Very few organizations would build an ERP in-house or build an operating system in-house. When it comes to a HRIS/ HRMS/ HR Portals, its worth examining if this is also true, given the fact that a HRMS/ HRIS is often as complex as an ERP. Let us consider three situations and apply the question to them.

  • Organization with Standardized HR processes
  • Organization with very unique HR processes
  • Unable to find good local HRIS vendors

A.Organization with Standardized HR processes.

In this case, the answer, in our opinion, is a slam dunk – buy, don’t build. The arguments are the same as to why one would not build an ERP or an operating system in-house becomes applicable.

  • It is too complex, takes too long, and takes too much effort. You will need a large team and a few years at the least to get it done
  • It needs to be built for change. Your processes, organization structure and rules may change. In-house applications usually do not flex, but good products do change
  • Best practices – Good products evaluate best practices in HR processes like appraisals and leave and incorporate it while in-house development may not
  • Statutory needs – Good products are designed to handle changing statutory needs. Rarely are in-house applications designed to handle these changing needs
  • Technology Utilities – Good products provide numerous technical utilities like View providers, alerts, mail triggers, performance indicators and other reporting mechanisms which in-house developers don’t have access to.
  • Developing in-house is fraught with risk. It is very difficult to keep a high performance software development team in place for a project that is re-inventing the wheel. If core team members leave, the project can be in jeopardy
  • Will it scale? Good products are designed to scale as volumes grow. In-house products often by pass this capability
  • Maintenance and enhancements over the life time – Maintaining large applications is very costly. Bought out products have the advantage since the maintenance is being shared by many companies. Bought out products also improve with time as their customer base grows and their need to grow is defined by improved capabilities
  • Cloud readiness – The cloud is the future and even security conscious organization will move the cloud after certain safeguards. Product organizations are more experienced to build large products for the cloud.

KServeHRMS is one product which caters to all these expectations of good bought out products.

Organizations with Unique HR processes

It is worth looking at which processes are unique in these organizations. Often, the back bone areas of HR like Employee Database, Life Cycle Management, Leave, Payroll, Performance Assessment and Employee self service don’t change, but a few unique processes, screens or reports change. A good product will have 300 to 500 screens covering all the core areas, and also have tools to extend the product to cater to these unique processes. It is very important that when you extend the product, the products core architecture does not get modified, because that will stop you from getting upgrades from your provider. If the relative percentage of unique processes are low, and your product vendor can extend the product without reneging on the promise to provide upgrades, then it is worth going through the buy route. is capable of extending the product with relatively lower effort, without reneging on its promise of upgrading the product

There aren’t good products in your geographic area

This was a valid reason to build in-house earlier for this situation in the past. However the Cloud changes this because you can now access a product from anywhere with just a browser based device. High quality support is also provided quickly using internet screen and video sharing tools, making the geography issue irrelevant now

To summarize, in almost all situations HRMS/ HRIS is an area where build does not make sense any more. Will be nice to hear from anyone who thinks otherwise and why.