December 12, 2023

Your HR Tech stack: the decisions you need to make

Matt Grimshaw

If you're thinking about signing up as a Youda customer, there are some wider decisions about your HR Tech stack that we think you ought to consider...

Decision 1: do you want your HR Tech stack to be based on a traditional, comprehensive HR platform or a collection of best in class applications

This is your big philosophical dilemma and it's a decision that will have very long term consequences for the culture and growth of your business: do you want to buy into a traditional comprehensive HR platform or do you you want to buy lots of best in class HR tech applications?

The advantages of a comprehensive platform:

  1. It's less complicated. There's an undoubted attraction to getting everything in one box. You're dealing with one supplier and you know how much it's going to cost.  You can understand the features you're getting and how it all works.
  2. They do a good job of traditional HR admin. Platforms like Fourth, Harri, Access and Bizimply were designed to alleviate the admin burden on hospitality HR teams. If you just want an HR function that just does the bread and butter of managing payroll, time and attendance and employee records then go with an HR platform and pick the one that enables you to manage costs, operate consistently and ensure you're legally compliant. Why make your life harder than it needs to be!
  3. They give you integrated data. The big advantage of a platform is that you don't have to clean your people data before you analyse it.

The disadvantages of a platform...

  1. Jack of all trades, master of none. You get lots of functionality with an HR platform. To support the development and maintenance costs of providing this breadth of features, traditional HR platforms need to appeal to as broad a market as possible. That means they tend to be designed to meet the needs of the 'average user'. If you're average shaped and average is all you aspire to, that's not a problem. But for lots of hospitality People Teams, buying into a platform is like buying a pair of jeans that fit perfectly on your waist, are ok on your thighs, but finish an inch too short at your ankles. The longer you own the jeans, the less enamoured you are that they fit your waist, and the more preoccupied you become with the frustration that they're a bit too short.
  2. Watch out for the features/bundled pricing trap. The other way platforms increase their commercial return is by adding new features to broaden their appeal. This tends to create two problems for People Teams. First, the more features you bolt on, the more it feels like you're riding a camel not a horse (particularly if they're features you don't need or want). And second, you'll end up having to pay for the next pricing tier in order to get the one bit of functionality you need and 6 others you don't!
  3. They're not very flexible. The functionality of HR platforms has been hard-coded by a development team. If the engineering team is any good, that means the platform will be reliable, but it also means it's inflexible. It doesn't make sense for HR platforms to get their expensive development team to create bespoke functionality that meets the particular needs of an individual client. When Chantal Wilson was People Director at Honest Burgers, she asked her platform provider if they could change one field on their system from "Sales" to "Covers" because she felt it was an important cultural nudge. She was told it was possible, but it would cost £25,000 and she'd need to wait six months... to change one field of data! The more innovative and distinctive you want your people experience to be, the more frustrating you'll find the "computer says no" limitation of a traditional platform.
  4. You get integrated data but not insight. HR platforms will capture the data they need to function (e.g National Insurance number) but not the data you need to create better experiences or to improve performance (e.g. what's the best combination of people to have on a Saturday night if you want to maximise sales). They also tend to be closed systems (you'd be amazed how few of them have a well documented open API), which means it can be difficult to get data out of the system onto a BI tool or to feed data in from other applications.

Questions to ask before buying a platform:

  • Are their existing customers happy? And can you speak to some of their existing customers to check whether they're running their People Operations in the same way you want to?
  • Are their users (i.e. front line employees) happy? For example, if your HR platform comes with a built in communications app, ask if employees actually use it. If you want a benchmark, when Chantal was at Honest, 98% of their people accessed their comms platform at least once a week.
  • Do they have an open API? Who owns the data on their system and how easy is it for you to extract it if you want to?
  • Do they have existing integrations with the other applications you want to use?
  • What's their vision for their platform? What's on their product roadmap?

The advantages of buying best in class HR tech applications

  1. You get better functionality. When HR tech companies are focused on solving one problem really well, they keep innovating and investing in that solution. Take one of our partners: PayCaptain. They want to be the most helpful payroll solution on the planet. They don't want to do rotas, recruitment, learning etc. They want to go deep not broad.
  2. Better UX. Standalone applications tend to have a much better user experience, particularly the UX for front line employees. To be successful as a standalone application, you can't rely on people having to use your system, they need to want to use your app.
  3. More innovative capabilities. Innovative ideas tend to start as discreet, custom built applications (TipJar's a good example). Platforms tend to wait until this innovation is becoming mainstream before they either try to replicate it or acquire the company that developed the original app. So if you want to be ahead of the curve on people experience - you'll need to buy apps. Random example, let's say you want to provide mindfulness/guided mediation for your teams, you're not going to find this on an HR platform.

The disadvantages of buying best in class applications

  1. The experience becomes incoherent. The first three applications you introduce to the business are great. People love them. But three applications aren't going to be enough to deliver all the capability you need to manage your people. So you keep adding more and more applications and before you know it, you're expecting people managers to sign onto 15 - 20 different applications to get their job done. It doesn't matter how good the UX is for each of those individual applications... the overall experience of constantly switching between systems is frustrating and cumbersome.
  2. The applications don't talk to each other. 15 different applications means 15 silos of data and each of those silos will be structured differently. That means you'll either need to pay a developer to connect everything together so it feeds into a BI tool; or you'll need someone to consolidate and clean the data every time you want to do some analysis. Or most likely, you just won't bother! And if you don't bother, it makes it impossible for you to take a systemic perspective on your people experience.


So where does that leave us?!

We think traditional HR platforms are the Nokia 3210 solutions. Old school. Reliable. Drop it down the stairs or flush it down the loo and it'll still work. If you only ever want to do the HR equivalent of making calls, sending texts and playing snake - it's perfect!

Buying standalone HR Tech applications on the other hand, is like having a lot of iPhone apps... but no iPhone that makes them work together!

And that's where Youda fits in...

If you decide to buy (or stick with) a comprehensive HR platform, Youda can sit on top of it and give you the flexibility to create the experience you want for your people - just make sure it has an open API so that you can get the full benefits and ease of experience.

And if you use best in class HR Tech applications, Youda is the glue that connects them, and turns them into a coherent system.

You can think of Youda like the central nervous system for your HR tech stack. We provide the 'brain' - a single source of truth for all your people data; and the 'nerves' - the automations and workflows that run across your applications so you can create seamless, coherent experiences.

If you'd like to learn more, or if you want to get started, book your demo call with me now.

Matt Grimshaw
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