Posted by Josh Bersin on October 05, 2016.
The world of HR technology is about to go through one of its most disruptive times in decades. As I detail in the report “HR Technology Disruptions for 2017,” we are seeing a tremendous shift from a focus on core HR systems toward new systems that focus on “making work life better.”
Let me cite just a few examples, and you can read more in the report.
- While most big companies are now moving to a cloud-based HR system (almost 60 percent of companies have moved to the cloud), the markets for performance management, feedback, engagement, agile goal management, and wellness are all being disrupted. Dozens of fast-growing vendors have reinvented tools for check-ins, employee feedback, pulse surveys, and real-time analytics. While the ERP vendors are now rapidly winning business in core HR, these up-and-coming vendors are nibbling at the edges faster than ever.
- Tools for the measurement and diagnosis of culture are hotter than ever. There are more than 20 new vendors selling culture and engagement measurement tools, and companies are just now starting to understand how to diagnose their culture in a measurable way. (Deloitte CulturePath, a leader in this market, just won an award from Human Resource Executive magazine.)
- Native mobile HR apps are here. While most HR vendors started their business building web-based systems, companies are now looking for an easy-to-use, integrated mobile experience first. Just as the cloud disrupted vendors who had built their architectures around client-server, I believe “mobile-first” vendors can do the same to many incumbent providers.
- New tools for employee well-being are beginning to become strategic parts of the technology market. What good is it for you to set goals and collaborate when you’re too tired to work at all? These tools analyze your behavior and help you work healthier, live healthier, and even eat healthier.
- The talent management market continues to grow, and new cloud vendors focused on small businesses are on fire. Some of the fastest-growing companies in HR Technology sell to small businesses (the report lists them).
- The applicant tracking market is undergoing rapid change, as vendors that provide “recruitment success platforms” and AI-based video interviewing systems start to take over. Most of the large companies we talk with want to replace their ATS, and these new vendors are soon going to be able to meet their needs.
- The learning technology market is undergoing more disruption than I’ve seen in a decade. New learning experience platforms, mobile learning tools, micro-learning tools, and video production and distribution tools are now ready to scale. It’s time to seriously consider a migration plan from your legacy LMS.
- A new market for “employee experience platforms” has emerged—tools that sit between your core HR systems and your employees–offering mobile interfaces, AI and natural language processing, and integrated case management to give employees an easy to use, natural way to manage their life at work. (Deloitte ConnectMe is an emerging leader in this market.)
- The big ERP vendors (Oracle, SAP, Workday, Infor) and major payroll providers (ADP, Ceridian) are all adding advanced analytics, video learning, and more advanced tools to help employees manage their daily life. The days of HRM systems managing core HR are over: that functionality is now a “hygiene” feature. Companies now expect a whole set of life-cycle tools to help employees make their work more productive.
- The line between “HR software” and “work management software” is now going away. Most of the new HR systems look and feel like productivity apps, they integrate with Outlook, Gmail, and Slack, and they are designed to be “useful” not just “required.”
The good thing in all this is that HR technology is getting easier to use, more valuable to employees, and more flexible to implement. The bad news is that there is a flood of new tools available, forcing companies to look at lots of options again.
Please read the report, and I look forward to you joining me in our upcoming webinar (December 13, 2017, 2:00 p.m. ET) on HR technology disruptions and our predictions for 2017.