How to choose the best HR software for SaaS/tech startup

How to choose the best HR software for SaaS/tech startup

Our journey of looking for the best HR system to cover our needs as a small SaaS remote business. This practical guide includes detailed steps and will help you to make the right decision.

How to choose the best HR software for SaaS/tech startup

A good HR information system is like a core hub that helps you orchestrate your employee agenda from one place, and choosing the right one can save you countless hours of work. But because onboarding your entire team to a new platform takes a lot of energy, as a People Ops person, you probably want to put your colleagues through the transition only once. I’ve done it four times to date (in different companies, I should say), so I’ve decided to make a list of practical tips you can learn from to nail it on your first try.

Step #1: See what’s out there

First you want to dive into a bit of initial research. If just reading the word “research” gives you goosebumps, I’ve got you – feel free to go easy on yourself and try prompting ChatGPT or another AI generator like this:

“Give me an overview of 10 HRIS tools available in Europe, taking into account that the target client is an IT company of 100 people working remotely, in asynchronous mode. Highlight their pros, cons, and pricing. Order them from the one that has the most positive customer reviews online.”

Pricing of various HR management tools by ChatGPT
Pricing of various HR management tools by ChatGPT

This will outline a general idea of what you need to look for in an HRIS and how to set your budget, which you can then take back to your CEO or CFO. You’ll find that with most HRIS, pricing depends on the number of users, so keep that in mind if you’re planning to scale up your company dramatically in the near future.

The next handy thing to do is to ask your fellow HR friends for tips. They might mention a tool that’s already on your list and make you either move it higher, or dump it altogether because it’s not going to do what you need.

Step #2: Align expectations with team leads

Now it’s time to invite other stakeholders to the table. And by stakeholders, I mean team leads and other managers who might have their own ideas and pet peeves about tools already in use. 

You might want to ask them what agenda they handle manually on the side, and what features would make their lives easier – to give an example, one of the most important parts of any HR agenda is managing people’s leaves and holidays. And our specific context is that we’re a software agency with people on various client projects, so we didn’t just need a module that would track people’s time off, but also give us the flexibility to appoint different people to approve requests.

Collect people’s ideas in one place online, e.g., a shared Notion document. This will allow for an easy back-and-forth, and you’ll see how fast the shape of your ideal new HRIS will start emerging from this collaborative wish list.

Step #3: Make a comparison table of HRIS features

Again, you can skip staring at a blank page – ask your trusty AI to inspire you with a list of useful HRIS features specific to your company’s field, or just go with this one right here.

An actual screenshot from our HR platform feature comparison table
An actual screenshot from our HR platform feature comparison table

Let’s see. Does your prospective HRIS offer…

  1. A recruitment module to support your hiring? Can it collect applications from your website, parse CVs and let you tag hiring managers on candidate cards?
  2. Easy management of the employees’ entire life cycle, from onboarding and career planning to offboarding and exit interviews?
  3. Payroll processing, including the option to adjust pay on a monthly basis? Can employees download pay stubs and tax documents?
  4. Tracking time worked and project allocation? Can employees request time off and cancel scheduled holidays and sick days? Does it account for foreign bank holidays?
  5. A user-friendly interface? Can people easily update their personal information and access company policies and resources?
  6. Online team-building activities and employee feedback mechanisms?
  7. Integration with collab tools – Slack, Microsoft Teams, the Google suite or project management tools like Trello, Asana or ClickUp?
  8. Last but not least – secure remote access, multi-factor authentication (MFA)?

Of course, you might not be looking to tick all these boxes. Maybe you already have other people-ops tools in place – payroll and accounting software, or an applicant tracking system (ATS). In that case, you can either look for a more light-weight HRIS that will also be cheaper, or consider moving that part of your agenda to the new platform, if it promises handy features.

Step #4: Get demos and trial periods

Once you’ve shortlisted all eligible HRIS, see if they offer demo calls and trial periods. Take your checklist with you and go through your requirements during the call with the sales people. 

This step takes the most time, but it’s worth it, trust me. Don’t forget to update your notes in the shared document as you go, so that everyone’s on the same page.

A screenshot from the PeopleForce software showing the employee detail
A screenshot from the PeopleForce software showing the employee detail

After the calls, narrow your selection down to 2–3 tools that fit the bill. Ask for a trial period of 2–4 weeks at least to be able to see important features in action, like the leave management module I mentioned earlier. Invite a handful of colleagues to try using the HRIS and report back with their honest user experiences. Ask them to focus on how well it’s localized, whether they had trouble finding anything, and if its Slack integration does everything they expect. Pro tip, nitpicky colleagues make for the best testers. 🙂

Step #5: Kick off your subscription

Once you’ve settled on the winner, congrats! Start with a monthly subscription, and if you’re still happy with the HRIS three months down the line, you can switch to annual payments, which usually means a lower price per month. Don’t be shy to ask for a discount, reasonable sales reps will definitely try to meet you halfway. At this point, you’re already a paying customer and it’s their job to make you happy.

And you’re off to a successful start. The part that’s next is even more fun – introducing your new HRIS to your colleagues. A lot can go wrong there, too. Stay tuned for my notes on that.

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Monika Jemelikova

Monika is responsible for all HR & People related activities inside Digismoothie. She is keen on exploring new trends of work and believes in the power of technology. Lately, she has focused on building culture in a remote/async environment.
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