ERP Vendors: The 800-Pound Gorillas

Sep 9, 2002

You were recently hired as the director of staffing for a major corporation. One of the main reasons you accepted the position was because you would be leading the initiative to select and implement a new recruiting technology platform. You form an internal team to define requirements, canvass the market, and come up with a short list of half of a dozen vendors. With the assistance of the procurement department you develop a 50-page RFP and are ready to distribute it ó when you get the call. It’s your boss. He tells you the project is cancelled, because your ERP vendor just demonstrated its latest applicant tracking module to the CIO. The solution won’t cost anything…because you already own it! The e-recruiting market exploded in the last five years, and it is expected to grow by billions of dollars in the coming years. From the beginning, this market was dominated by a few niche suppliers ó the applicant tracking software vendors. With the evolution of the Internet the market proliferated, and where there used to be very few vendors, there are now very many, including a wide variety of products and services ranging from job boards to online assessments to background checks. There are currently well over 100 applicant tracking systems available in the market, and about eight to twelve that are competing for the Fortune 500 accounts. They each have something unique to offer. Vendor Selection 101 tells us that success can only come from a detailed comparison of business requirements to system functionality. But now that the ERP vendors (such as PeopleSoft, Oracle, and SAP) are beginning to offer e-recruiting products and services, the situation described above is becoming more commonplace. The rationale for this autocratic decision-making usually includes the fact that a huge investment has already been made with the ERP vendor and that the applicant tracking module is already integrated with the HRMS. The internal pressure from the IT organization can be so intense that many HR professionals have no choice but to go along with the decision site unseen. While this might make your life easier in the short term, the long term impact could easily dismantle your staffing team. So what should you do when you find yourself up against the 800-pound-gorilla ERP vendors? Here are a few suggestions on how you can weather the storm:

  • Avoid an emotional response. The natural tendency is to get red in the face and scream NO WAY! ó and then begin to list all the reasons the ERP solution will fail. After all, you have a lot invested in this, and now someone is throwing a wrench in your plans. But it is very important to take the emotion out of your response. This is and always will be a business decision, and you had better treat it that way if you want to gain the respect of the organization, particularly the CIO. You also need to be careful of how you position your objections. If you protest that the ERP solution will never work, you will come across as biased, because you have just begun your RFP process and you are already casting judgment. The more valid objection here is the fact that circumventing the process and making a business decision without gathering and analyzing all of the facts is a bad idea. You can say, “The CIO has raised some valid business reasons to include the ERP solution in the selection process, and we plan to include them. However, no decision can be made until we have completed our objective analysis.” It’s hard to make this argument when you’re red in the face. The fact of the matter is, you need to be truly open to the idea that the ERP solution may in fact meet your overall needs the best. But the only way to find that out is to complete the process.
  • Weighted requirements. I often preach about the necessity of well-defined and prioritized requirements for vendor selections. Here is a situation where you will need them most. There is no solution available that will meet all of your requirements, and there never will be. You may have heard the argument phrased like this: “If the ERP solution meets 80% of the functionality we need, then it should be a no-brainer.” Without defining weighted and prioritized requirements upfront, you will not know if the 20% that’s missing happens to be the most important to you. You might know in your gut, but without facts and data you will have a hard time convincing anyone. With this type of document in your arsenal, when faced with the internal pressure you can simply refer to the fact that integration with the HRMS and the cost implications are all weighted factors in your analysis.
  • Gap analysis. Regardless of the circumstances, if it is a forgone conclusion or the decision was already made ó or it is your only option because the CFO has put a moratorium on any new capital expenditures for systems ó you will need to make the most of it. It is also possible that, based on the review of the vendors against your business requirements, the ERP solution is the right fit. No matter what the final selection is, it is always important to conduct a gap analysis before implementation. You need to look at each of your requirements, particularly those that ranked very important, and determine where the solution falls short (remember no solution will meet them all). Based on that information you can determine potential impact, identify workarounds, or develop and integrate functionality to bridge the gaps. This way you will know going in where the challenges will be from a user perspective and you will be able to mitigate the risk and increase the probability of user acceptance and success.
  • The importance of process. A vendor selection project is more than simply comparing functionality against requirements and negotiating a contract. When executed correctly, it is a process that engages representatives from different departments of a company, brings them together to define common goals and objectives, allows each of them to understand and appreciate each other’s needs as well as the greater needs of the company, and sets the foundation for managing the change that will take place during implementation. If you circumvent the process, no matter how good the vendor, no matter how many requirements are met, no matter how many bells and whistles, the project will most likely be perceived as just another decision that was made in the ivory tower without any input from the most important people, the recruiters, the people who will use the system (or should we say won’t use the system).

While these suggestions might help you get through the twists and turns of the corporate politics, there is one factor that underlies them all. When it comes to making the selection of a new recruiting technology platform successful, HR and IT need to figure out how to get along and work together as a team. The 800-pound gorilla isn’t going anywhere, but it doesn’t have to squash your selection process if you can work with the right people in the right way.

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