The key reason for this shift is a realization in HR departments, that technology can not only lead to better efficiency (time and cost) and better service delivery (mainly for transactional processes), but can also lead to better integration amongst the core HR processes and hence, the development of an integrated, technology enabled, talent management system. The fact that most important HR challenges have to do with enhancing employee productivity and capability and not only with more transactional efficiency, is encouraging this trend.
The earliest adopters of HR technology, simply automated (as is) their transaction intensive HR processes. Later, as the technology providers gained some expertise and realized the importance of scale and standardization, they tried to create some level of solution and platform standardization across clients. The process was resisted in some instances as clients wanted customized solutions. The current state is a hybrid technology model, where we have multiple platforms like ERP (SAP, PeopleSoft, and Oracle), point solutions for specific processes (for example, Success Factors) and proprietary platforms developed by large HR outsourcing firms (ADP, Hewitt). In addition to these, there are a host of proprietary HR tools developed by small enterprises in India.
In the future, one would have a larger proportion of configurable/off-the-shelf solutions involving multiple processes. There would be lesser customized solutions and more standardization.
We at Lava use SAP for payroll and benefits administration and as the employee database. We have engaged a midsized Indian IT company to configure a web-based IT enabled employee portal that has various HR processes. All employees and managers shall be able to log into the portal and use the portal in a self service mode. The intent is to link the portal to SAP at the back end.
We choose an IT vendor after seeing the capability of their tool, taking feedback from some of their clients and making an assessment of their capability to support us on an ongoing basis.