Are you currently in the market to implement a new HR cloud technology solution, or are you evaluating your current HR technology stack for potential updates and can't decide between a point solution vs. platform solution? In evaluating new tools, do you find yourself overwhelmed and on the fence about choosing between the two options? You’re not alone! The HR technology market is inundated with a variety of solutions, and it can be hard to determine what vendor(s) to select with so many choices available.
We understand the dilemma and have worked with clients just like you who are looking to solve immediate problems while also considering long term needs. To date, we’ve helped over 150 companies implement HR Tech solutions with various business goals and strategies. In this blog, we'll provide some background on what point and platform solutions can offer, the advantages/disadvantages of each, and things to consider when making your decision.
Before we compare solutions, let’s define both terms to ensure we are speaking the same language. A point solution is a vendor/software typically capable of solving a single, specific problem while a platform offers a robust foundation that can address several problems and create a unified process across your entire employee lifecycle. The selection you make can be determined by various factors: current challenges, budget, internal resources, timeline, overall technology strategy, etc.
Let’s dig deeper to determine which solution is best for your organization.
Point Solutions
The allure of a point solution is it can often solve your problem with best-in class features and user experience. This is one reason why many organizations adopt point solutions. When a software vendor has a specific focus and can invest time and resources solving for one main issue, the product is sure to excel in its class. However, since point solutions are built to have a singular focus, you may need to seek an additional solution/vendor for other problems because the current provider is not capable of handling anything outside of your initial scope. This strategy can lead to a wide use of disparate systems that individually do a great job in their respective area but are not capable of integrating with each other. We have seen this create challenges with simple administrative things like users having different usernames and passwords to access various systems, but even greater than that, users end up entering the same data in multiple places, and when it comes to analytics it is near impossible to get useable, accurate, and actionable data.
We can agree that most users don’t enjoy having to enter the same data multiple times, and from what we’ve experienced, the willingness of users to speak up is partly because they want to be doing work that is challenging and impactful, not repetitive due to systems that don’t integrate with each other.
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Advantages of a Point Solution
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Disadvantages of a Point Solution
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- Best-of-breed for a specific HR process
- Deep functionality for one area
- Speed and cost of implementation
- Maintenance of one solution vs. many
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- Having to manage multiple systems and multiple vendors
- The administrative knowledge required to maintain each system
- Lack of integration between multiple systems and/or cost of integrating the systems
- No 360-degree view employee with data in multiple systems
- Total Cost of Ownership (TCO) may be higher due to different vendor costs
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Point Solutions
While point solutions can be attractive, platform solutions offer many great benefits for the right organization. A platform is typically scalable, meaning you can start small and focus on your most critical business processes for a quick win, and then continue to adopt the solution as your business needs change/grow. In some scenarios, we’ve seen businesses leverage a “big bang” approach and implement everything at the same time. Ultimately, it’s up to the business how to consume the platform, and either method can be successful.
One of the biggest benefits with a platform solution is that data can be entered once and used in a variety of ways across the system due to its integration across HR processes. This means your users spend less time entering the same data and more time doing the work you need them to do. And because the same data can be used throughout the platform, your reporting and analytics are not only more robust, but they are also more reliable and actionable. You in essence, now have one source of truth instead of data from multiple systems, giving organizational leaders more confidence in the accuracy of their reports.
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Advantages of a Platform Solution
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Disadvantages of a Platform Solution
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Integrated end-to-end HR processes
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360-degree view of employee and comprehensive reporting
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Single technology partner for all troubleshooting and maintenance issues
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Fewer integrations, potential lower implementation and maintenance fees
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May be larger investment upfront
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May not have all the best-of-breed functionality found in point solutions
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May not be as “pretty” or user-friendly
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The organization is dependent on one technology partner
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Long-term commitment
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Making the Decision Between Point vs. Platform
Time Factor
If your business needs to solve a very specific problem as soon as possible, you may be better off implementing a point solution to address that specific need. The time to value may be shorter, but we caution you to consider any integration and maintenance costs when evaluating vendors. These costs can add up quickly and may not be included in an out-of-the-box solution.
Budget Factor
It is important to take stock of who owns the budget and key stakeholders involved in the decision-making process. We’ve seen HR processes be siloed within a department and each be responsible for their own technology platform decisions. For example, the Learning department may be planning a technology purchase, without anyone else’s knowledge, but the rest of the HR business unit already leverages a technology vendor that may offer Learning capabilities. It’s important to discuss the requirements to see if a single vendor can be leveraged as it could potentially provide cost savings.
Strategy Factor
When making the decision on a platform vs. point solution approach, consider your overall strategy. Where do you need to be in the next 3-5 years? Will your current technology stack get you there, or will HR, IT and executive management to the table to have this discussion and determine what your future goals are and the best way to achieve them.
Taking the Next Steps in Your Digital HR Transformation Journey
Businesses are doubling down on HR technology to provide the ultimate employee experience. The following are some table stakes for a modern employee experience. Whether you achieve it through a platform approach, or through single point solutions, is a decision that every business must face.
- Employee self service
- Modern technology + mobile features
- Personalized and/or on-demand learning experiences
- Continuous feedback
- Coaching and mentorship
If you are an HR leader looking to streamline and automate your performance reviews and provide real-time feedback to keep your employees engaged, it may make sense to evaluate a point solution. On one hand, it would meet your immediate needs. On the other hand, would it also meet your future needs? Providing real-time feedback is just a starting point; what about rewarding those high performers and identifying them as future leaders to further develop? We challenge our prospects and clients to think long term when making investments in HR technology. Does the vendor offer solutions for any other HR processes should you have a future need, or would you need to go outside of this solution? Do you want to manage a single, integrated solution for HR, or are you okay managing multiple vendor contracts and systems? Again, we’ve assisted organizations in both scenarios and seen successful outcomes. You must weigh the advantages and disadvantages and determine what will meet your business goals and ultimately allow you to provide the best experience for the employees at your organization.
If you're still on the fence about which solution is best for you, we'd be happy to discuss your business needs and help you weigh the pros and cons of each solution to determine a go-forward strategy. Contact us today to for a complimentary consultation with an HR technology expert.
