Are We Entering a New Generation of HR Software?

Aug 1, 2018 12:02:08 PM / by Mary Kaylor

Enterprise software industry analyst Brian Sommer covers the ERP, finance and HR sectors for Diginomica and other publications. Brian began his career began by re-writing a payroll/time-reporting system for a fast food chain and subsequently reworked, implemented, etc. numerous application software systems. He went on to run Accenture’s Global Software Intelligence organization where he advised hundreds of clients on software selection and shared services initiatives. Brian also headed up Accenture’s Global HR Center of Excellence and its Global Finance/Performance Management Center of Excellence. More recently, Brian has led several HR/ERP software selections/negotiations and had been an expert witness for major software litigation cases. Brian has won Software Advice’s Authority Award – ERP Expert and numerous ERP Writers' Awards. He has keynoted numerous software conferences globally including events for NetSuite, PeopleSoft, Sage and many more.


Q. Are we entering a new generation of HR software?

We’re clearly in a second generation of cloud HR software today. The first generation brought multi-tenancy, new technology platforms and rapid implementations of HCM software. HR leaders loved these solutions as vendors, not IT, provided needed upgrades and maintenance.  These solutions also gained popularity due to their improved access of HR data on tablets and smartphones.

Since then, vendors have been moving to new architectures and tools that make big data, powerful analytics and more come to life. As a result, these second generation HCM products are using AI, natural language processing, etc. to deliver insights and competitive advantage not just productivity or efficiency gains to users.

Q. What are some of the other advantages of moving to a second generation HR system?

Many of these solutions have superb user interfaces that work on most smartphones, tablets and computers. The ease of use of these newer solutions is such that training is minimized and more users, beyond HR staffers, can easily access data. This makes newer generation recruiting solutions more favorable to jobseekers.  Onboarding can now occur anywhere, anytime by most anyone. Employee self-service has exploded because of these new technologies. And, now AI-powered chatbots are offloading a lot of the tedious, repetitive tasks that used to sap the productivity of HR team members.

The big data behind these tools is also changing how HR processes work.  Big data enlarges potential applicant pools. Big data (and machine learning) allow for better team assignments.

Q. What are some of the most important questions an organization should ask before moving to second generation cloud HR systems?

One of the first questions is “What is our destination?” By this, HR leaders need to become aware of the myriad possibilities before them, select those most applicable for their firm and then define how many of their HR processes will be structured going forward.

Once that’s known, then some tough introspection is required. HR leaders may find their firm lacking in skills that these second generation solutions utilize. It does no good if you have an amazing state of the art vision but lack the quant, anomaly detection, AI, natural language processing and other skills needed to pull this transformation off.

One caution though: if your vision seems straightforward or incremental, then it’s probably not visionary enough.

Q. What data migration issues are most common when moving to these new HR systems?

The challenges here are different than in previous HR migrations. Why?  Second generation cloud HR products are dramatically expanding what we’ve come to know the data model to contain. As a result, newer solutions require data elements that many companies won’t have initially.

Additionally, some big data sources will contain unstructured data like chats, emails, texts, mapping information and photos.  Your migration team may be scanning images and acquiring archives of videos. This part of an implementation will be very different from all prior HR system conversions.

Q. What have you found to be the biggest pitfalls organizations should watch out for when acquiring second generation HR cloud solutions?

Not all vendors are moving to a second generation HR cloud solution at the same pace. That said, it won’t stop these vendors from giving the perception that they’ll be there any day now. Some vendors only have proof of concept technologies that are a long ways from being generally available.  Be careful in accepting vendor statements regarding technologies like artificial intelligence.  Verify the general availability and capabilities of these solutions before buying them.

Q.   It’s important to find a cloud vendor that will help an organization align its HR delivery with strategic goals and solve business challenges. What questions should HR ask vendors in the selection process?  

Smart firms find a balance in the kinds of things they ask vendors to show. Today, there’s little value in asking vendors to show you things that most HR systems solved decades ago. In fact, if you’re asking them to show you how to do something that you’ve been doing the last twenty years, then it’s probably out of date.

Get the vendors to demonstrate radically reimagined processes. For example, don’t ask to see how to do recruiting via job boards and want ads. Ask to see how they support recruiting via big data. See how they borrow CRM concepts to deliver recruitment marketing. But whatever you do, see some capabilities that stretch your thinking.

 Want to learn more?  Brian Sommer will present at the 2018 HR Technology Conference:  Moving Your HCM Technology to the Next-Generation HR Cloud  |  Wednesday, September 12, 2018: 11:00 AM - 12:00 PM

Topics: Cloud HR Software, hr tech, HR Technology, HR Tech Conference

Mary Kaylor

Written by Mary Kaylor

Mary Kaylor is the Public Affairs Lead for the Society for Human Resource Management. She is the Managing Editor of the SHRM Blog and the creator and producer of #Nextchat, a leading global Twitter chat on the HR trends and all things work. Her career in communications spans from technology and workforce management in the telecommunications industry to external affairs and public relations. An HR Technology conference blogger since 2015, you can find her on Twitter at @SHRMKaylor.

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