As many as 6 out of 10 respondents shared that their budget in HR technology is going to increase and 3 out of 10 will maintain them at the same level as this year
Rolled out in the months of June and July 2015, People Matters HR Technology Study 2015 brings data, facts and some answers about this fascinating industry that is poised to change the way organizations view the HR function. The Study saw a participation of 155 leaders from Indian companies, MNCs and small and medium sized companies, to identify the prevalence of HR technology in Indian businesses.
Though the advent of HR technology seems recent, it traces its roots back to the 1960s when computer-based HR applications were developed in order to deal with tedious clerical work. Further, the launch of web-based applications changed the functioning of HR systems. Majority of the organizations that we surveyed (63 per cent) mentioned that HR technology was put in place prior to 2010 in their respective organizations. However, it is mostly in the early to mid-2000s that companies began to heavily invest in technology, which led to a boom in the HR technology market and the emergence of Software-as-a-Service HR solutions.
While analyzing the findings of the Study, it was established that technology investments have been the highest in administration-related HR processes. Today, 85 per cent of companies have adopted technology for leave and attendance and 83 per cent for payroll. In the last few years, the investment in more strategic HR areas has followed, with 77 per cent respondents having a technology-enabled performance management system, 63 per cent and 59 per cent having automated some areas of hiring and L&D respectively. “While majority of the companies continue to invest in technology for HR administrative processes like payroll, leave and attendance, investments in strategic areas around productivity, recruitment, communication, learning & development etc. are also increasing,” says Rajesh Ranjan, Partner at Everest Group. The next layer of investments in technology has been learning and development (63 per cent), collaboration (33 per cent) and succession planning (25 per cent).
This year’s Study reveals that companies in India will continue to increase their investments in technology: As many as 6 out of 10 respondents shared that their budget in HR technology is going to increase and 3 out of 10 will maintain them at the same level as this year. The functions that will see the highest investment will be HR Analytics (72 per cent), Recruitment Technology (69 per cent), L&D Technology (69 per cent), and bringing mobility across the HR processes (65 per cent).
When asked about the goals that they had set for themselves and how their technology implementations have faired on them, respondents shared that HR technology has helped them bring transparency in their workflows (as many as 80 per cent feel that this objective is key and that has been achieved). The second main objective that technology implementation has helped them achieve is bringing operational efficiency in the HR delivery (again 80 per cent respondents have agreed). Use of automated web-based HR processes not only eliminates human error, but also makes it possible to transparently share and integrate data.
While the benefits of using technology is undoubtedly tangible, there are some obstacles that organizations need to tackle, chief among them being identification of the core business goals and organizational challenges for which technology is required. Secondly, CHROs have the opportunity to lead this transformation process and CHROs are taking ownership of the implementation of HR technology and driving business impact. Thirdly, leadership teams have to take a long-term view when it comes to measuring RoI on HR technology and be prepared to tackle the change that will take place once the systems are in place – the benefits will follow for those organizations that stick to their commitment until it yields its desired business results.