Key Finding from isolved’s Fifth-Annual HR Leaders Report: Elevating HR in the Age of AI
March 19, 2025
By Chris Harvey
Most organizations don’t get to celebrate their 5th anniversary with their HCM provider. The reason? Their system simply doesn’t keep up with their evolving needs and eventually has to be replaced.
One of the most common mistakes HR leaders make when selecting an HCM solution is focusing too much on features and functionality.
Of course, functionality is critical—if a system lacks the capabilities your organization needs, it won’t provide much value. However, the vast majority of today’s HCM solutions perform adequately to exceptionally well in meeting business requirements.
But what about the future? How do you ensure your chosen solution will support your organization’s long-term needs? You need an
HCM platform that can adapt to the unexpected—such as the rapid workforce shifts triggered by the COVID-19 pandemic.
Many HR leaders I’ve spoken with express frustration over having to replace their HCM system just 18, 24, or 36 months after
implementation because they’ve outgrown it. No one wants to go through the selection process again just a few years down the road.
Recent research from isolved’s Fifth-Annual HR Leaders Report: Elevating HR in the Age of AI highlights HR leaders' concerns about forming strong, long-term partnerships with their HCM providers. Let’s explore key findings that can directly impact your decision when
selecting an HCM platform.
Too Many HR Systems
HCM adoption has surged in recent years, with 93% of organizations now using some form of human capital management technology. However, many companies struggle with fragmented systems. In fact, 58% of HR leaders report using four or more HCM solutions, and 17% use ten or more. This creates inefficiencies, increases compliance risks, and reduces data visibility.
One of the primary drivers for switching HCM platforms is the need for consolidation. 21% of HR decision-makers cite having too many systems as a reason for seeking a new solution. An integrated platform that connects all HR functions—payroll, time tracking, benefits, compliance, performance management, and analytics—can streamline operations, improve efficiency, and eliminate costly data silos.
Scalability and User Experience: Top Priorities for HR Leaders
When evaluating new HCM solutions, HR leaders prioritize more than just functionality.
isolved's Fifth-Annual HR Leaders Report: Elevating HR in the Age of AI contains additional insights on embracing AI, the talent crisis, prioritizing employee total wellness, long-term HCM partnership, and more.
According to the isolved’s HR Leaders Report, the top reasons HR teams switch providers include:
- A better user experience (37%) – Systems should be intuitive and easy for HR teams and employees to navigate.
- Scalability (35%) – Organizations need an HCM platform that grows with them, whether that means expanding into new locations, adding headcount, or adapting to evolving compliance requirements.
- Better reporting and data visibility (32%) – Real-time workforce insights empower organizations to make informed decisions and proactively address challenges.
Other key motivators include security concerns (21%), service issues (20%), and digital transformation initiatives (20%). The message is clear: Organizations aren’t just looking for an HCM solution that works today—they need one that can evolve with their business.
The Right HCM Partner Supports Long-Term Growth
Selecting an HCM provider is about more than just software—it’s about choosing a strategic partner. HR leaders expect their vendors to be proactive, responsive, and invested in their success. According to the isolved’s HR Leaders Report, the top expectations from an HCM vendor include:
- Supporting organizational growth (42%) – A vendor should provide solutions that scale seamlessly as the business expands.
- Responsive customer support (39%) – Fast, knowledgeable support helps HR teams resolve issues quickly and maintain smooth operations.
- Ongoing security investments (37%) – With 53% of HR leaders concerned about potential data breaches, security must be a top priority.
Beyond these priorities, organizations are also looking for vendors that continuously innovate (34%) and offer best-practice guidance (31%). The right HCM provider doesn’t just sell software—it partners with HR leaders to manage workforce complexity and drive business success.
Your Last HCM Solution
With so many HR leaders considering a switch in HCM technology, the focus must shift from short-term fixes to long-term partnerships. The right HCM solution will consolidate software, scale with your organization, and provide the security and insights necessary to drive business success.
Ultimately, you shouldn’t be looking for just your next HCM solution—you should be looking for your last HCM solution. One that will support your business for 5, 10, or even 15 years. By prioritizing strategic fit, adaptability, and vendor commitment, HR leaders can select a platform that stands the test of time.
More HR Leader Findings
The isolved’s HR Leaders Report contains additional insights on embracing AI, the talent crisis, prioritizing employee total wellness, and more. You can access the full report at isolved’s Fifth-Annual HR Leaders Report: Elevating HR in the Age of AI.
Thank You to isolved
I’d like to thank isolved for providing me with an early look at the isolved’s Fifth-Annual HR Leaders Report: Elevating HR in the Age of AI and for sponsoring today’s edition of the HR Tech Compass Newsletter.
The Ultimate HR Product Comparison
From ADP to Workday and everywhere in between...
A 1-page comparison of the 18 top HR tech solutions for small and mid-market organizations across 20 different aspects of feature/functionality.
