HR Systems in high gear

It was a busy year in the HR software world. Everyone seems to be acquiring everyone else, and in the end, they all are getting acquired by the very big fish. In the last twelve months alone, Oracle purchased Taleo, SAP purchased SuccessFactors and Infor purchased Lawson. All rising stars, sucked in to the gravitational pull of some very large players.

So what's going on and why all the interest?

Well, some of the themes discussed in previous posts here are creating opportunity and chaos in the "space with many faces". Human Resource Information Systems, aka Human Capital Management, aka Workforce Management, aka Talent Management-Recruitment Management-Learning Management-Compensation Management etc, has been exploding of late. Driving this explosion is a variety of factors:

1. The Knowledge Economy. Everyone knows that their people are their greatest asset. But what is becoming increasingly common is that they are their ONLY asset. Managing and maximizing return on your people has become an essential element of business success
2. The Cloud. As enterprise systems move increasingly to the cloud, the cost of getting access to quality HR systems is going down dramatically. Forrester Research estimates that in the Talent Management space, cloud is out selling on premise 9 to 1. This brings capability to the masses heretofore impossible to anyone other than the Fortune 500.
3. Economics. Finance and HR departments are being forced to do more with less (sometimes referred to as Productivity). The only way to do this is to better leverage systems (preferrably for a low cost subscription fee) to tee up and do a lot of the work.
4. The Need for Integration. The market seems to be preferring a single vendor solution over separate so-called functional best-in-class solutions (hence, all the acquisitions). The obvious drawback of managing data across disconnected systems is overwhelming whatever benefit a brilliant, but siloed solution might provide.

In short, integrated, cloud-based HR systems are in high demand and increasingly being adopted by employers with tens and hundreds of employees, not just tens of thousands.

Here are some of the key functions and process that organizations are looking to better leverage with technology:
1. Comprehensive employee reporting and analytics: everything from employee demographics, pay history, skill sets, work and experience history. Management needs information on their employees across all domains in the organization for compliance, decision-making and resource allocation
2. Recruitment to hire: Efficiently managing the entire process from recruitment to hiring has big impacts on compliance, HR department resources, and of course on who you hire. Capable systems in this space allow you reach outside your internal system to capture applicant data and seemlessly manage that data all the way into your payroll and other systems.
3. Talent Management: allows organizations to define the skill sets and hire the talent they need, develop their people the way they need to be developed and assign them to the right tasks and projects.
4. Performance and Compensation Management: allows organizations to better link performance and pay and manage the processes around both performance measurement and reviews and compensation reviews.
5. Benefits Management: includes employee self-enrollment in benefits plan as well as connections out to external benefits providers. Using technology to help employees better connect with benefits offered by their employers is an approach many employers use to increase employee satisfaction while driving down the cost of administering those benefit options.

These are just a few of the broad topics included in the HR space. Many more exist and within each one, additional levels of detail, process and objectives exist. As HR technology becomes more widely available and as organizations better comprehend the importance of managing their human capital, deeper and broader adoption by companies will continue to explode.