What is the best-of-breed approach to HR software?

We explain what ‘best-of-breed’ means when it comes to HR systems, and the pros and cons of this approach to software

Advances in technology inevitably – and unfortunately – bring with them baffling new jargon, which can be hard to decipher. Two of the hottest phrases in the HR software market at the moment are ‘best-of-breed HR software’ or ‘the best-of-breed approach to software’. But what do vendors really mean when they say that? And what are the benefits – and disadvantages – of working in this way?

What is best-of-breed software?

Although this phrase is just starting to creep into usage in relation to HR systems, it’s a common term that IT, procurement and finance professionals have probably already come across.

PCmag offers a clear, easy-to-understand explanation:

“The best product of its type. Organizations often purchase software from different vendors in order to obtain the best-of-breed for each application area; for example, a human resources package from one vendor and an accounting package from another. While ERP vendors provide a wealth of applications for the enterprise and tout their integrated system or HR self-service as the superior solution, every module may not be best-of-breed. It is difficult to excel in every niche.”

So, simply put, taking the best-of-breed approach for an HR transformation project means choosing the best possible human resource management software to meet the specific, distinct needs of different teams or challenges. If you’re applying this approach in an HR context, this means you’ll probably purchase your central HR system from one main vendor – and possibly a couple of bolt-on modules, too – and then specialist systems such as payroll, recruitment, learning, engagement, and time and attendance from other vendors who have deep expertise in these areas.

Taking the best-of-breed approach means you are in control of choosing the ‘best’ software for your individual organisation, so you need to be really clear about your requirements before assessing the market and selecting your chosen provider.

What are the advantages of the best-of-breed approach to HR software?

• Individual departments’ needs are more likely to be met because you have the flexibility to choose specialist software, rather than a ‘one-size-fits-all’ solution that may not do everything you need it to
• Because individual software development companies often deploy new advances in technology – such as machine learning and artificial intelligence (AI) – more rapidly than large HCM vendors, you’ll likely end up with a more sophisticated set of tools than if you procure all your software from a single supplier
• You are free to choose the best technologies that meet your needs at that time – if your needs change, you aren’t tied into a single HCM suite provider, and can remove or replace software in your HR tech stack as requirements evolve
• You can react to changes in your requirements, your budgets, or the technology available on the market more quickly – you can swap out one piece of software for another without causing widespread disruption
• There’s less risk associated with changing vendors or products
• Upgrades to one system won’t affect your other systems, so the risk of any potential problems is minimised
• It’s easier to take a phased approach to systems selection and implementation when working with different vendors
• There’ll be greater user adoption and a better experience for your staff, because you’ll have been able to implement the tools that best fit with their requirements
• You have the flexibility to purchase systems that satisfy country or region-specific needs
• Overall, a suite of best-of-breed software is likely to be cheaper than procuring an HCM suite through a single vendor, because there’s more market competition. You also won’t end up paying for modules you don’t actually need

What are the disadvantages of the best-of-breed approach to HR software?

• Systems must be integrated properly to function at their best: look for systems that are connected via API, or else you might have to manually transfer and update data between systems
• You will need a clear picture of your systems architecture before adding on each additional system: which application do you regard as the ‘source of truth’ for all your people data, and how does data flow from and to each connected system?
• The selection process can take longer as you will need to meet multiple vendors (partner recommendations can help speed up this process – see below)
• You’ll need to do thorough research into the products that could potentially solve the various organisational challenges you are facing, or you risk selecting the wrong products
• You will be liaising with multiple vendors and may have multiple contracts and service desks to deal with
• Training for system administrators and end users may be more complex
• The user interfaces in each system will vary, so the user experience will not be seamless

How to make the most out of best of breed HR software

1. The best-of-breed approach will only succeed if the systems you implement are connected, so data is always accurate and up to date. Look for vendors and products that have proven integrations, or are in the process of integrating their systems
2. Choose vendors with a close, strategic relationship: their teams and products will be used to working well together, and they’ll have been through the joint implementation process before. Ask if they have plans for joint development work in the future
3. Ask for recommendations to speed up your decision process, and help you make sure that you’re getting a group of systems that really make your needs. A good HR software company should be confident recommending its partners, and putting you in touch with customers who already use the same or a similar network of systems
4. If your switching from an all-in-one system to a best-of-breed matrix of systems, be prepared for organisation-wide disruption. You’ll need plans in place to help staff gradually transition from one system to the new, integrated software. A robust communications strategy will be essential to your success
5. Be sure to analyse and refine your processes alongside implementing new technology. Failing to do so will just make your bad processes slightly more efficient, rather than solve your problems

Ciphr works closely with a number of strategic partners to make it simple and easy for its customers to select and implement best-of-breed HR software. Call us on 01628 814242 to find out more

Further reading: Top tips for finding the best HR software for SMEs