People Matters undertook the HR Technology Study in 2015 reaching to over 150 companies to understand the state of affairs of digitization and automation of HR process across the employee lifecycle. Here are some of the key findings of the last year study and what it means for you in your journey of digitizing and automating HR not only for HR efficiency but also for HR effectiveness and business impact.
Is your HR tech relevant today? 72% of MNCs and 74% of Indian multinational implemented their HRMS systems prior to 2010. With the rapid changes in the technology landscape, it is predicted that every 2 years half of the technology you have may have become obsolete. Make sure you look at the technology you have, question how relevant and current it is for your business needs.
Is your HR tech looking for efficiency or effectiveness? The areas that are mostly digitized are HR operation process, like leave and attendance (85%), Payroll (83%), HR reporting (77%) - while this is good news as HR becomes more efficient and its processes and creates excellence in the function, business wants to see effectiveness in terms of business outcomes. So look at investment in technology beyond HR efficiency.
Next wave of investments - moving the value chain of business impact: When we asked respondents to tell us where their investments will go next year, here is what they told us:
- More investment in core processes that are business critical (45% will increase their investment in leveraging tech for onboarding and 33% for communication);
- More investment in digitizing verticals of HR (63% of participants said they will increase their investments in hiring technology and 59% in L&D);
- More investment in HR Analytics with 72% respondents investing heavily in building tech capabilities for predictability.
Who decides on HR tech? While CHROs and HR vertical leaders are the main influencers (about 70% of respondents said they are the prime influencers), the decision to go ahead is still taken among CEOs, CHROs, and CFOs, having said that, in our conversations with business leaders we are seeing a change in this trend. More and more CHROs are taking accountability of HR tech investments.
How satisfied are we with our current tech adoption? Only 19% of respondents rated their technology implementation as "very successful" - Challenges mentioned by participants of the study on why it was not so successful are:
- Budget constraints (54%);
- Multiple stakeholders involved (56% said that was the primary challenge;
- Resistance to change (42%)
The underlying challenge is really about linking your HR Tech strategy to business objectives and core values of the organization and creating a holistic change management that prevents all these challenges and proactively plans for its solutions (to the extent possible). From our interactions with business and HR leaders, we’ve learned that despite the dynamism, there are many business problems that can be solved today. And contrary to the traditional adage "It is a marathon, not a sprint" when it comes to HR tech strategy, we would argue that "It is a marathon AND a sprint". \
This year, yet again we embarked on benchmarking HR technology trends in India in partnership with SAP. For the exclusive findings for the “2016 HR Technology Study” results be sure to check out our August cover in which we document some of the digital agendas of some of the leading companies across diverse sectors, we study the state of HR technology in India and also let experts weigh-in on what the future holds!