As an advisor, I participate in many lengthy discussions with both customers and vendors – not least during procurement of HR and payroll systems. Customers within HR and payroll areas do not always have the same experience of procuring and implementing systems as those who work with ERP systems. The risk is unnecessary conflicts, misunderstandings, and in the worst case, a dissatisfied customer before the project has even started. Here are some recurring pitfalls – and my advice to avoid them:
1. Dissatisfied customer from the start – is it worth it?
A new HR or payroll system is an investment for many years ahead. Yet projects often start with unclear expectations, lack of consensus, and trust that is immediately undermined. When delivery and expectations do not match from the start, the entire project becomes difficult.
My advice:
- As a customer - Ensure that expectations, scope, and responsibility are clearly defined in the contract before you sign. Investing time here reduces the risk of conflicts later on.
- As a vendor - Act professionally during the procurement and ensure a smooth handover to your consultancy organisation. It is crucial that those who will support the customer in the project have access to the same information and insights the pre-sales team gathered during the procurement.
2. The vendor talks functionality – the customer talks process
The vendor wants to show what the system can do, while the customer wants to understand how processes can be improved. Here, a bridge is needed: translating functionality into business benefit. Failure leads to frustration.
My advice:
- As a customer – prepare with clear, anchored process visions. This strengthens your evaluation and increases the chance of getting a system that actually supports your needs.
- As a vendor – understand how the customer wants to work going forward, not just how they work today.
3. Honesty in RFP responses and system demonstrations
Unfortunately, it is not obvious that the answers in an RFP or what is shown in a demo reflect reality. Functions are promised that actually lie on the roadmap, require customisations, or entail extra costs. The result: a disappointed customer.
My advice:
- As a customer – always ask for references or examples of functioning solutions in the same version of the system you are purchasing. Evaluate carefully and do not underestimate the time you should invest in the evaluation process.
- As a vendor – be transparent. Do not build your business model on selling an unfinished system to then rely on upselling. A realistic “no” is better than an unrealistic “yes”.
4. Statement of Work – the heart of the contract
The Statement of Work (SoW) is the heart of the implementation contract. Yet it is often vague, full of generic formulations, and without clear delimitations. A weak SoW is practically a ticking bomb for both schedule and budget.
My advice:
- As a customer - Demand concreteness. Ask the vendor to specify what is included, what is not included, the assumptions made, and what is expected from you in setting up the new system. Invest time in this – it saves time, money, and trust later.
- As a vendor – Create a clear Statement of Work. Do not just describe functionality, but place it in a process perspective. As mentioned, customers think in processes and otherwise risk missing what is actually purchased and what is required of them. Clarity benefits both parties.
5. Unreasonably short implementation projects
"No problem, we’ll implement in three months!" But without preparations around organisation, data quality, and anchoring, it rarely turns out well. A system introduction is never just technology – it is a major change project and ultimately a transformation of organisation, processes, and ways of working.
My advice:
- As a customer – evaluate your own maturity before accepting the vendor’s schedule. Do you have resources, data quality, and anchoring in place? If not, rather extend the schedule than risk failure.
- As a vendor – be realistic. The system is just an enabler; the benefit comes only when the customer has worked with data, processes, and change management.
6. Project management – an underestimated success factor
All too often, projects are managed carelessly: unclear roles, weak steering group, and lack of follow-up. The result is a domino effect of missed deadlines and conflicts. Weak management is almost always a root cause of problems.
My advice:
- As a customer – appoint a clear steering group, define roles and decision paths, and follow up regularly. This is not administration – it is crucial for success.
- As a vendor – include project management clearly in your contracts. The customer should not have to remind you of this.
7. Price is not decisive
It is easy to get stuck on the price tag, but it is rarely what determines success. Focusing on licence cost and implementation price risks overshadowing more important factors: the quality of collaboration, clarity in commitments, and the customer’s ability to embrace the system.
My advice:
- As a customer – evaluate the whole. Value the vendor's team, their ability to collaborate, and clarity in commitments at least as much as the price.
- As a vendor – follow the advice in this blog; the clearer, more honest, and more attentive you are, the more professional you will be perceived.
Summary
Procurement of HR or payroll systems is the start of a long-term partnership – not a one-off deal. By paying extra attention to clarity, process understanding, and project management, both customers and vendors can create a solid foundation for a successful implementation and long-term realisation of benefits. Are you facing an upcoming procurement? Visit our HR Tech Summit on 11 November in Stockholm! Take part in inspiring presentations and book a free advisory session with our experts.
