4 reasons HR technology projects fail; how to succeed instead

HR technology solutions often promise the moon, but the reality is that many HR tech projects are likely to crash to Earth. The numbers don’t lie: An estimated 42% of HR tech projects fail after two years, according to industry experts.

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But as Steve Brink, president and CEO of digital rewards solution provider uFlexReward, told his audience during a recent HRE webinar, “Mending the Shattered Promises of HR Technology,” these project failures don’t have to happen. 

HR technology implementations don’t succeed for four reasons, Brink said.

  1. The overall digitization strategy often lacks a comprehensive or holistic view of the problems to be addressed, meaning the process can become reactive instead of forward-thinking. 

Related: Learn more at HR Tech 2022 in Las Vegas. Registration is open

“A goal without a plan is just a dream,” he said. 

2. The vendors demonstrating the HR technology highlight what makes their solution different from their competitors’ tech when they need to focus instead on the organization’s goals and expectations.

“This leaves out the details that HR really needs,” said Brink. “We need a more detailed vendor process.” 

3. Tradeoffs are made during implementation after HR and IT discover what the vendor’s solution cannot accomplish. Although portions of the project can still succeed, Brink said that at this point HR and IT leaders need to focus on the project’s high-priority goals. 

“With the tradeoffs, you still want to reach your ultimate objective,” he said.

4. Vendors may not be ready yet with their technology and competing priorities among HR and IT and the vendor could hurt on the project. 

“This is why we have shattered promises,” he said.

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HR tech challenges are rife in today’s organizations. According to a poll conducted by PwC, 39% of HR leaders identified data analytics projects and recruiting efforts as their organizations’ leading HR technology challenges and 36% cited cloud modernization of HR systems as challenging. More than a quarter—28%—reported that learning development and upskilling were a top challenge while talent retention earned 27% of the survey votes. 

In a poll conducted by Brink at the start of his webinar, an estimated 10% of audience members said that their HR systems were “a mess” and only about 50% said their current technology was meeting their goals.

Related: How Colgate, NCI and Panasonic found insights hidden in their HR data

That said, HR leaders and their IT counterparts can take steps to avoid project failure, Brink said.

For starters, technology vendors must realize that different companies have different priorities and that can have an impact on HR project outcomes. “They have their own cultures, so [HR leaders should] focus on what is important to them,” advised Brink.

Communication during the project is key and can play a role in managing expectations. “If people are thinking [an HR technology project] will solve every problem and issue, you will not have very happy people,” he said. “HR and IT leaders must communicate what the project is and what it is not.”

He added that having a broad perspective on the projects and their potential impact is important.

“Think about the employee first and the technology second,” he said. 

“So long as you take a long-term view and be patient and communicate where you are going and how you are going to do this and what the vision is, people are much more accepting,” said Brink. “They can see it.”

To watch the full webinar, click here.

Phil Albinus
Phil Albinus is the former HR Tech Editor for HRE. He has been covering personal and business technology for 25 years and has served as editor and executive editor for a number of financial services, trading technology and employee benefits titles. He is a graduate of SUNY New Paltz and lives in the Hudson Valley with his audiologist wife and three adult children.