? Get started today and see how easy it is to build a business case for HR software!