HR software requirements checklist: How to compare HR software vendors

Changing HR systems has a huge impact on every employee, manager, and team, so it’s a decision that needs careful consideration. An HR software evaluation checklist helps you to:

• Score vendors fairly against the same criteria: Compare options against a defined scoring system, instead of opinions.

• Eliminate unsuitable software at an earlier stage: Remove vendors from contention if they don’t meet your requirements, so you can focus on those that do.

• Learn what your true priorities are: Get a clearer idea of what you are (or aren’t) looking for as you evaluate different vendors or types of software.

• Align stakeholders before vendor outreach: Build a business case in favour of your shortlisted option(s) before you complete the final evaluation stage.

Compare each vendor fully with a software requirements checklist that covers key areas like core HR, payroll, integrations, compliance and security, scalability, and more — plus examples of the best questions to ask HR software vendors.

Any human resources information system (HRIS) should include core HR features and functionality, but it’s not always covered in the same depth. Use these questions to help you find a system with the right mix of essentials and flexibility.

Some HR platforms support native payroll, while others offer preliminary payroll and integrations. Decide whether you want a dedicated HR system or combined HR and payroll software, and compare potential vendors based on your existing (or planned) payroll workflow.

Your HRIS is at the centre of your tool stack, but it’s unlikely to be the only software you use — especially in a growing business where performance, compensation, and hiring are part of your role. Check that your would-be HR software integrates with tools you use now and any you plan to use in the future. 

Data security and HR compliance are essential considerations when choosing new software. Ask the legal team for their input as you compare different HR platforms for compliance, security, and risk.

Switching HR software takes time and effort, and it’s a process you don’t want to repeat again in a year or two. Evaluate options to see how they hold up to headcount growth, increased demand, and the need for multi-entity HR software.

New software only works if employees and managers are happy to use it. Use walkthroughs, demos, and trial periods to understand whether the software is easy enough for everyone to use and get value from.

Data migration, implementation, and onboarding takes up a significant part of the software switching process. Compare vendors on how they approach this, how much support is available, what it’ll cost you, and how their service aligns with your needs.

While 88% of organisations are deploying AI, only a handful are integrating it into daily operations. If AI is part of the way you work now and in the future, you need software that embeds AI in HR. Ask vendors how they make the most of technology now and what’s on their roadmap for the next few quarters.

Understanding HR software pricing involves comparing custom quotes, but it’s also essential to ask about hidden costs, service level agreements, contract periods, and fees. Gather all the costs and contract details so you can calculate the total cost of ownership (TCO).

A software requirements checklist or scoring matrix is the foundation, but you need to know how to approach scoring to decide which tools to add to your shortlist. Here’s how to score potential software vendors:

• Decide your scoring system: Choose a scale that makes sense for your organisation — like a 0-5 system, where 0 = doesn’t meet requirements and 5 = the highest score.

• Build an evaluation team: Invite people from IT, legal, and finance to join you in scoring potential software vendors.

• Apply scoring fairly: Provide guidance for your scoring panel on how to assign values, so there’s less variation.

• Add a comments box: Give everyone space to add notes and comments, to give context alongside the scores.

• Group scores by section: Separate your scoring sheet into sections (e.g. core HR, integrations, implementation) so you can give vendors an overall evaluation per category.

• Give more weight to your priorities: Decide what’s a priority for you (e.g. security and compliance) and assign a greater weight to scores in that section, so you can quickly find vendors that excel in that area.

Completing the scoring matrix leaves you with a clearer idea of what you’re looking for and the tools that meet your requirements. The next step is to turn your findings into a shortlist, then complete the rest of the vendor evaluation process:

• Build a shortlist: Create a list of 3-4 vendors that you want to compare in more detail.

• (Optional) Send out a request for proposal (RFP): Prepare and send an RFP to vendors if it’s part of your procurement process.

• Attend software demos: Schedule and take part in demos and live walkthroughs so you can see the software in action.

• Ask follow-up questions: Send any unanswered questions to your contact so you have all the information you need to choose the right software.

• Make a final choice: Decide which vendor you want to move forward with.

• Negotiate: Confirm the final details of the arrangement, like contracts, pricing, and service level agreements.

• Sign the contract: Make the partnership official by signing the contract.

Personio is a good fit for mid-market organisations in the UK and Europe, but it’s important to consider a range of options — especially at the initial shortlisting stage. 

Personio’s highlights include: 

• Designed for UK and EU security and compliance

• Strong core HR foundation with optional native apps

• Preliminary payroll and UK payroll integrations

• AI assistant for HR, managers, and employees

• Suitable for multi-country and multi-entity organisations

• Fast and supportive implementation process

• Custom quote with no hidden fees

• Compliant with UK GDPR and GDPR

• Strong security considerations, including ISO27001 accreditation

Completing the software requirements checklist should be a team effort. Involve colleagues from HR, IT, finance, and procurement to make sure you haven’t missed anything that’s crucial to another team — especially when it comes to procurement processes and budgets.

Evaluate HR software on its features and functionality across core HR, payroll, integrations, compliance and security, scalability, user experience, implementation and support, AI, and cost and contract details.

Most teams use a weighted scoring system to compare software vendors on a scale of 0-5. A score of 0 means the vendor can’t meet that requirement, while scores 1-5 reflect how well it meets it (1 being poorly, 5 being extremely well). You could reduce the scoring system to 0-3 or 0-10 if preferred, depending on how specific you want to be with your ratings.

The full HR software evaluation process can take between 8-12 weeks, with the initial scoring and shortlisting taking 1-6 weeks depending on the complexity of the project. Weeks 7-12 include booking and attending demos, using trials or walkthroughs, and the final selection, negotiation, and contact signing steps.