Human Resources (and People and Culture) professionals are increasingly responsible for more than managing employees and workplace matters. They also play an important role in identifying, evaluating and purchasing the products and services that support an organisation’s workforce. These purchases can range from recruitment and HR consulting through to payroll systems, HR technology, learning platforms, employee assistance programs, workplace safety services and remuneration advice.
HR as an informed buyer
HR professionals are often well placed to lead or significantly influence purchasing decisions because they understand both the workforce problem and the practical environment in which a solution must operate.
The role should not simply be to find a supplier. It is to clearly identify the business requirement, understand the available market, assess suitable providers and help the organisation select a solution that delivers appropriate value, capability and risk management.
The Chartered Institute of Personnel and Development recommends that organisations consider factors including the required level of expertise, specialist knowledge, organisational requirements and supplier capability when procuring external people expertise (CIPD 2026).
For significant purchases, HR may also need to work with stakeholders such as Procurement, Finance, IT, Legal, Privacy and operational management.
A practical HR purchasing process
A structured process does not need to be complicated. The level of due diligence should reflect the value, complexity and risk of the purchase.
Define the problem - Clearly identify the business or workforce problem that needs to be solved rather than starting with a particular product or vendor.
Establish requirements - Determine essential requirements, desirable features, budget, implementation needs, risks and measures of success.
Research the market - Identify a reasonable range of potential suppliers and alternative solutions rather than relying only on familiar providers. Australian HR professionals can use Workforce Directory to search and compare Australian providers across areas including HR consulting, recruitment, payroll, HR technology and other workforce services (Workforce Directory 2026).
Develop a shortlist - Compare providers against consistent criteria such as capability, experience, functionality, service, security, compliance, implementation requirements and total cost.
Evaluate and conduct due diligence - Request demonstrations, proposals or quotations where appropriate. Check references, contractual terms, data handling, insurance and other relevant risks.
Select and contract - Choose the solution offering the best overall fit and value, rather than automatically selecting the lowest price. Clearly document deliverables, responsibilities, service levels and performance expectations.
Review performance - Measure whether the supplier and solution are delivering the expected outcomes and periodically reassess whether the arrangement remains suitable.
Present Recommendations to Management - Share findings and recommendations with management to secure their input and support.
This broadly reflects established procurement principles of defining business needs, developing specifications, analysing the market, evaluating suppliers, contracting and managing supplier performance (CIPS 2026).
Better purchasing starts with understanding the market
HR professionals do not need to become procurement specialists, but they should be informed buyers. Understanding the problem, researching the broader marketplace and objectively comparing alternatives can help organisations make better purchasing decisions while discovering providers and solutions they may not previously have considered.
In a rapidly developing HR marketplace, the ability to look beyond the familiar supplier can be just as important as negotiating the final price.
References
Chartered Institute of Personnel and Development (CIPD) 2026, How to use the Profession Map to select external people expertise, CIPD, viewed 28 August 2026, https://www.cipd.org/en/the-people-profession/the-profession-map/how-it-works/for-commissioning-procuring-external-expertise/
Chartered Institute of Procurement & Supply (CIPS) 2026, CIPS Procurement and Supply Cycle, CIPS, viewed 28 August 2026, https://1prd-dxp.cips.org/intelligence-hub/procurement/procurement-supply-cycle
Workforce Directory 2026, Australia's Workforce Solution Directory, Workforce Directory Australia, viewed 28 August 2026, https://workforcedirectory.com.au/
