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Top 5 Trends in HR Technology

Written By: Sherry Fox
Published On: December 2 2009

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Over the last decade, the face of human resources (HR) has changed dramatically. What was once a seemingly low-priority department has now become an integral part the organization—and its bottom line. Today, HR is all about the understanding that maintaining a positive and productive work environment is good for business.

Accomplishing this more-than-ideal scenario can seem difficult because many organizations don't understand what is required. So, how can today's businesses manage this change? Simple: by adopting HR best practices and leveraging HR technology.

Recession or not, innovation in HR technology continues to grow and to alter the way in which people work. This technology impacts all of us—in both our personal lives and in the workplace. It's important that we continue to embrace technology in order to have the tools that will help create better communication and collaboration within our grasp. Technology (e.g., social networking, mobile phones, etc.) helps people connect within their work environments and fuels the potential for increased productivity and creativity.

But no matter what the current trends are, the most important point remains: organizations need to keep both their current and future workforce requirements in mind before turning to a new solution.

As we approach a new decade, here are five of the top trends that I believe are making the biggest impact in the HR arena.

  • talent management
  • social networking
  • outsourcing
  • software as a service (SaaS)
  • mergers and acquisitions (M&As)

1. Talent Management
Talent management adds to the core HR mix, providing a combination of recruitment, performance and compensation management, succession planning, and more. As such, the enterprise software industry has seen a drastic increase in vendor offerings—as well as the types of vendors who are selling them.

This year's 12th Annual HR Technology Conference & Exposition in Chicago, Illinois (US) was proof that talent management is alive and well, and making an impact on the way organizations do business. Today, both talent management and employee development are critical in determining an organization's performance potential. But it's the ability to manage performance that often sets organizations apart—and the primary differentiator between an organization that produces so-so results and one that exceeds their expectations.

Talent management is a strategy that combines core HR functions such as, personnel administration, payroll, and benefits with acquisition, development, and performance. These solutions provide a comprehensive suite of tools that helps organizations take a more strategic approach to the way they select, manage, and retain their employees.

The vendors that offer talent management solutions today are an extremely diverse bunch. This can make it difficult for HR decision makers to determine which solutions can truly satisfy all their needs. The decision makers need to decide which solution is better for their organization by determining whether or not to purchase an out-of-the-box HR solution, an learning management system LMS solution that fits nicely with their current core HR system, or an enterprise resource planning ERP system that can replace many of its separate solutions. The combination of systems available is endless.

The five main types of talent management offerings include

  • traditional HR vendors that have added talent management functionality to their core HR applications;
  • ERP vendors that have developed talent management add-ons to their core product(s);
  • LMS vendors that blend learning with talent management;
  • niche players that focus on one particular area of the talent management spectrum (e.g., applicant tracking, recruitment, workforce management, performance management, etc.); and
  • talent management software vendors that focus solely on the four pillars of talent management (recruiting, performance management, learning management, and compensation management).

Here are some key vendors in the talent management space.

VENDOR SOLUTION FOCUS
Lawson Software Lawson S3 Human Capital Management human capital management
SABA Saba Talent Suite human capital management
Cornerstone OnDemand Talent Management Suite learning and talent management
Halogen Talent Management Suite learning, performance, and talent management
Taleo Taleo Edge; Taleo Enterprise Edition performance and compensation management
icims Talent Platform applicant tracking, onboarding, performance management, and succession planning
Salary.com TalentManager Suite performance, compensation, incentive management, and succession planning
Bond International Software Bond Talent; Bond Adapt; Bond Spirit onboarding, recruiting, human resources, and payroll
SumTotal Talent Development Suite learning, performance and compensation management, and content creation

Figure 1. Talent Management Vendors.

2. Social Networking
Over the last five years, social networking—in the form of intranets, wikis, messaging centers, blogs, and more—has changed the way many organizations handle their corporate training and talent management. Today's social networking sites (LinkedIn, Facebook, MySpace, and Twitter) are also adding to the ever-changing HR landscape. This is happening so often that many talent management and HR vendors have now begun offering enterprise social networking as part of their employee profile functionality. Conversely, many employees have come to expect a work environment that is supported by these available collaborative resources.

But social networking is not a new concept by any stretch of the imagination. Knowledge sharing and collaboration have been around for years in the world of learning management. Long before LinkedIn and Twitter hit the scene, LMS vendors were bringing people and knowledge together through the use of discussion boards, live chats, etc.

Today's collaboration networks help provide HR departments with instant and continuous feedback from employees (whether they are in management or not) in the areas that are important to the employee personally as well as to the organization. While these sites are useful for sourcing job applicants, reaching out to potential customers, and fostering a feeling of community within the company, they can also decrease productivity and increase security risks. As such, there has been an increased need for companies to create or "beef up" their internal HR policies.

Here is a list of social networking providers/channels—many of which are free—that are using social networking to help organizations leverage their user knowledge and collaboration.

Most Common:

  • Twitter
  • Facebook
  • MySpace
  • LinkedIn Ltd.

3. Outsourcing
Whatever your organization's HR requirements are, there's a human resources outsourcing (HRO) firm out there that can meet those needs. While some HRO firms are generalists that offer a wide variety of services, others are considered HR specialists that focus on very specific areas within the HR spectrum (e.g., business processes, recruiting, or payroll). Depending on the type of business you run, its size, and how much control you want to maintain over HR functions, there are generally two outsourcing options available. You can choose to

  • outsource all of your HR tasks; or
  • contract out those areas that require improvements that cannot be handled by internal staff.

Between keeping up with the latest governance requirements, trends, and best practices, today's HR executives already have enough on their plates. Outsourcing traditional (and sometimes non-traditional) HR functions provides a way for these executives to free up time for more strategic efforts. Outsourcing HR transactions is a proven way to control and reduce costs—while getting a greater level of service.

Some of the basic services offered by HRO firms include

  • overseeing organizational structure and staffing requirements;
  • providing unified HR, time, payroll, and expense tracking;
  • offering recruiting, training, and development services; and
  • tracking department objectives, goals, and strategies.

Organizations outsource their HR services in order to

  • allow HR departments to focus on strategic efforts;
  • gain specialized expertise in a variety of areas;
  • access innovative technologies which ensures technology is continually upgraded;
  • reduce costs through automation and process improvement; and
  • minimize or transfer legal risk to the outsourcer for regulatory compliance issues.

OUTSOURCER

AREAS OF EXPERTISE IN HRO

Accenture HR

talent acquisition and management, and employee productivity

Automatic Data Procession (ADP)

payroll, human resources, and benefits

Ceridian

HR administration, payroll, and benefits

Convergys

payroll, benefits, recruiting, compensation, learning, and performance

ExcellerateHRO

workforce administration, payroll, benefits, and leave administration

Mercer

Employee engagement, absence management, health and benefits administration

TriNet

benefits, payroll and human resources

Watson Wyatt

benefit, talent management and compensation

Figure 2. HRO Vendors.

Here are a few links that companies looking for HRO experts might find interesting:

4. Software as a Service (SaaS)
When SaaS—often referred to as software on demand—comes to mind for most IT decision makers, the first thing they think of is: "What about security?" This holds especially true for those in charge of acquiring an HR system for their organizations—for which keeping employee records under lock and key is crucial. Maybe five years ago security was an issue, but today the SaaS model is gaining ground, and more and more businesses—both big and small—are giving in to the trend. Some of the main reasons for this trend are directly related to the benefits that SaaS provides. These include

  • continuous access;
  • rapid deployment;
  • high levels of security;
  • cost savings; and
  • time efficiency.

Rather than spending hundreds of thousands of dollars on software licenses and hardware, companies can choose to go with an on-demand HR solution for which they are billed on a monthly basis—and only for the modules they use. Additionally, there's no need for complex upgrade cycles, since the on-demand applications are automatically updated and routinely delivered to customers.

The bottom line: SaaS can deliver the same HR functionality as its on-premise counterpart. The following is a list of enterprise software vendors that offer SaaS—among other options.

VENDOR

SOLUTIONS

Workday

Workday Human Capital Management™, Workday Payroll™, Workday Worker Spend Management™, and more…

Ultimate Sofware

UltiPro® Enterprise and UltiPro Workplace

Softscape Inc.

Softscape HR Management, Softscape Workforce Performance, Softscape Learning Management, and more…

Accero

Accero On-Demand, Accero On-Demand PLUS™, Accero Cyborg

SuccessFactors

SuccessFactors; SuccessPractices

LaserBeam Software

LaserComp

Figure 3. SaaS HR Vendors.

5. Mergers and Acquisitions: Technology Times Two
The recent recession has proven to be difficult for many businesses—software vendors included. In 2009, mergers and acquisitions (M&As) have become a common phenomenon. This past year, we've seen some of the smaller players get scooped up by the giants, while others were working on negotiations to improve on what both parties do best—merging two entities together to become one bigger and better organization. However, that's not always the case.

According to HR.com, "the reality is that as many as two thirds of all mergers and acquisitions fail to achieve the anticipated benefits." The uncertainty brought out by poorly managed HR issues in M&As has often been the major reason for these failures.

M&As also prove to be quite traumatic for the employees of the firms involved and the reaction can range from stress, to anger, to depression, etc. Often the impact of these M&As is high turnover, and decreased morale and motivation—not to mention waning productivity.

But not all M&As have fail. There are some that have proven to be quite fruitful. Some notable M&As in the HR space over the last year are listed in the table below:

VENDOR

 

HIGHLIGHTS

Spectrum HR and Deltek, Inc.

Merger

Spectrum Human Resource Systems Corporation and Deltek, Inc. collaborated to interface their industry-leading enterprise application and human resources information systems (HRIS) software to bring the project-based industry an ideal HR solution.

Automatic Data Procession (ADP)

Acquisition

ADP acquired a majority stake in Shanghai-based human resources outsourcing service provider ChinaLink Professional Services.

Arbita and JobMachine

Merger

Arbita merged with JobMachine to further empower its customers to hire more and better people faster. The merger gives customers access to an integrated line of services, combining job ad distribution and recruitment solutions with alternative methods for candidate sourcing.

Sage Software

Acquisition

Sage acquired the payroll and human resource management system (HRMS) aspects as well as all customer contracts from Crystal Info Solutions of Chennai (India).

Salary.com

Acquisition

Salary.com signed a definitive agreement to acquire Genesys Software Systems, Inc.—a leading provider of on-demand HRMSs, benefits, and payroll services.

Convergys

Acquisition

Convergys recently acquired Intervoice—a provider of personalized, multichannel automated information solutions, allowing it to enhance and accelerate relationship management solutions for its global clients.

Talent Alliance, Inc. and Soar Consulting, Inc.

Merger

Talent Alliance, Inc. a global provider of talent acquisition and talent management solutions, has completed a merger with Soar Consulting, Inc., a leading provider of military transition recruiting.

Exact Software

Acquisition

Exact Software acquired the InterConnect solution from Interactive Technology, which allows organizations to have a single interface for critical operations.

Figure 4. Human Resource Vendors: Mergers and Acquisitions.

While there are many cool new tools and solutions available on the market—as I discovered at the HR Technology Conference in Chicago—in this article, I aimed to cover just a few technologies that I believe we'll be seeing a lot more of in the years to come. While nothing is particularly new about these trends in and of themselves, they are nevertheless making their way into the HR arena.

No matter what state the economy is in or what the current HR technology trends are, it's important that organizations keep in mind both their current and future workforce requirements and define their short- and long-term HR strategies—before turning to a new solution.

To start your HR software selection, visit TEC's HR Evaluation Center.

Further Reading

Top HRO Outsourcing Vendors, Black Book Survey 2008 Results
Software as a Service
Mergers and Acquisitions
Spoke Software, Inc.
Visible Path, Corp. (Hoovers Connect)
Akamai

 
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