The Puzzling World of HR Technology

Here at HRchitect, we celebrated the opening of our new corporate office location this week with a ribbon cutting and open house.

The growth we have experienced over the previous few years, and especially over the past 18 months, dictated the need for expanded office space.  So, we moved right down the street to our new location, still within the Frisco Square development that we all enjoy working in.  The new office offers increased working space for our employees as well as increased conferencing space for meeting with clients, prospects and partners.

We look forward to hosting many more events in our new space!  Our doors are always open, so if you are in the Frisco area, come by and say hello.  Our new address is 6175 Main Street in Frisco.

This week, assessment giants SHL & PreVisor announced a merger between the companies and our HRchitect leadership team, Rick Fletcher, Ron Hanscome, and Matt Lafata  got together to discuss during the latest episode of the Market Minute.  What’s in store for the future of the newly merged companies and what implications will this merger have on the marketplace?  Here are key takeaways from the discussion:

• Together, SHL & PreVisor represent $200 million in revenues and deliver more than 15 million assessments annually in over 150 countries
  • Complementary overlap between the two firms – PreVisor has traditionally focused on plug and play assessments while SHL specializes in the global customer and more custom assessments
  • Largest major competitor of the newly merged companies is Kenexa who has a significant assessment practice that delivers around 15 million assessments in 14 languages in 44 countries.  The Kenexa system offers around 1000 assessment tests delivered via their ‘ProvieIt’ brand that can be plugged in to recruiting applications, as well as custom assessments that can be created for organizations in key job categories and industries
  • Through this merger of two of the Tier 1 assessment vendors, the door is opened somewhat for to Tier 2 players, as traditionally organizations look at at a minimum of three vendors during the evaluation process
• The road ahead for SHL & PreVisor -
  • Clients can expect some bumps in the road as overlapping banks of tests get evaluated and determination is made to which tests are retired and which will continue onward.  If you are a client that uses out of the box assessments, consider contacting account management to find out what is happening with your tests.  No impact should be felt by clients using custom assessments.
  • The addition of an applicant tracking system (or vendor) – As one of the top two assessment vendors in the space, HRchitect predicts that the new SHL/PreVisor will either add an applicant tracking system (through organic growth or acquisition) or forge a deep partnership with an existing applicant tracking vendor.  The latter is believed to be the most feasible of the options.  Partnership could include both an enterprise vendor and a vendor specializing in the mid-market sector.  While the assessments would still be usable by other vendors, a more deeper integration would exist between the partners, similar to what happens with Kenexa assessment today.
• Trends in assessment technology:
  • Organizations are spending more time using assessment technology to make sure they have the right people in place – in the early days, assessments were reserved for only the final candidates.  Recently, with the introduction of SaaS-based technology, more companies are requiring candidates to take online assessments earlier in the recruitment process.  The benefit of running these assessments sooner is a shorter time-to-contribution for new hires as the closer applicants can be screened to fit the desired competencies of specific job categories, the faster they can be brought up to speed.
  • Assessments are becoming more widely used post hire – the same assessment criteria used to hire the best candidates are being used in learning and performance management to assess performance gaps and recommend learning events and other activities to close the gaps.  These analyses are also being used in both career development and succession planning

To listen to the Market Minute in its entirety, use the link below, or download it to your iTunes by visiting http://blogtalkradio.com/HRchitect.

HRchitect Market Minute – Episode 2

Frisco, Texas – January 11, 2011 – HRchitect, the leader in HR systems strategic consulting and the premier Human Capital Management (HCM) and Talent Management systems consulting firm, announced today that Ron Hanscome has been named Vice President of the firm’s HCM Systems Strategy practice.

Ron Hanscome viewed as an industry expert on human capital management systems strategic planning, joined HRchitect in 2007 and has since served many different roles, most recently as a project-based Senior HCM consultant.  During a brief time away from HRchitect, Ron served as Vice President of Product Strategy at Kenexa, one of the industry’s leading Talent Management software vendors.

As Vice President of HCM Systems Strategy and a member of the executive team, Hanscome will lead a team of highly talented and experienced consultants in the highest growth practice at HRchitect.  Hanscome and his team will work with organizations to review their HR systems and processes and develop HCM strategic plans that describe the vision, goals and objectives for HR technology throughout the enterprise. Ron will also be responsible for publishing white papers, blogs and other insight around HCM systems strategic planning.

“HRchitect is seeing tremendous movement in the marketplace around HCM Systems Strategic Planning,” stated Matt Lafata, Vice President of Sales & Marketing for HRchitect.  “As the economy continues to rebound, organizations are again seeing the need to evaluate their current HR systems and develop updated roadmaps for what their HR technology infrastructure will need to look over the next 3-5 years.  Ron has the knowledge and insight to lead this team and help these companies design a tailored plan that meets their needs and their changing workforce.”

Hanscome has over 26 years of experience in the Human Capital Management software and consulting services industries, having served as a practitioner, consultant, software executive, and industry analyst.  He has provided leading-edge consulting services for numerous organizations including Barclays Global Investors, Mayo Clinic, Bank of Oklahoma, Texans Credit Union, Tishman-Speyer, Cenovus, Bain & Company, Accor North America, Human Rights Watch, VI, Dresser, and others.

”The HCM market continues to morph at a dizzying pace. Now more than ever, organizations of all shapes and sizes can gain a huge benefit from reviewing and updating their HR technology strategy on a regular basis. I’m pleased, excited and honored to lead HRchitect’s HCM Systems Strategy practice at this critical time. I look forward to working with the Executive team to build on this already successful practice in 2011 and beyond.”

Prior to joining HRchitect, Hanscome led Oracle’s HCM Applications Marketing team, serving as a thought leader and evangelist for Oracle’s HCM product lines. He was also Senior Program Director with META Group, an IT research and advisory firm, where he authored over forty pieces of industry shaping HCM research.  In addition, Hanscome worked as an HRMS practitioner with United Health Group and Medtronic, as a consultant with Watson Wyatt, and as a software vendor executive with Ceridian Employer Services and Lawson Software.

Today HRchitect launched our newest educational resource,
the Market Minute. The Market Minute delivers ‘the skinny’ on
breaking news in the world of HRtechnology in a quick, concise, and
informative roundtable discussion with HRchitect’s thought
leadership team. The topic for Episode 1 of Market Minute was the
announcement of SumTotal’s acquisition of GeoLearning.
Participating in the discussion were Rick Fletcher, President and
Founder, Matt Lafata, Vice President of Sales & Marketing
and Talent Management Systems Analyst, and Ron Hanscome, Vice
President of Strategic Consulting. Key takeaways from the
discussion -

• SumTotal formed in 2004 from two
  Learning Management systems – Doscent and Click-to-Learn, followed
  by their acquisition of Pathlore in 2005. From there, the
  series of acquisitions continued with Mindsolve in 2006
  (Performance, Succession Planning, Compensation) and Softscape in
  2010. SumTotal themselves were acquired by Vista Equity
  Partners in 2009 and were quiet for a time while they were doing
  some internal retooling as the organization was coming to grips
  with new owners and a new expectation for profitability. The
  Bersin & Associates 2011 Learning Management Solutions
  Guide indicated that SumTotal Systems was the market leader, with
  the largest global market share, in learning. With the
  acquisition of GeoLearning, SumTotal has enlarged its position with
  somewhat over $150 million of revenues with a majority of that in
  the Learning space and the remainder of that being Talent
  Management via Softscape.
• GeoLearning is a
  very strong leader in Learning Management solutions and pioneered
  SaaS based LMS. They report 700 customers and $40 million in
  revenue.
• The GeoLearning acquisition by
  SumTotal is interesting for many reasons:
  • SumTotal came out of the chute with guns blazing in late
    2010 and early 2011 with a series of acquisitions: Softscape to add
    Talent Management capabilities to the predominately learning
    management functionality of SumTotal, Mindsolve had nice
    capabilities around Performance Management and Compensation
    (clearly SumTotal gained traction with that and thus added
    Softscape for a more Integrated Talent Management approach), and
    added to that by taking in GeoLearning which was one of the early
    SaaS providers for LMS and focused on the mid-market. We see
    this as SumTotal’s play to: 1. add to their SaaS capabilities with
    a platform dedicated to that service and, 2. add an already defined
    mid-market solution that has been rated very high in customer
    satisfaction over the last few years.
  • Removes
    GeoLearning from the market: GeoLearning was a partner of
    SuccessFactors, who do not have an LMS component, but most other
    capabilities around ITM. We have heard rumors and rumblings
    about SuccessFactors making their own investments in a LMS, but
    those have not yet come to fruition. This had led us to
    expect that with the rapid succession of LMS acquisitions of LMS
    (Taleo’s acquisition of Learn.com and SumTotal picking up Softscape
    which does offer some Learning), SuccessFactors would have been the
    logical candidate to add to their components with a Learning
    solution
  • A Recruitment or Applicant Tracking
    vendor would have been a natural acquisition for SumTotal.
    There has been a tremendous scramble to acquire Recruitment or
    Learning as of late. With SumTotal collectively having 4-5
    LMS’s, does GeoLearning really provide any additional features or
    functionality? It does buy SumTotal a greater understanding
    of SaaS-based technology. Over time, we believe SumTotal will
    shift their clients to the SaaS based application found in
    GeoLearning and that it signals a recognition that their own
    efforts to transition their on-premise solutions around Doscent,
    Click-to-Learn, and their SumTotal 10 platform just hasn’t been
    penetrating and they haven’t been able to move their large, complex
    clients to a SaaS-based platform. They are recognizing they
    they need to have a different solution for that and one that would
    be more focused on the mid-market for quicker, more profitable
    installs.
  • SuccessFactors – are they building
    their own LMS or will they go after someone else? There are
    30+ smaller, private players left, but few have the visibility of
    GeoLearning: Plateau continues to forge ahead with their own
    Integrated Talent Management plans and Cornerstone OnDemand who has
    announced their own IPO and has been adding very robustly to its
    ITM portfolio and started from a learning base. From there,
    you move to the second tier, less visible players. As far as
    organic growth, SuccessFactors could come out with an organically
    grown LMS. Their ATS gained more traction than originally
    predicted, serving a couple hundred clients, and we believe they
    will come to the market preaching the benefits of an organically
    grown LMS.

To listen
to the discussion in it’s entirety, use the link below, or download
it to your iTunes by visiting http://blogtalkradio.com/HRchitect
Market
Minute Episode 1 HRchitect – Helping you solve the
Puzzling World of HRtechnology.