For years, the conventional wisdom in HR technology purchasing was to consolidate on a single platform. Buy the big HCM suite, integrate everything, and enjoy the operational simplicity of one vendor relationship. That logic is now being challenged by a growing wave of mid-market HR leaders who are “unbundling” their tech stacks in favor of best-of-breed point solutions.
A recent survey of 1,200 HR technology buyers found that 47% of mid-market companies (defined as 250–2,500 employees) plan to replace at least one module of their current HCM suite with a standalone solution in the next 18 months. The top reasons cited: better user experience, faster product innovation cycles, and frustration with delayed feature releases from large legacy vendors.
What’s Driving the Shift
The rise of API-first platforms and HR data infrastructure tools has made integration far easier than it was five years ago. Middleware solutions that connect disparate HR systems have reduced the technical overhead that previously made best-of-breed stacks unattractive for smaller IT teams.
Modern ATS platforms, in particular, have been the beneficiaries of this trend. Standalone applicant tracking systems consistently outperform the recruiting modules embedded in large HCM platforms on user satisfaction scores, according to G2 and Capterra review data analyzed by LocalWork News.