The digitalisation of HR – are your systems in the 21st century yet ?

Digitalisation of HR

I was at the #OracleX conference in Dubai yesterday, which is basically a giant product showcase mixed with some interesting external contributions. It was a really great event, with superb organisation moving hundreds of people at the same time in a flawless way – I’ve never seen that many helpers at an event, but it definitely worked in keeping everything on track and smooth !

Some changes that affect the IT environment, including in HR

The keynote opening session was by Oracle CEO Mark Hurd himself. I was impressed by how “normal” this gentleman was, he had a great delivery style, sense of humour, interesting stats on the future of cloud, and is the boss of one of the largest, most well-known organisations in the world yet did not seem to be ego-driven.

Here are some of his comments, worth sharing for my HR audience :

Up to 80% of IT spend in companies is done on maintenance… and systems tend to be very old in organisations. Consumers, in fact, often have better hardware and newer software than companies !

What does this mean ? That software solutions in organisations are often “behind” in terms of user interface and expectations, and do not fit with the way that people want to interact with their screens nowadays. But also, companies only have 20% of their IT budget to spend on other things than maintenance, including innovation. so they’re struggling hard to keep up with the times.

SaaS is Software as a Service, where you don’t install or buy software on your PC but access it via the cloud.

The SaaS model has overall better economics than traditional IT because you don’t have to buy servers pay heating/cooling, have staff to install and maintain, no testing etc).

The SaaS model brings better security as all security updates are automatically and instantly installed by the provider and come as part of the subscription. Did you know that 74% of organisations take 3 months or more to patch (install updates, including security ones)… yet 99.9% of 2014 exploits had patch available for more than a year ?

The SaaS model also delivers better innovation, because revisions, updates and upgrades come to the client automatically via the cloud as part of the subscription… which means, the CEO or CFO can’t stop the innovation coming because of budget constraints – as Mark Hurd mentioned, great for HR for example as this is the function that tends to get its budget slashed first.

As an independent trainer and consultant, I have to say I agree with these comments. My CRM is on a SaaS model, so is this blog and my social media calendar, my files are all backed in the cloud…. And a lot of my clients are starting to migrate all or part of their HR activities to SaaS models too.

What do I love about this model ? I don’t need to worry about anything technical and can spend my time focused on what matters to me : the functionality of the service. Pricing is known in advance. There are no bad surprises and if ever there is a bug, there is a 24/7 support team working to fix it, whether it’s just on my side, or a bug affecting the whole service.

Mark Hurd also predicted that by 2025, 2 suite providers will have 80% of the SaaS market. Of course, he volunteered Oracle to be one of these two :-). He mentioned that clients would be looking at apps that are not only the best vertically (eg HR, Finance, Supply Chain…) but also that these apps work together seamlessly…. hence the need for integrated suites.

I’m sure Mr Hurd knows what he’s talking about and he probably has a whole team of analysts working on the big trends for the coming 10 years.

But I can also see a market dominated by 2 or 3 giant providers like Oracle for the very large organisations, but with a plethora of smaller, niche SaaS providers who will either address small and mid-size company needs (and budgets), or address specific functionalities that are not taken care of by the giants. Some of these specialist providers are already here today, and they are all compatible with Oracle and SAP for example, so that an organisation may use both solutions at the same time and they can interact through APIs.

What does this all mean for HR ?

Let’s now move into the world of HR a little bit more closely. Here’s a stat I tweeted from Mark Hurd’s intervention  :

Companies have to manage a more diversified workforce.

This workforce is used to getting results fast from its personal suite of hardware and software : social media, wearables tracking your health, getting instant coupons when entering shops, being able to access all their info seamlessly whether through the computer, tablet or smartphone…

Social and media already shape a completely different experience and digital culture. Think online shopping (Amazon with its recommendations, remembering your wishlist etc), customer service (Netflix), hospitality with AirBnB or TripAdvisor : we all perform search before booking, and rely on recommendations, user reviews and ratings…

You may say “well, but this digitalisation has not affected HR yet”. Really ?

Think about it :

  • LinkedIn has more information on people than most HR systems do (languages spoken, skills, education and training/certifications, recommendations on the person’s professional achievements, and even career aspirations).
  • LinkedIn has also completely changed the way recruitment is done nowadays, and digital has almost finished to kill traditional classifieds in newspapers, and even job boards.
  • Despite all their flaws, YouTube and short video is becoming a by-default learning system. Who hasn’t looked for answers on a work-related question on YouTube, watched a TedEx video, taken a course on a MooC or a learning platform like Udemy or Coursera ?

Digitalisation of HR : how can these trends translate in HR software ?

Here are some examples from Oracle, but I’m sure other providers offer this kind of experience too :

  • Using a global HR/Admin database which is through the same provider (so, same interface, global stats and reporting available) but which is locally compliant in each country.
  • Using social integration and performance management results to reduce hiring time and improve hiring quality. The example was Macy’s, the US retailer which hires every year 20,000 temps for the holiday season (November/December). They track which of these seasonal workers are the most positive about their brand and re-invite the top performers year on year, thereby reducing the number of interviews required and the shorten the time-to-hire.
  • In career development, seeing nice visual job descriptions that include a video, testimonials of some employees on that job, links to internal colleagues,  an individualised competency gap analysis (based on the employee’s current competencies)  with recommendations of skills to develop if the employee is interested in this job for a career move.
  • In learning, being able to comment, vote up or down, add and share videos in the learning system, adapting and complementing the content of the training with what employees find really useful.
  • Identifying who is influential in the organisation through the use of internal networks such as Yammer, Sharepoint, or even social media influence (with employee consent) to identify who can become a mentor, who could develop internal courses for better knowledge sharing, or even as a complement to performance reviews. It seems some of the large service firms (the likes of PwC, Accenture etc) are starting to use that.
  • In the US, more and more companies are offering financial incentives to their employees for reaching wellness goals. It keeps employees healthier and healthcare premiums don’t increase as much. Digitalised HR solutions offer fun, visual ways for employees to track their progress and make use of these incentives.

I really enjoyed seeing these examples.

Some are still a bit far-fetched compared to current HR practices in the region, but it’s great to know what’s possible. Because once you see what’s possible, you start thinking differently and you can start your own journey to more modern HR, even if you don’t buy a new HR system.

So, think about it. Is it time for your HR systems to get a good revamp, move to the 21st century, offer employees and managers a great and intuitive interface, and bring you access to really useful reporting and analytics capabilities ?

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Comments

  1. Informative article. Saas has been aliased as an “on-demand software” since it paved its way into the digital workplace setting. SaaS has been one of the best tools to use when it comes to shared processing resources and data to computers and other devices on demand (such as those in a company). Lirik (http://lirik.io/) is a SaaS provider that has something for the different departments a company has, including the HR department.

  2. I agree to overall what’s written above. A lot of information provided is true. I think SAP that a lot of Indian companies use will be modified to saas based platforms whereby we can have employee records and info on cloud networks making it easily available from anywhere but secured as well. Lot of our times somehow goes on maintaining this data in one form or other and over different modules or systems. The intergration of all such modules will help the same.

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