Many ERP-based systems tend to manage end-to-end recruitment and HR process effectively. Yet, we are witnessing a global trend post-2017 towards ‘point solutions’ in HR tech. These platforms focus on one specific area of the HR process, such as candidate sourcing, video interview, assessments, candidate engagement, onboarding, and so on. New-age point solutions can be easily integrated with HR platforms, enabling companies with a variety of highly specialised tools that match their needs.

Here’s an illustration of the various point solutions available in the market that are digitising key recruitment and HR processes worldwide.

Some notable advantages of point solutions:

• Flexibility: Point solutions offer a lot of flexibility in terms of customisations, unlike ERPs, which are generally built around a “one-size-fits-all” model.

• Anytime, anywhere integration: Point solutions can be integrated with your existing systems across several branch locations.

• Pocket-friendly: These are available in packages where you can select only the features and modules that align with your processes, making them relatively inexpensive.

• Best-of-breed solution for a specific department: Point solutions effectively address the technological gaps and needs of a specific function/department and incorporate centralisation and digitisation.

• These come with deep functionality features and can be effectively aligned with every step of the business process and practice.

• Expertise of a specialised technology partner: With deep technological expertise, point solutions help to optimise specific HR processes with quick benchmarking and standardisation.

• Point Solutions can be customised, and hence, one module can be maintained without affecting the other modules.

Like two sides of the same coin, the advantages of point solutions also come with disadvantages. For instance, these work very well for small to medium-sized companies, where there aren’t highly complex and elaborate operational business models. Point solutions are designed to bring functional and technological expertise to specific departments, with an added focus on streamlining specific business processes. However, in MNCs with large-scale operations, point solutions prove to be inefficient and resource-consuming. Let’s take a look at some of the downsides of point solutions.

Disadvantages of point solutions:

• Seamless data integration with other tools is a challenge.

• If you happen to integrate multiple point solutions with multiple processes within your business, managing multiple systems and vendors will prove to be both time-consuming and resource-draining.

• Comprehensive understanding of all the features and functionalities of point solution-based technology tools requires thorough end-user training. Multiple parties must coordinate, and several training sessions need to be organised. Also, regular refresher training will also be needed.

• Adopting many point solution-based tech tools to automate your HR processes could result in a complex ecosystem of standalone technologies integrated together.

• Troubleshooting problems and technical glitches prove to be difficult with point solutions, since these are tailored to suit specific business needs, and it takes more time and effort to correct certain problems without affecting other functionalities.

• Designed for individual HR processes, point solutions fail to provide a 360-degree view of customer interactions across touchpoints.

• Deploying several point solutions will prove burdensome for the IT team in terms of providing support and maintenance.

• Point solution for one department/function will not benefit the organisation as a whole.

• It will be challenging to manage and adapt to the constant updates of their UI/UX and data models.

• Since every vendor will charge for their tools separately, the total cost of ownership (TCO) may increase dramatically.

Are ERP-based platforms the way of the future?

ERPs are built for streamlining end-to-end processes. When integrated into a business process, ERPs make for a centralised platform that brings consistency to all the processes throughout the spectrum of the operational structure. While this looks like a simple way to go about digitising end-to-end operations, these platforms are rigid and can’t be customised thoroughly, unlike point solutions. Hence, implementing ERP-based technology in your business might need you to change certain processes in order to map to the ERP tool’s functionality, instead of vice-versa. Moreover, change management in such a scale will dramatically increase the spend, time, and effort throughout the tool adoption process.

Implementing an ERP-based platform gives you the following benefits:

• Provides a 360-degree view of data across departments

• There is a single technology partner, unlike in the case of point-based solutions

• Requires fewer integrations, resulting in lower implementation and training costs

• Lower maintenance costs due to a single technology stack.

• The ability to innovate and adapt to changing market trends as the tool evolves over time and releases technology updates to ensure that your operational model fits into the new-age order

• The total cost of ownership is lower with improved end-to-end business processes.

Conclusion

Choosing between ERPs and point solutions depends on the size of your business and also on the complexity of the operational structure. If the business’s scale of operations is small, point solutions may well be your go-to technology solution, bringing deep functional expertise to specific business processes that you feel must be optimised. The bigger and more complex the organisational structure and the operational model, a simpler solution, such as an ERP, will prove beneficial for digitising end-to-end operations, although the platform is rigid and not customisable to a large extent. Lastly, analyse the gaps in the operational structure of your organisation and evaluate the relevance of all modules in the ERP (for both the present and the future) before you decide.