An Ever-Changing Landscape

February 14, 2012

It has been a very active couple of weeks in the acquisition market for HR systems.  This has sparked many discussions and conjecture within the HR systems industry on how these acquisitions will effect the future of the HR systems market.  While much has been discussed, it is still too early to fully know the impact to the final look and feel of the product.  What appears is that the major ERP players are moving into Software as a Service (SaaS) and, as predicted, there will continue to be consolidation in the HR systems market.

Every time there is a major merger or acquisition announcement, I continue to get calls and emails from HR professionals asking about how these changes will impact their system.  Even if you are not a client of the acquired vendor, the acquisition can impact your currently used technology.  The acquisition could have a profound change in the direction of the specific genre of software or it could result in an entirely new product being developed which will scientifically change the way HR technology is used.  The one thing that is certain, the changes we have seen will continue to occur.

To better prepare yourself for changes in the market, it is very important you have a full understanding of the technology you are using and what are the plans to interconnect the technology.  If you have not created a HCM technology strategy, now is the time to consider the undertaking.  If you do have a strategy, you may want to revisit your original assumptions during the creation to assure that your plan is still viable.  I realize that undertaking such an exercise in a time of smaller staffs can be difficult, but the payback with a solid strategy can help avoid any costly mistakes.

When updating any strategy it is best to get input from system experts.  This can come from organizations such as IHRIM or from reliable consulting firms such as HRchitect.  The knowledge you can obtain from outside resources can eliminate hours of research for you.  When updating your plans to address changes in the HCM technology future, consider using outside resources.  You will save time and update your plan to include the impacts of the recent software mergers and acquisitions.

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Posted by jhinojos

HRchitect’s MarketMinute: Oracle Announces Acquisition of Taleo

February 13, 2012

Last week, Oracle, an enterprise application software vendor, announced the acquisition of Taleo, a cloud-based human capital management (HCM) solutions provider, for $1.9 billion and a little over five times the projected 2012 revenue for Taleo.  Members of HRchitect’s executive team – Matt Lafata, Rick Fletcher, Ron Hanscome, John Hinojos, Tom LaMarre and Alex Tellez – met to discuss the transaction, on the implications to the talent management marketplace, during the most recent Market Minute.  Audio from the discussion is available here.  Key takeaways are always posted to The Puzzling World of HRtechnology blog and appear below.

Initial reactions:

  • It makes sense long term to have Integrated Human Capital Management.
  • The continued consolidation and acquisition of best-of-breed vendors by the ERP’s may create a commoditization of talent management features in the industry.
  • We may see an opportunity cost of integration over innovation.  Internal thrashing and energy that would be spent on innovating each of the particular product suites may instead be spend on providing good integration paths between the Oracle core products and Taleo capabilities.
  • How will products that currently integrate to Taleo be affected?
  • What does the product roadmap look like?  Oracle has historically had a tightly controlled approach to talking about product releases until they are almost out the door.  It may be hard for customers to get a good understanding in advance of what the roadmaps look like and what the impact will be on their own organization’s strategy.
  • How will Fusion and the Fusion applications be reconciled with the deeper, in many respects, best-of-breed / talent management capabilities that Taleo brings to the table?
  • A year ago the industry was seeing the talent management vendors consolidating and moving toward the suite vendors going after the mid-sized core HR vendors to create a whole human capital suite.  Over the last couple of months, the ERP vendors who have a lot of cash, have been picking these players up, largely because acquisition is an easy way to add cloud / SaaS capabilities to their product offerings.

Should existing Taleo customers be concerned about the acquisition?

  • Clients who are not Oracle shops are already expressing concern.  However, Taleo’s integration tools are agnostic – they currently work well with a number of HR systems – so there will be limited impact there.
  • Don’t panic.  No immediate changes will happen to the Taleo product offering or support are expected.

With this move by Oracle, and SAP’s previous acquisition of SuccessFactors, what about Workday?

  • Workday has build out talent management (performance, career development, succession planning and compensation) and for a first or second-version offering, is really very strong and all delivered within the context of an integrated HCM application.  However, recruiting and learning are the two remaining outliers.  Workday has chosen not to build these out.  The question remains if they will go outside of their organic approach and acquire someone, or will they continue to partner in the delivery of recruiting and learning?  The next few months should prove important in them determining that strategy.

Final thoughts:

  • As with all acquisitions, intent or strategy around it is one thing, execution is an entirely different thing.  The success of this acquisition will depend on how well the strategies are thrashed out, and how well they are executed.
  • The HR technology marketplace continues to move and shake with mergers and acquisitions.  It is always wise to go into an evaluation of an HR system with eyes wide open and consider all of the decision drivers that are most important to your organization, before deciding on any vendor

Leave a Comment » | HCM, HR technology, Human Capital Management, Talent Acquisition, Talent Management | Tagged: , , , , , , | Permalink
Posted by Tiffany Appleby

The Challenge of Going Global

February 1, 2012

Global companies often struggle with the challenge of deploying technology solutions and process automation in regions that perceive the demanded changes as “corporate mandated” and specific to the location of the company’s corporate offices. How often do we hear the sentiment expressed that this is just another corporate initiative that has nothing to do with how we do business in the region? Consequently, many system initiatives fail miserably when the regions are asked to adopt it. Projected ROI is not realized, organizational ineffectiveness continues, and careers are adversely impacted – despite the well intentioned deployment.

Over the last several years I have had the opportunity to work with many world-leading companies that have deployed solutions throughout the various world regions – to local end user populations with very distinct processes, business cultures, and language requirements. In working with these companies one of the first thing we have done is assess the company culture to determine if the organization is truly ready to deploy a global system that will be adopted as envisioned. After all – “if you build it they will come” only works in the movies.

In response to this problem, countless books, articles and white papers have been written and an equally large amount of seminars and workshops delivered. So why not (I ask myself) a blog on lessons learned over my years working with companies that have ventured into the world of global system deployment? Lessons learned from working with executives, project team members and system end users – both at Corporate as well as in the regions. A blog that discusses how to create a more effective deployment atmosphere and culture during system definition and implementation and prepare the ground properly to ensure that the actual system deployment is positive and yields the desired response at the Corporate and Regional level.
So, from scheduling calls and engaging virtual teams, to walking the fine line between localizations and standardization; from ensuring representation and commitment at the regional level, to overcoming project stereotypes and misconceptions across the board; from defining deployment strategies and managing system rollout tasks – stay tuned. Practical tips and suggestions I have learned (sometimes through my own mistakes) over the past decade as I have worked with well intentioned, conscientious and highly motivated colleagues thrown into the deep end and asked to swim.

Leave a Comment » | HCM, HR technology, Human Capital Management, Uncategorized | Tagged: , | Permalink
Posted by bskimball

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