There Was Once no Such Thing as Human Resources
The first HR department, or at least something like it, didn’t exist until the beginning of the 20th century. This may be hard to believe in a world where we’re always looking for new employees and ways to get them more involved.
Most people think that The National Cash Register Company set up the first human resources department in 1901, after several strikes and lockouts. Even though it was called “personnel” at the time, the new department’s main focus was on compliance, keeping records, workplace safety, wage management, handling employee complaints, and training supervisors on new laws and workplace practices.
Fast forward to today, the role has grown and expanded significantly. And it will continue to evolve. According to The Future of Job Report by Willis Tower Watsons, almost 90% of HR job roles today will be impacted by technology in three to five years.
The study identifies three key trends driving HR technology transformation and will significantly change the expectations that business stakeholders have from HR. These include
Advent of intelligent automation.
Rising expectations of employees for consumer-grade applications.
Shift from basic data analytics and reporting towards predictive analytics and modelling to provide insights for talent decisions.
This may be why more than $12 billion in venture capital were poured into the HR technology market in 2021, with the investment rate more than tripling from the previous year. HR technology is critical for retaining employees and getting the most out of them. This is achieved by saving time, allowing employees to improve, and avoiding repetitive jobs that can lead to burnout, a problem that has harmed workforce numbers.
Furthermore, it may extend into enabling the companies to save money by optimising processes around payroll, travel and expenditures, talent management, performance management, benefits, and learning and development.
Picking Your HR Technology
Despite the rate of HR tech introduction at the workplace, the expectations gap from employees remains high. People all over the world have become savvy digital consumers as a result of seismic transformations in technology and society. Everyone (workers, candidates, and HR practitioners) expects technology to deliver high-quality processes in an intuitive, quick, and ‘don’t make me think’ manner.
And because we’ve had this experience as customers, we demand it in all aspects of our life, both at work and home. This leads to a fundamental trend in modern HR directors’ responsibilities to purchase, integrate, and operate HR technologies that give experiences rather than processes. But sifting through the dozens of HR technology options on the market can be intimidating.
Great leaders must manage complexity and uncover complex issues before making an investment decision. Therefore, the first question enterprise HR leaders face when looking to expand the scope of their HRMS is: do I buy best-of-breed or all-in-one?
All-in-One Versus Best-of-Breed
All-in-one HR tech is a piece of software that can carry every feature needed to perform every single spectrum of the HR function. In the enterprise space, one will instinctively think of SAP SuccessFactors given its capabilities to perform Core HR Administration, Time Off, Benefits, Time-tracking, Talent Acquisition, Talent Management, Workforce Analytics and many more.
Given that all these features/modules come from the same provider, users can be assured of their seamless integrations. On the other hand, Best-of-breed specialises in solving a narrow problem statement and often does it very well.
They go deep into the space they are in and are usually more comprehensive than all-in-one tech, given that it is the key focus of the entire company. For example, Visier only focuses on people analytics, and their 549 employees (LinkedIn) only work on that problem statement and nothing else.
Working with a single vendor has benefits that can’t be denied. But there are also bad things about working with a single vendor. You may be familiar with the saying, “Jack of all trades, master of none.”
It can feel like an all-in-one solution has tools for every job, like a Swiss Army knife, but none of them is suitable for the job. Especially when these all-in-one companies expand their breath via acquisitions instead of organic growth negating the perceived benefits of “seamless integrations.”
Even if they grew organically, the number of resources to support each feature could vary. One can expect more headcounts (and money) behind the cash cow product and perhaps just a team of one FTE and an intern to support a brand new feature to tick the checkbox.
So Which One is Better?
New technologies are now easier to integrate and produce the exceptional results you require. According to Josh Bersin’s HR tech research, knowledgeable Human Resources directors are increasingly focusing on having a higher number of the correct Human Resources systems and building quality integrations to deliver exceptional user experiences.
Bersin recommends that HR leaders focus on Best-of-breed to provide such experiences. Finally, he advises HR directors to build a tech stack that includes a robust core HR platform such as SAP SuccessFactors, Workday HCM and Oracle HCM to contain all your personnel data and extra technology solutions (from new vendors) to tackle each specific HR or business challenge.
4-Steps to Picking Your HR Tech
The HR Tech Workshop by Josh Bersin Academy
Many of us make decisions about HR technology the wrong way around. We start with technology and try to figure out how to use it to solve our problems instead of doing it the other way around. To choose the right tools for our business, we must consider what it needs. We need to know what problems we’re trying to solve for the business.
To do this, there needs to be a cross-functional effort, and key stakeholders need to be involved from the start. Rule of thumb: solve the business problem first, then look at the HR technology.
You’ve found the problems that need to be fixed in your business. Now, the other half of the equation is to understand your people, especially what they go through on a daily basis. People are what make an organisation work. In the end, people cause and solve all problems. The same is true of any technology we choose: its success or failure depends on how many people use it (or don’t use it) every day.
Before we can find tech-based solutions, we need a clear picture of what employees are going through, including what tools they’re already using, what pressures they’re under, what they need, and what kind of help they need.
Try instead of buy right now. Choose the solution you think will work best and set up a pilot project (or several pilots). Don’t just buy something and put it to use! Right now, pilots are very popular, and for good reason. Definitely, they let us test and tweak products before putting a lot of people, time, and money into them. But pilots also let us try out new things and make changes.
How could a tech solution help both our front-line service workers and our sales reps around the world? Would it be good for a service to connect our people who live in different places and speak different languages? Will a certain product solve the problems we’re having with user experience as we try to integrate HR into the workflow? Pilots can help us get clear answers to these questions and find new ones we haven’t thought of yet.
As you get closer to launching a new HR tech initiative, you’ll probably run into resistance or confusion from coworkers and maybe even crucial stakeholders. But what’s going on is a fear of change. There will always be people eager to use a new piece of technology and people who would rather be stuck in the eye with a needle than change how they do things daily. So, it’s essential to involve the right people from the beginning.
To make change management more accessible, you should expand your team and rely on stakeholders, which are people outside of HR whose work will be necessary for building, implementing, and rolling out the new technology.
Best-of-Breed HR Tech Recommendations
To help you jump-start your understanding of the best-of-breed options, here are some suggestions:
A conversational interface (that looks like an instant messenger chat window) that helps carry out essential processes using artificial intelligence and machine learning.
Mental Wellness Platforms
An online mental wellness platform for individuals and businesses. The app includes daily interactive coaching and planner, a life assessment tool, goal-setting features, a mood journal and a wide selection of courses and resources to promote and achieve healthier habits.
Travel and Expense Management Platforms
Using Travel and Expense Management platforms, you can easily create and customise your expense reimbursement policies according to the type of expenses your employees incur.
Employee Document Management
A cloud-native document management platform that provides enables the organising, integrating, and safeguarding of data and documents for employees.
Time and Attendance Platforms
Time and attendance systems digitise tracking when employees start and end their shifts. These systems offer mobile apps and remote clock-in options for a distributed or remote workforce. Time and attendance systems offer workforce reports and exports that provide data to your payroll system.
- Workforce Optimizer
Background Screening Platforms
The software enables employers to track the status of ongoing background checks and securely store the information of completed background checks.
Time Capture Platforms
Time capture software allows the ease of capturing timestamps when it comes to attendance.
Learning Content Library
A corporate learning library is a repository of on-demand content for corporate and individual learning and development. Online learning libraries can be internally created and curated, accessed by learners on external sites, or a blend of the two.
- Linkedin Learning
Employee Experience Platforms
A software platform that enables organisations to take complete control of the look, feel and interactions a person will have while using your systems – without actually replacing the underlying HCM application or ATS.
- Culture Amp
Rewards and Recognitions Platforms
A recognition platform aims to make lasting behavioural changes that unify your workforce while ensuring that each employee feels appreciated, included and valued.
Learning Experience Platforms
An AI-driven peer learning experience platform born out of a new approach to corporate learning platforms, addressing perceived shortcomings with learning management systems (LMS).
- Linkedin Learning
Career Mobility Platforms
A tool designed to make skill-building and career development easier on employees and organisations.
Digital Coaching Platforms
Uses AI to help managers spot individuals with potential. This allows them to plan strategic coaching programs that contribute to the goals of both the employee and the organisation.
Today’s business problems are more complicated, less organised, and different from anything we’ve seen before. This means HR must demand best-of-breed technology to stay in business. It should be well-designed, easy to integrate, solve complex problems and adapt to change quickly.
Therefore, HR directors should build a tech stack that includes a robust core HR platform (e.g. SAP SuccessFactors, Workday HCM, or Oracle HCM) to contain all of your personnel data and Add-ons (from niche HRTech best-of-the-breed vendors) to tackle each specific HR or business challenge.