Over the last few years, many companies have started to invest more into their performance management processes. The right performance management software can bring great value to businesses, especially as workplace dynamics and organizational demographics change. But most buyers have never bought a performance management solution before and don’t know how to effectively purchase new software.

The right performance management software platform helps:

a) Employees understand where they stand and identify opportunities for growth.

b) Managers engage with their direct reports in a timely and tailored manner.

c) Businesses gain data-driven insights for  succession planning and skill gap analysis.

However, as many buyers know, the wrong solution can result in  low adoption and wasted spend. So, how do you – a savvy HR software buyer – get the decision right?

Internal Alignment

1. What Are Your Biggest Drivers?

When it comes to finding the right performance management software, the most important starting point is determining your top buying priorities. A common mistake that buyers will make is going out to market without a clear idea of what they’re trying to solve for. When this happens, it’s easy to get distracted by flashy features or lowest cost options without giving enough thought to what will be most impactful for the business.

We always recommend our clients boil their needs down to a few key outcomes by asking the question: If this project could only succeed in three areas, what would those be?

Common goals include: 

  • Better insights into employee satisfaction
  • Tighter integrations with an HRIS system
  • A more continuous and engaging review process for employees
  • Additional tools and analytics for people managers to leverage

2. Who Is Invested in Change?

Another important step before going to market is to socialize the idea of a new system with your team and other stakeholders. The last thing that you'll want to do is spend hours falling in love with a certain software platform, only to find out that your teammates aren't onboard with the decision.

A best practice is to have a project kick-off call with team members and other stakeholders. In this meeting, ask each member of the project team two questions:

  • What do you hope to get out of this transition?
  • What do you need to see from a vendor to be comfortable with moving forward?

By having this meeting before going to market, you can (1) continue to refine your project objectives and (2) determine where your colleagues stand on making a transition.

Going to Market

3. How Are There So Many Options?

Now that you’ve started to define what you’re looking for, the next step is to figure out who can potentially meet your requirements. If you visit a software review website, such as G2 or Capterra, you might be stunned to learn that there are dozens of performance management solutions in the market.

It might seem counterintuitive, but having a broad initial list is actually a good place to start. It’s better to start broad and know why you eliminated certain vendors than to start too narrow and wonder later “How come we never looked into Vendor X?” 

Build your initial list by canvassing review websites and blogs, and reaching out to your colleagues and peers to see which names pop up the most. There are also free services that can recommend the right vendors for you, based on your requirements and goals.

4. How Do We Rule Out Vendors Quickly?

There are three great ways that you can rule out potential options without having to take any sales calls:

  • Mis-matched functionality - Check out software vendors’ websites to see if any of them do not have key modules that are in your requirements (i.e., vendors that only do performance management, but not engagement surveys). Another thing to look for is if the vendor is a standalone performance management vendor, or if their performance management solution is part of a broader HRIS bundle. In those latter cases, you often won’t be able to buy just the performance management software by itself.
  • Size Match & Scalability - Go to software review websites and see what sized companies are predominantly reviewing these platforms. If all of the reviews come from companies with fewer than 50 employees, you'll know this is an SMB tool and might be too limiting. Vice versa, if all of the reviews are from companies with 1,000+ employees, you'll know this is an enterprise tool and might be too robust
  • Low Market Presence - Check each software vendors' LinkedIn page to see how many employees they have, as well as their Crunchbase page to see their ownership structure and funding. Also look at different review websites to see how many reviews they have. You don't need to go with the biggest option in the market, but the vendor should have a decent sized team, some customer reviews, and growth potential

Being Prepared

5. What Haven’t I Considered Asking?

It’s never a good idea to show up to vendor meetings empty handed and expecting the salesperson on the other end to give you all of the answers you're looking for. Your job is to be the one driving the evaluations.A best practice is to come up with a list of questions to ask before going into the meeting. Some questions will be obvious and covered in a standard demo, but other questions may not be obvious until it’s too late. Here are some examples of good questions to ask:

  • Service. What is your company’s service model? Do we get a dedicated point of contact or ticketing system? What access to training will we have after go-live? 
  • Integrations. Has your system built integrations with X, Y and Z before? Are those integrations pre-built, or would we have to build our own during implementation? Who is responsible for the cost of building and maintaining the integrations? Should integrations be bi-directional or one-way?
  • Scalability. What is your average customer size? If we need to create a custom review process, how would we do that? Can your system support multi-FEIN companies while still providing holistic reporting?
  • Future Growth. What are features on your upcoming product roadmap? What is your company’s overall mission & vision? Will your ownership structure change in the near future?

Buying With Confidence

6. Can We Speak to Customers?

References can be hit or miss for buyers. The right reference can provide great insights into what to expect from the partnership. On the other hand, many references are available because they had the perfect experience, which may not always be replicable.

It’s always a good idea to request references from your top two finalists. Also, be specific about what type of reference you want (i.e., someone who left the same platform as me, is in the same industry, built a similar integration, etc.)

When speaking to those references, your goal should be to get an understanding of what the day-to-day partnership feels like. Ask about support turnaround times and the process of setting up integrations, as well asheadaches and frustrations.A great question to ask is always: What did you wish you knew when you were in our shoes?

7. Is That The Best You Can Do?

Negotiations are an underutilized step in the software buying process. Buyers assume that software list prices are fixed and can't be moved. But in our experience, almost every single buyer who negotiates ends up with a better deal. We've built a long guide detailing how to negotiate, but a few of the key things to keep in mind are:

  • Annual software fees are always more valuable than implementation fees.
  • Negotiating is all about a give and a take. So if you want better terms, you'll likely have to agree to signing a contract by a certain date.
  • Your sales rep is your ally, so arm them with what they need to bargain on your behalf.

At the end of the year, HR decision makers are considering which tools will help them meet their organization’s needs. Whether you’re interested in improving overall employee performance or keeping up with a rapidly growing headcount, these tactics can provide some peace of mind in knowing that you made a thoughtful and well-informed choice in your performance management platform.


Brett Ungashick is the founder of OutSail, a Denver-based company that provides free services to help HR teams research, evaluate and select new technologies. Brett started his career by selling software to HR teams at LinkedIn, before recognizing a growing need from software buyers for support throughout their buying processes. OutSail was founded in 2018 and has helped over 500 companies with new HR software purchases including companies like SalesLoft, DoorDash and the Boys & Girls Club of America