As the nature of work changes and forward-thinking businesses harness the power of human-centred AI, HR professionals are presented with a vast amount of data and an increasingly varied talent pool.
But with so many HR software options out there, it’s hard to know which provider to pick. By keeping abreast of the latest trends in the HR software market, HR leaders can make an informed choice and give their business a competitive edge.
In this blog we will look at the different HR tech options on the market — and how businesses can use them to their advantage.
In the fragmented HR tech market, growing demand for cloud-based human capital management software has caused the number of vendors to skyrocket. So much so, in fact, that the market is likely to be worth $22.5bn (£17.4bn) in three years’ time.
And with barriers to entry in the market being lower than ever, businesses have the opportunity to stay relevant amid the data revolution — regardless of sector, budget or level of technical expertise.
Despite exponential growth in the sector, global market research firm AMR see a struggle emerging between holistic solutions provided by tech giants such as Sage, Oracle and ADP and the options provided by smaller, niche HR software suppliers. Choosing between a holistic and a niche provider can be a difficult decision, and it’s one that clients are keen to get right.
For ADP, the introduction of their iCHM2 product — billed as a “complete human capital management system in the cloud” — is a testament to the superiority of the holistic approach.
At the opposite end of the HR technology spectrum, niche providers like Breathe HR argue that businesses need to be actively supported by tech rather than being buried in it. As an alternative to the holistic consultancy products aimed at large firms and corporations, Breathe HR’s USP is to provide a user-friendly, jargon-free approach that more closely aligns with the needs of small businesses.
Though these contrasting approaches to HR tech appear to signal a future in which businesses are spoilt for choice, David Hargrave, director of Willis Towers Watson, says this is unlikely.
Instead, he envisages the emergence of a “platform-based market” — one which “allows you access to a competitive marketplace for each different tool on that platform as soon as you subscribe.” This means that businesses will be able to choose from a number of different sources for specific data points.
For some, these developments represent a major shift towards an “ecosystem” of HR tech products that is loosely analogous with Apple’s App Store. The risk of such a situation — reliance on a single procurement provider while innovation and disruption are driving the market — is counterbalanced by fears that small suppliers may start replicating in-house systems (and then each other). Neither outcome would prove beneficial to anyone.
However, there are suggestions that smaller, niche products are collaborating with other players to take on the HR tech giants. Were such a collaboration to take off, this would allay fears that too many suppliers will over-saturate the market. As Kate Cooper, head of research at the Institute of Leadership and Management, says:
“The notion of small, specialist tech firms banding together to rival the big platforms is a very good example of how people can make tech work for themselves, rather than the other way around.”
In this view, HR leaders — who are required to be constantly agile and flexible in their approach — should not view technology as a threat. Instead, they should see it as a way to stay ahead of the curve when it comes to people matters.
For Cooper, businesses should take advantage of the disruptors and tap firmly into their research and development. Harnessing the potential of AI empowers HR professionals to approach the hiring process in a more efficient, mutually beneficial way.
The future of talent management
The article above is based on an exclusive Raconteur report published by The Times. The report featured expert contributors from the world of HR, tech and talent management - including Guidant Global’s CEO Simon Blockley - and explores what the future holds for the talent management sector.
Complete the form below to get full access to the Raconteur report and learn more about the HR tech market as part of the future of talent management.