The most common reasons for HRMS implementation failure

Nobody plans to fail but somehow it still happens. To put a number on it, a 2015 report from the Standish Group found that more than 70% of IT project implementations ended in failure. If you’re facing the prospect of an HRMS implementation, that’s a daunting figure.

What does “failure” mean? Broadly speaking, HRMS implementation failure falls into one of two categories: users aren’t using the system, or the system is not fit for purpose. Either means your HRMS is an imminent bad investment in need of rescue. But before you plan your recovery strategy, you need to know why the project failed. Here are six of the most likely reasons for HRMS implementation failure…

1. Failure to plan the project adequately

As any project manager knows, planning is the key to success. It’s also often complicated: engaging with the full range of stakeholders, gathering (and reconciling) different user requirements, researching systems and vendors, managing the project team, a communication strategy that both informs about and ‘sells’ the system and its benefits, change management, data cleansing and migration, project governance and keeping the C-level sponsor sweet, budgeting, training, go-live, post-go-live support… Tasks and their dependencies must be mapped out, responsibilities allocated and monitored and all within an inevitably too-short timescale.

Check out this complete guide to planning an HRMS implementation including management tips and more

2. Unclear requirements gathering

User requirements are varied and the first step is to identify your stakeholders. Different roles and responsibilities will necessarily have different expectations of the incoming HRMS and failing to discover these expectations is a recipe for project disaster when you’re left with an underused and over-criticized system.

As a starter, your likely stakeholder groups include:

  • C-suite executives looking for strategic impact.
  • Specialist functions (such as finance and accounting, procurement) concerned with how the system will or won’t impact their roles.
  • HR, obviously.
  • Employees as a whole who, at the least, will have their personal information stored on the system. Though it’s more likely that the system data will amount to a virtual career history of their time with the company.

Failure to consult these groups and then maintain communication and dialog (even if only regular project updates) leaves them disengaged with the process of purchasing and implementing the new HRMS. The likely outcome is a poor adoption rate because people won’t see the system as adding any value to their working lives.

3. Choosing the wrong system

This is likely to be the result of failing to engage with stakeholders and their requirements. While the system might still be salvageable, skimping on the requirements leaves you with a system not fit for purpose. The same can result from a failure to match the system to your selection criteria, perhaps the vendor’s demo was impressive enough to hide a critical flaw or shortfall. Perhaps the company’s priorities changed unexpectedly. All that’s left is to go back to the contract and the vendor and look for opportunities to customize, alter or exchange the purchased system (assuming the contract can’t be canceled).

In fact, it’s even possible that you didn’t need a new HRMS at all. Maybe the previous system could have been upgraded or enhanced with less disruption and at less cost.

4. Poor budget management

Money, money, money. There’s no question that implementing your HRMS over-budget is a form of project failure. Whether it’s unanticipated costs (see “Failure to plan” above), externally-directed changes in project scope or schedule, or spiralling needs for external consultancy, it’s worryingly easy to blow the budget.

Use our free HRMS cost and budget guide to plan your HR software spend accurately

When it comes to not overspending, be sure to only purchase system features and functionality that you have definite plans to use, don’t buy features that you already have in-house, and don’t listen to the vendor’s sales talk, instead parse what they’re actually telling you about the system and their services.

5. ‘Dirty’ data

Or to put it another way, not taking the opportunity to cleanse your HR data before transferring it to the new HRMS. Ask yourself to what degree you can guarantee the accuracy of the data held in your legacy systems. And then ask yourself how easy-going your people are – do they mind if you make mistakes with their paperwork, their payslips?

Implementation is an opportunity to check, cleanse and update your HR data, thus giving the new system the very best chance of impressing its users. A common strategy is to include a data cleansing exercise in your communications strategy, asking each user to review and update their own personal data. Then, rigorous parallel testing of the new and old systems side by side should give you an idea of whether the new HRMS is likely to deliver the improvements you’re hoping for.

6. Lack of staff training

Another key success factor in HRMS implementation, especially for user adoption, is your training program. Often low usage rates are due to people not realizing that new features are available or not knowing how to use them; alternatively, they may simply be clinging to the old way of conducting HR transactions, all of which are potentially training issues.

That said, the problem may not be a lack of training but the wrong training. Tempting as it might be (at least in budget and simplicity terms) to ‘sheep-dip’ everybody in the same training package, it’s worth doing some training needs analysis linked to roles and responsibilities as part of your stakeholder engagement and requirements gathering. It may be that you offer a different training package to each major stakeholder group, tailored to their specific needs.

Equally, the content of the training might be fine but the delivery method not so much. Comparatively budget-friendly though e-learning might be, some users (depending on role and/or experience and skills) may need a more face-to-face approach (or bite-sized online modules, or a user manual, or an expert coach, etc.) to more comprehensively grasp how to benefit from your new HRMS.

Check out this full guide to planning your HRMS implementation to make sure your project doesn't end in failure

Project failure is all too common in IT circles and HRMS implementation is no exception. The key is, of course, to consider the above factors before you get to the point of failure – to use all the available knowledge and experience to run a project that addresses concerns, engages stakeholders and results in an HRMS that is not only a functional improvement but is also widely used.

author image
Dave Foxall

About the author…

Dave has worked as HR Manager for the Ministry of Justice for a number of years, he now writes on a broad range of topics including jazz music, and, of course, the HRMS software market.

author image
Dave Foxall

Featured white papers

Related articles