Unlocking ROI in HR Tech: The Role of Strategic Audits

Human resources departments may have a people-centric focus, but the function is increasingly reliant on technology. The modern HR tech stack supports the day-to-day operations of seemingly every position under the HR umbrella. It unites recruiters with job seekers, equips leave managers with absence information, and arms benefits specialists with administration tools.

Adopting HR technology can be a necessity, according to Tim Whitley, director of technology support at Oklahoma State University. As organizations scale, they need systems sophisticated enough to handle their growing employee base.

As technology improves, HR departments are also tapping new tools to propel their own growth, said Jamy Conrad, vice president of people and HR at TrustRadius. Modern technology is allowing HR to be more strategic by enabling data-driven decisions, improving the employee experience, and preparing organizations for the future of work.

Still, many practitioners are dissatisfied with their tech stack. Less than a quarter (24%) of HR employees reported that their organization’s HR function is deriving maximum value from HR technology, according to Gartner. The organization also foundthat only about half (55%) of HR leaders view their current tech solutions as covering their present and future business needs. This gap is troubling, especially considering another of Gartner’s findings: Two out of three HR employees believe if they don’t take action to improve HR’s approach to technology, their function’s effectiveness will decrease.

The culmination of these factors makes regular technology audits essential. These audits ensure that HR’s tech stack is fully operational and properly used. Audits also reveal whether HR’s tech spend is well allocated. This is important information as HR attempts to accomplish greater goals with fewer resources.

“The demands of HR are changing. It’s not just an administrative function. It’s a strategic partnership that allows us more opportunities to be involved with the executive team,” said Conrad. “Our tech stack needs to support our ability to have those conversations in an effective way.”

How to Know It’s Time for an Audit

In an ideal world, the full HR tech stack would be audited at a regular cadence, such as once per year, according to Whitley. Additionally, Whitley said it’s best to perform audits during slower seasons. It would be a mistake, for example, to squeeze in an audit during end-of-the-year budgeting or open enrollment.

Audits sometimes arise naturally, however. For example, an organization may decide to audit its benefits administration system just after open enrollment, when the user experience is fresh in everyone’s minds.

While regular audits are a best practice, Whitley said they’re more often prompted by tech headaches. When a tool or one of its functions goes unused, is used improperly, or causes frustration, HR should initiate an audit. This is especially important given that more than 80% of surveyed HR buyers say they experienced some regret from their software purchase, according to a survey by Gartner. Identifying and addressing pain points early can help prevent buyer’s remorse from turning into long-term inefficiencies.

In any case, organizations should not procrastinate when it comes to performing audits, especially once they’re aware of diminished functionality. Faulty technology can waste employees’ time and energy, resulting in many repercussions on the organization. Audits may also uncover more serious problems such as unnecessary spending, security breaches, and noncompliance. When organizations skip or delay audits, these problems may fester.

Initiating the Audit

Once HR has decided to perform an audit, it’s time to make a plan. Whitley suggested treating an audit like any other project by developing a project charter and plan that contains the following steps:

Pinpoint the Problem

When HR decides to perform an audit, it needs to name its focus. “The most important element is that primary consideration,” Conrad said. “What is prompting the audit, and what are you trying to solve for?”

An audit, Conrad said, is the thorough review and evaluation of all the different aspects of your tech stack (processes, systems, and tools) to determine whether they meet certain criteria. That criteria can change depending on the subject of HR’s audit.

If the team is auditing its leave management platform, for example, compliance may be the primary consideration. Data security may be the guiding principle of an audit on a human resources information system. Similarly, scalability is a popular consideration for audits on system integrations.

No matter the focus, HR should always keep ROI in mind, Conrad said. Audits can be time-consuming, and the change management that results from them can also cost teams significant effort. Auditors should ensure that the time spent on the audit and any resulting action and change management are worth it to the business.

ROI is an especially important factor to consider any time HR approaches leadership to endorse an audit and any changes that may result from it.

“HR shouldn’t be making these business decisions in a bubble,” Conrad said. “It’s important to get buy-in, alignment, and collaboration when going through any kind of business audit.”

Assemble the Team

Once the auditing team has chosen the subject and topic of its audit, it’s time to gather the people involved. After appointing a project manager, sponsor, and coordinator, Whitley creates a process map. If he’s auditing an applicant tracking system, for example, he outlines the entire hiring process to determine the teams that need to be part of the audit.

“Creating a process map gives you insight into who those people are,” Whitley said. “You want to bring them in because they understand their specific piece of the puzzle.”

According to Whitley, IT is always involved in an HR tech audit because it excels where HR has less experience. These topics are germane to IT, and they include governance, security, and privacy.

The IT department also brings a detailed awareness of tools’ capabilities and limitations: IT may be able to address pain points within a system and improve functionality in areas HR lacks access to.

The significance of IT in the audit process underscores the importance of the HR-IT relationship in general. “In all my jobs, I’ve tried to have a regular cadence of meetings with IT, whether that’s once a month or every other week,” Whitley said. “It’s important to have a relationship with the team you’re working alongside so that when these situations come up, you already have people in your corner.”

Planning an Audit? Get Vendors Involved

HR teams using larger software programs should check with their vendors before performing an audit. Why? “The vendor will often do an audit for you,” Whitley said. “They’ll go in and pinpoint specific functions you’re using and others you’re not using.” Of course, most of this information will be tied to sales, so HR should anticipate pitches. Nevertheless, vendors can provide helpful data about how a tool is used that adds detail to an audit.

Line Up the Logistics

Before the auditing team can move forward, it needs to create a timeline for its project. More complicated steps — compliance reviews or legal assessments, for example — should receive generous windows within the timeline.

This step is especially important if an audit involves a third party, such as a vendor or consultant, said Whitley. It’s also key to remote audits. While it’s perfectly feasible to conduct an audit remotely, doing so necessitates clear communication about expectations so team members are responsive and engaged.

Execute the Audit

An audit is an opportunity to determine how well technology aligns with a given goal. Once HR has named that goal, assembled the right team, and planned out its process, it is ready to execute the audit.

Here are some topics HR may approach during an audit:

• Data: HR needs to understand whether the data a tool collects is usable. Is data easy to access, or does it require time and effort to find and analyze?
• Integrations: HR needs to map the places where one system integrates with another, including manual outlets, like spreadsheets. “From a risk and compliance perspective, you want to know what data is being shared,” Whitley said, noting that IT typically understands the flow of data.
• Metrics: Some tech vendors supply metrics to measure the product’s performance. HR should analyze how its tech is performing against these measures and internal guides.
• Scalability: HR should gauge whether a tool is growing alongside its department. “Your tech stack is the foundation of your department,” said Conrad. “How is it going to scale with you?”
• Artificial intelligence: AI is a component of many modern tools. Its popularity doesn’t guarantee that it’s used responsibly, however. HR should ensure its tools take full advantage of AI while also using it in a way that’s wise, transparent, and compliant.

One of the most important considerations for an audit is the user experience, according to both Whitley and Conrad. It’s essential, then, that users take part in an audit.

Auditors may need to meet with the HR reps who interact daily with an absence management platform. The team may also need to send out an organization wide survey to ask employees about their experience with benefits administration tools. Exercises like these will draw out details that are key to a successful audit.

Including the people who use a tool in an audit will reveal how people use the product, Whitley said. A tool may not be working due to people using it incorrectly rather than  any lack of functionality.

“As HR or IT people, we see tech through a certain lens, but your end users are going to see it from a completely different lens,” Whitley said. “If you’re not designing technology around their experience, then they’re not going to use it or they’re going to be unhappy with it.”

Applying the Results

Once an audit has been performed, it’s time to begin making sense of the results it generated. Conrad begins with data analysis to determine the problems the audit revealed. Then, she prioritizes those problems depending on their business impact.

Whitley approaches audit results with a similar process. He prioritizes post-audit projects based on urgency: Compliance problems need fixing right away, but minor efficiency problems can wait a while. Whitley also asks himself a few questions at the end of the audit:

• Do we want to continue with this system?
• Do we need this functionality?
• Are we happy with this vendor?

For Whitley, an audit is also a chance to consider other options. “I think it’s a good idea to go through with a request for proposal regularly,” he said. “It’s a good time to see what else is out there.”

After Conrad has created a post-audit plan, she approaches key stakeholders to get another perspective and to generate buy-in. These stakeholders include IT, security, leadership, and employees who use the technology.

Finally, Conrad creates her plan of action. This plan includes change management strategies, resource allocation, timelines and milestones, and success metrics.

Both Conrad and Whitley note that this part of the audit is a strategic place to use generative AI (GenAI). An audit generates immense data, including process maps and interview notes, said Whitley. Tools like ChatGPT can synthesize that data, summarize findings, provide insights, and pinpoint where auditors need more information.

“If you can include automation and GenAI in your process, it helps make things a little cleaner, typically improves audit efficiency, and narrows the focus on the strategic aspect,” Conrad said.

Conrad cautioned against blind trust in GenAI’s recommendations, however. GenAI can speed up data analysis, build a change management plan, and make an audit more efficient and effective. “But just like anything else that’s new in tech, you want to build in checks and balances,” she said.

Auditors who take advantage of GenAI or another type of AI need to double-check the accuracy and account for bias. And, of course, teams need to comply with data protection laws and use AI in a way that’s ethical and transparent, Conrad said.

Keep People the True Focus

As HR hones its auditing process, it’s important to remember the audit’s overarching focus: your people.

HR tech audits will not only help HR understand how people use the tech they’re equipped with. The process will also reveal how the tech is serving people, including whether it enables them to do their best work or hinders their performance and productivity.

However, uncovering these insights is only part of the journey.

Change management plays a critical role in ensuring that audit findings translate into meaningful improvements for employees. Implementing new tools or optimizing existing ones requires thoughtful communication, training, and ongoing support to help employees adapt to changes. When change is managed effectively, employees are empowered to engage with technology in ways that enhance their productivity and job satisfaction.

Every audit should aim to provide “a holistic perspective,” Whitley said. “It’s not just about the technology. It’s about how people are interacting with the technology.”