HR Technology Conference 2014: HCM Roundtable

Every year we’re trying to figure out what’s next.  7 years ago, I started hearing about social HR everywhere, but the market really wasn’t ready.  Every HR organization thought that social was a bad idea, with personal privacy challenges looming to kill any social enterprise initiatives.  2 years ago, we all took for granted that social was going to be a part of our businesses, and this year it really seemed like social finally became its own and is permeating many of our HR processes and technologies.  It lonely took 7 years after the vendors and advisor market predicted it for it to become reality.  (LOL)

During this year’s HR Technology  Conference HCM roundtable, it was fascinating to hear what everyone was working on (it was the first question posed to the group, and I’m not trying to bash any vendor, but I am representing my opinion of the answers).

  • What was fascinating was that 2 of the vendors were talking about a great user experience (Oracle Fusion and Ultimate).  Wait a second.  We’re still talking about UX?  How did these 2 vendors get a seat at this panel and only have UX to offer up for what’s new in the product.  It’s unfortunate.  Y’all gotta do better than that.
  • 2 of the vendors talked about machine learning.  (ADP and Workday).  Machine learning was part of an overall theme of the conference, and there was a follow-up conversation in this panel about it, but these 2 vendors were the ones who brought it up as a focus area in their opening comments.  When I think about social HR 7 years ago, I think that machine learning is what the next few years might be about and it seems like 2 vendors want us to know that they’re on top of it.  What is surprising here is who the vendors were – and it shows us that there can be surprises.  It wasn’t Oracle and SAP with their deep (and legacy) analytics engines and mountains of programmers.  It was ADP (wh-wh-wh-what?!?!  I LOVE that ADP is thinking about this as they have the largest client/employee base to run analytics off of.  Maybe I don’t give them enough credit.) and Workday (ok, maybe predictable since they seem to be thinking/innovating faster than the others).
  • Last up was SAP.  Can anyone say “extensibility?”  Actually, SAP was gearing up to talk about some really cool metadata and object architecture that will create extensibility, but they got cut off from a time perspective.  Leave it to SAP to make things more complex, but if we can get to configurable extensibility, that’s pretty cool.  Honestly, I would have expected Oracle to be on the extensibility bandwagon based on their application architecture.

I’m hard pressed to say whether machine learning or extensibility is what’s next, but I’d think that all the vendors should be working on both of them.  UX is table stakes, and you should not be allowed to talk at the table (or panel as it was) if that’s what you’re working on.  My guess is that SAP will have some chops in the machine learning space, but it just was not what they wanted to focus on.  It’s also interesting that ADP and Workday were not on the extensibility front as it’s clearly a focus area for the very large customers that SAP has as its client base (but maybe that’s why SAP is so focused).

In a few vendor comments unrelated to the HCM roundtable, the HCM vendor space is going to start reaching parity in the next year.  Oracle and SAP are picking up steam and finally starting to look competitive.  First of all, lets agree that I HCM software in vendor demo booths while I was at the conference.  The following is an aggregation of vendor demos and conversations I had with conference participants.  Here are a couple of comments around gaps or deficiencies that I’m still watching out for based on those conversations:  (alpha order)

  • ADP:  I was really quite pleased to see their new UX.  I can’t remember what it’s called, but they’ll be rolling it out to all of their products so that no matter what you’re on, you’ll have a similar experience.  My concern is really still around the back end.  ADP’s ability to stitch together a common front end on top of multiple back end (and still mainframe?) systems is pretty good, and perhaps when you’re outsourcing everything but the core HCM to a best in class payroll and benefits vendor, it might not matter what the back end looks like.  Maybe.
  • Oracle:  The main question is in the UX.  It’s simply not seamless, and it goes to the point of why they were focused on UX in the panel. It’s way better than the last couple of years, but one goes from the cool “mobile apply” look and feel into a slightly different transaction screen, into a completely non-appy environment in just a few clicks.  The first couple pages are well executed, but it just feels like they didn’t finish the job as you continue through a manager transaction.  The second question is in their customer base for sold Fusion Core HCM.  As I talked to conference participants, they were getting numbers from the Oracle booth anywhere between 400 to 600 (note to Oracle, please get your story straight).  There are still a lot of conference participants wondering why Oracle is giving Fusion HCM licenses away for free if they have market demand in the 100’s of customers.  It’s just not adding up, and nobody I talked to could figure out the story.
  • SAP:  I’m pretty sure that SAP is on its way to filling a few gaps.  Certainly per the above comments, if they are working to fill extensibility gaps that its large enterprise clients will need, they are also going to figure out benefits administration, timekeeping and payroll.  I talked to one conference participant who was told that benefits administration will be available to demo this quarter, and another who said they were told it would be in Q4 of 2015.  Either way it’s coming and that’s good news.  I think SAP’s original philosophy that payroll, time and benefits get outsourced, but for the top 250 clients in size, that’s a hard position to maintain.  (I don’t consider SAP cloud payroll to be comparable to Employee Central in architecture, agile configurability, or usability, so that’s why I harp on it.  I know that SAP would disagree).
  • Workday:  Everyone has been uber positive about Workday for years.  The questions among conference participants seemed to be around the viability of their recruiting module.  Granted this is their newest module, and the top vendors seem to have the capability to innovate rapidly over a couple release cycles.  Just as I’m confident SAP is going to figure out benefits quickly, same goes for Workday recruiting.

Having said all of this, I’m actually quite pleased with the vendor space.  The last couple of years (no matter what Oracle and SAP say) have been relatively uncompetitive.  There has been one clear winner in the market, and the fact that I don’t have to say who it was is a good indicator that it’s true. I think 2015 will get a bit more competitive, but 2016 will become an all out war.  This post is definitely “negative” about what my concerns might be, but what I don’t mention is the huge progress that all of the vendors have made and the very long lists of things they have done well and right.  I’m going to get in trouble from the vendors over this post anyway, but either way, I think 2015 is going to be interesting.  More viable vendors is always a good thing.

(Last comment.  I thought long and hard whether to post this.  Some vendor somewhere is going to be pissed at me, but at the end of the day, there were only 5 HCM vendors on stage, so any exclusion is not mine.  Also, each vendor chose to talk about what they talked about.  Perhaps they didn’t have enough time, but again, if Oracle really wanted to talk analytics but didn’t get to it, that’s not my fault.  Each vendor decided what they wanted to focus on by themselves.  The opinions in the latter half of this post are based on talking to other conference participants and seeing each of the vendors demo at their booth.  Posting this also saves me the effort of writing a year end post.)

Is Cloud The Way To Go?

So I had to upgrade my cell phone contract.  I used to be on this thing where I had a bucket of minutes and text messages to use, and now I’m on exactly the opposite.  I have unlimited phone and text and about 10 GB of data I can use every month.  It really points to a shift in how we as users of wireless devices are working.  Less and less of our days are spent actually talking to each other, and more of our days are spent collaborating through various mechanisms that involve data.  I will admit to spending an exceptional amount of time browsing news on my phone, looking through facebook updates to keep tabs on people, and using my phone for work emails.  Nobody calls me anymore, and if they do, I get my voicemails through data (I read my VM, have not listened to one in years).

One of the big questions these days is about SaaS and Cloud.  Should we do it?  Should we stay on PeopleSoft or SAP HCM?

The answer for SaaS is a definitive Yes.

At some point, be it this year, next or in 5 years, you are going to move to the cloud.  I’m not an opinion about your current on-premise strategy, and I’m not making a judgment of you if you disagree.  I’m simply stating a fact.  Let’s tale a look at the facts:

  • ADP: The actual development of the Enterprise HRMS client server product is probably severely limited.  I don’t even know if they sell it anymore.  We do know that ADP Vantage is what they are selling and developing.
  • Oracle / PeopleSoft:  We’ve all heard about applications unlimited, but for those who thing that in 2020 we’ll still be going to a PeopleSoft Track at OpenWorld, I think you really have to evaluate your reality.  The developers are all on Fusion.  Let’s say you are right and there is still a PeopleSoft product in 2020.  How long do you think it will have been since your last major product enhancement?
  • SAP: Well, there’s HAHA, and there’s SuccessFactors.  Either way, SAP kind of knows that they are pouring development resources into the cloud.  Same conclusion as with PeopleSoft – it will be around for a while, but that’s not the whole reality.
  • Workday:  It’s already in the cloud from the start – no discussion here.
  • Talent Management: It does not really matter if you bought Taleo, SuccessFactors, Cornerstone, PeopleFluent, (I’m going to get in trouble for leaving out 50 companies), you bought into the cloud long ago for TM.

I’m not really trying to change your mind on the cloud here.  It really does not matter.  If you are an HR technology buyer, you simply don’t have a choice.  The vendors and the industry are in the midst of choosing for you.  In just a few short years, all of your premise based HR technologies are going to cease or significantly slow their development efforts and fully shift to the cloud.  If you want to be on a product that will be continuously developed, that is where it will be.

Just in the same way I really don’t have a choice to stay on my old cell phone plan, the world is moving on when it comes to HR applications.  It’s time to move with it.

Leveling the Playing Field

I’ve always wondered about the benefits of doping in professional sports.  Once, I read about a journalist who decided to dope just to find out if it really was that dramatic at providing performance increases, and not only was he stronger, have significantly more endurance, but he also seemed to start reverse aging (age spots on his skin started to disappear).  Indeed, the reported benefits of doping are staggering.  Even an average guy like me could probably ride my bike over 100 miles a day for days in a row without real problems.

Lance Armstrong is once again in the news for doping.  Many of us have been pretty sure that he’s been a doper all along, but the man “has never failed a drug test” so we just let it go.  For the particular drugs we’re talking about, there is no real way to test if the drug is in someone’s system.  Instead, they test for other indicators.  In the case of EPO, they test for a blood hemocrit level above 5.0 (whatever that means).  Basically, if you tested every professional racer, there is a good chance that 90% of them have hemocrit levels at 4.8 or 4.9.  Their argument is that they are not cheating, even though they are cheating, just doing it below the level that they would get called out for it.  Instead, they argue that they are just keeping themselves level with the rest of the playing field.

A few years ago I’m sure I argued that core HR was dead, and talent management was dying with nothing to take their places.  Let’s face it – core HR functionality has not changed in a decade and Talent has been a bit of a bust because all we’ve done is automated the old crappy stuff.  Today, I’m not going to argue that HR technology is dead.  I’m going to argue that the playing field is now level.  Now I want to see who is going to perform, and who is going to get left behind.

If we look around the HR marketplace, there is really good reason to be excited.  I’m not talking about new functionality in core or talent, but I’m talking about how everyone is creating new user experience, and doing it in different ways.  If we look at Fusion versus Workday versus SAP/SF Employee Central versus ADP Vantage versus (all the vendors who are pissed they got left off al already too long list), the theory and design of the experience is totally different.  What we assume about our company’s employees and managers will drive a selection, not what functionality works for us.

We are no longer in the era of “do I want PeopleSoft position management, or SAP’s?”  I actually get to make a decision that is based on my culture and how I think they will best use the application.  Do I have a bunch of engineers, or do I have a bunch of management consultants?  Do I have machinists or perhaps finance guys?  I’m finally at the point where customers and culture are the things that are important.  I finally get to make decisions based on company strategy, workforce and culture.

Functionality is dead because it is a level playing field – but HR technology is one of the most exciting places to be in a really long time.

 

Switching Gears

A long time ago, I used to work for ADP doing pre-sales.  We had great relationships internally with services and implementation, but nonetheless it always seemed to come up that we didn’t always sell with the full lens of reality.  On the other hand, I’d say that we came up with some pretty cool solutions to some pretty tough problems.  In today’s world, I’m generally thought of as a strategist.  I do lots of planning type of work whether it’s strategic 3 year plans, some implementation planning, or just some business case writing.  My current project (depending on when this posts), is a global implementation of a new core HR system for which I had a major hand in writing the business case.  I’ll start by saying that I’m really not suited for implementations, but the experience is quite eye opening.

There is no blame for anything that happens in pre-sales here.  For this current project, we had probably one of the best consultants available both from functional and technical resources.  The problem that happens in pre-sales is that you don’t actually have finalized design yet, so all discussions are really quite hypothetical.  “So how would the application perform ABC?”  “Well, there is option 1, or 2, or 3.”  And of course if we wanted to solve for problem XYZ, there are solutions 7, 8, and 9.  Where the hard part comes in is that while all of the presented solutions are not only possible, but implementationally viable, mixing and matching does not always work.  Solution 2 might be dependent on implementing position management, and solution 3 might not work with solution 7.

When I was with ADP, there was sometimes the thinking that we threw things over the fence.  First of all, I think this happens with all vendors.  Second, I don’t think we ever really threw things over that proverbial fence.  Instead, we just didn’t know what a client was ultimately going to do, so we presented all the possible options.  In a sales cycle, you really don’t have the time to go into every nuance of every solution, and most of the time you have consultants like me driving tight timelines and moving discussions forward before “analysis paralysis” occurs.

I remember back in the day when ERP implementations would last for years – things would come up, we’d switch directions, something else would come up, we’d backtrack because the application didn’t work the way we expected it to.  Reflecting on my own experience, I realize how much we could not have known in the sales cycle, and what that meant for the implementation.  Implementation consultants have a really challenging job.  “But you guys told us we could do option 3!”  “Ok client, but you didn’t tell us that you wanted 1 job code for the entire company.”  (I’m kidding about that one)

Once we have requirements and design, I have a whole new respect for how implementers get around to explaining how the whole application actually works with all the nuances of each functional component.  I’ve always loved how sales consultants can dance around solutions for a system that if completely fictitious at that point, but am equally amazed at watching implementers dance around requirements once they start to solidify.  Hats off.

 

Fusion HCM Website is Up

Just an FYI since this appears to be about the softest launch we’ve seen in ages.  Considering we’ve been waiting for Fusion for a while.  Here’s an FYI that the website is up and perhaps the software is in GA (but you’ll have to ask Oracle to confirm that)

http://www.oracle.com/us/products/applications/fusion/hcm/index.html

Back to Basics

It seems to me that there has been a renewed focus on core HR.  Now I need to tell the truth, I really thought core HR was dead.  I mean, it will always be around, but with the whole industry moving on to cooler things like analytics and talent management, who cares about core HR anyway?  Seriously, core HR is core HR, how many ways can you present an employee transfer or termination process?  How many different vendors can effectively pitch OSHA functionality and expect to win?  Within reason, all the core HR vendors are pretty much on an equal playing field, for one reason or another that I won’t bother going into.

So the industry if focused on talent and analytics.  The problem is that nothing seems to work if you messed up core HR.  People deployed a nice, automated performance process 3 years ago, and they got themselves away from paper.  But at the same time, the industry told them that they didn’t get where they needed to go, and a number of reasons went into this.  First, deploying a talent process just wasn’t enough, and the vendors are madly working on the next level of functionality that will actually help us manage talent as opposed to automating a process.  Secondly however, talent management did not work the first time because we implemented it assuming our core HR systems were already healthy, and they were not.

First, Job.  There seems to be a renewed effort around job these days.  I think we’ve realized that even with all the focus on competencies as a foundational building block of talent, job is still the foundational building block of HR.  Without job, nothing else seems to work.  The problem was that we’ve been neglecting job for eons.  Ok, so that’s a stretch, but it’s certainly not uncommon for many of our organizations to have 5 times as many jobs as we need.  They are not standardized, they are redundant, and they have mismatched naming conventions.  They appear differently from country to country and business unit to business unit.  At the end of the day, a corporate organization can’t make any sense our of our jobs.  So we’ve gone back over the last few years and tried to start tightening up our job tables, which will in turn enable tighter competencies, performance, recruiting, succession, etc…  Not to mention that your analytics are worthless if you can’t use Job as one of your core dimensions in your datamarts.

Second, Organization.  We don’t often think about how we think about org.  Is it a financial hierarchy? Operational? HR? People manager?  When we first implemented organization in core HR years ago, we may have tied it tightly to the payroll engine, and cost centers were the priority at the sacrifice of supervisor chains.  Or we decided that an operaitonal structure made better sense and we sacrificed how HR generalists needed to interact with employees in the structure.  Whatever the tradeoff we made, we didn’t realize that a couple years later, this thing called talent management was going to assume that core HR could provide a clean structure to talent.  I’ve been to organizations where the performance, compensation, succession, and hiring managers were all different.  Who the hell was going to think of that 5 years ago?  huh?  The point is, that we’ve needed to go back to core HR and make some sense of our initial implementations.  And oh yeah, if you’re org is not clean enough to be a dimension in your datamarts – worthless again.

So the moral of the story is this:  if you’re late the the game and just getting to talent now, learn from those before you – fix core HR.  If you are not late to the game, but have not fixed core HR, go do it now.

HR Technology Deployments

I love it when consultants come in and talk to you about all the things you need to do around an implementation.  Obviously your implementer is going to do all the normal things around table configuration and testing, but they often miss some of the bigger items.  When consultants come in to talk about the other stuff, they are usually not particularly comprehensive – they like to talk about change management.  Change management is a wonderful thing, but it still does not mean you’re going to have a successful deployment, no matter how good the change program is.  There are so many things that go into swapping your HR technologies out that missing any of them could spell disaster.

  • Foundation.  I don’t know why so little time is spent on the foundation of any HR system.  Whether it’s core HR or talent management, there are some pretty big foundation issues that you should be looking at before you even think about starting an implementation.  Whether you like it or not, half of your problem with your prior system was not the system.  Half of your problem was that you screwed up the foundation, and had you gotten it right, you’d never be moving to a new system anyway.  Either you messed up the organizational structure and after that it was all downhill, or your jobs never made sense, or your security was horrible and ultimately your own poor security decisions ended up in horrific data quality.  Perhaps you didn’t really think through competencies or goals well enough when you did your first talent management implementation because the talent market was so young that nobody really knew what they were doing.  Either way, fix it now before you configure tables, because your implementer really just wants to get values in the table and stay on time – not help you figure out what the right org structure is for the next 10 years.
  • Decommissioning.  Ok, there are easy parts and hard parts.  The easy parts are reports, interfaces and data conversion.  Heck, that’s just part of any old implementation.  Of course we’re going to convert those.  But wait, did you say we’re not converting history?  How long are we going to have to access the old system for?  Does that mean we’re running reports out of 2 systems?  Wait, have we done analysis around the downstream systems and not just creating interfaces?  Listen, if you’re changing the org structure (see #1 above), you had better prepare every singe downstream system (and downstream from the downstream system) to get ready for new values or structures.  It’s not just about an interface or a report.  What you are doing is going to have far reaching impact – especially if it’s core HR.  Last thing you need to do is mess up some random headcount report that goes to the board of directors just because it comes out of a system 2 interfaces removed from core HR.
  • Implementation.  This is obviously one of the things that will get covered.  Your chosen implementer is going to be all over table configuration, and they are motivated to be on time and under budget.  That’s really where the problems comes in – you want them to be on time and under budget, but you’d also like to think that they are going to be strategically minded and help you out with other things above.  90% of the time they are not.  The cost model that your purchasing people drove them to simply won’t allow them to help you out, and even if thoy could, do you really want a group of people operating in the weeds of table configuration to also operate at the highest strategy levels?  Usually not.
  • Change Management.  Can we please get away from thinking that training and communication is all there is to change management?  Realistically, the estimate you should be using for change management should be about 20% of the implementation budget.  That’s right, if you are spending $1M on implementation, you should have a $200k budget.  When things start to get tight, the first things to go are any real hopes for change management.  If you don’t get your audience analysis and change strategy right, all you’re going to have are vendor provided training and generic communications.  Listen people, the new technology is 80% adoption and 20% everything else in the equation of success.  If you want to be successful, don’t cut the 20% of change management budgets, cut $200k out of your implementation and live without a piece of functionality.

Sorry – am I ranting?  It’s not just implementation, table configuration and change management.  You can get all of those perfect and still have a bad outcome.  In order to get it right, you have to do all of the activities, including the ones that are not totally obvious at first, and including the ones that your consultants are not trying to sell to you.

Evaluating the Demo

I’ll admit that a while back (wow – are we going on 10 years now?) I was an SC.  You know – those guys from the vendors that the salespeople count on to demonstrate product during the sales cycle.  SC’s are a highly valued commodity.  They are highly trained product experts that must float between the functional world that many of the HR practitioners in their audience live in, the technical world that many IT people in their audience live in, and the sales world that they are part of.  I mean seriously, how many people do you know that can have a functional, technical and sales conversation all at the same time?  The best SC’s are truly rare, have extraordinarily hard jobs, and in my humble opinion are actually quite underpaid for what they bring to the table.

I was attending the HR Demo show in December (put on by the one and only John Sumser) and it was really quite interesting watching back to back to back demos.  It was even more intriguing to listen to the commentary and watch the twitter feeds at the show.  Personally, I watched 3 demos (I was only there for the first day).  Not in any order, there was a horrific demo of a terrific product.  There was also a middling demo of a middling product, and a terrific demo of a fairly poor product.  However, I’m not sure that the verbal or twitter commentary really reflected this.  Part of this is the varying degrees of capability in driving through to what the core product capabilities are from either a functional or technological perspective, and reading past the SC’s ability to sell (that is after all what they are there for).  Let’s face it, a 1-hour demo of a product is designed and probably scripted to show all the best that a product has to offer.  The best SC’s are going to show all the flash in a way that looks incredibly simple.  Even if the product is absolute crap (I’m not saying I saw anything that was), the sales job is to convince you that you can do everything you need to do within the product and that the capabilities are not only sufficient, but that you love them.

At the same time, the technologists in the room are looking around at the exact same demo and not listening to a word about functionality.  Instead, they are watching the screens, table driven values, background integration, web architecture and all sorts of other things that are not being explained verbally.  Thus, I can watch an incredibly dry presentation but still come out of it saying, “wow, that was cool” while the functionally driven people in the room might be saying, “wow, that sucked.”  Functionally, if we are talking about core HR, I’m going to say that the product capabilities of the best demo and the worst demo were within 5% of each other.  However, technologists and functionally driven practitioners are going to come out of a demo with different perspectives.  Unless you are an analyst or have a specific background, I’m not sure that you’re going to be able to pull together these perspectives in a single individual.  That’s why, even though some HR people get a bit tight, we invite very broad teams of HR, IT, Finance, etc to watch demos.

As a parting thought, here are a couple of hints when you ask questions during the demo:

  • When the SC says, “Our clients handle that situation by using this functionality over here” means that it’s a workaround.  No matter how good and convincing the demo was, it’s a workaround and does not really exist.  You should also be aware that many of the workarounds that SC’s come up with are totally legitimate, but that the implementation groups may not be aware how to implement them.
  • When an SC says, “We suggest that you handle the situation this way” means there is a band aid.  You might be exiting the application, or using a workaround, but be in no doubt that once again the functionality does not exist.

Core HR is not a Hub

I came across this quite a few years ago as we started to tinker around with core HR systems needing to integrate with more systems than just payroll and benefits, and as analytics engines started to take off en masse.  Back in the first part of the millenium as talent applications started to get a serious look from the industry, the idea was that core HR applications could be the system of record for everything.  While some philosophical disputes existed back then (and continue to be pervasive), I think we fairly successfully resolved that core HR should not be the system of record for everything.

The easy stuff is around transactional systems.  We would never assume that core HR would be the system of record for things like employee taxes or benefit deductions.  It’s unlikely (assuming point solutions) that you’d want anything but the talent systems to be the master of performance and scores since the transactions take place outside of core HR.  We’ve pretty much determined that the core transactional system is going to be the system of record for almost all data elements, and I think this is a good thing.

The problem is that early in the day, we had it easy from an integration standpoint.  We really didn’t have that many systems, and so you really had core HR data going outbound to payroll and benefits, and you might have had recruiting inbound.  There was little doubt that Payroll had the outbound file to the GL and all the other payroll “stuff” like NACHA and taxes.  Clearly, integration has gotten a bit more complex over the years.  Rather than the obvious choices we had a decade ago, I now get to hear little debates about whether all the data from TM should be sent back so that you can run reports, and so that all data can be interfaced to other areas from core HR.  The answer is a big strong “NO!”

There are a couple things at play here.  Let’s talk about analytics first.  The idea in today’s world is that you’re supposed to have a data warehouse.  Sure, this was aspirational for many of you 3-5 years ago, but if you don’t have one today, you’re flat out lagging the adoption curve.  A data warehouse usually has this thing called an ETL tool which assumes you are going to bring data into the warehouse environment from many sources.  Bringing data into the core HR system and then into the data warehouse is simply counter intuitive.  You don’t need to do it.  Certainly I have no objection to bringing in small amounts of data that may be meaningful for HR transactions in core HR, but bringing overt data in large quantities is really unnecessary.

Second, let’s talk about integration to other systems.  I’ll be the first to admit that if you have SOA up and running, you are ahead of the curve.  In fact, if you are in HR, you are at least 2 years of the curve, and maybe 3-5 years ahead of mass adoption.  The simple idea remains that integration should continue to grow simpler over time and not require the level of strenuous effort that is took in the past when we managed dozens of flat files.  However, I have a philosophical problem with trying to manage integration out of core HR.  The fact is simply that you are distributing information which core HR may not own.  The management and quality of the data cannot be guaranteed in a non-system of record, and your data owners for the element cannot be expected to manage data quality in 2 separate systems.

The whole idea of core HR as a data hub keeps popping up, and I see the whole discussion as problematic.  It stinks from a governance perspective, and it stinks from a technology perspective.  Well, now you know where I stand at least.

Bill Kutik and the Direction of HR Technology

A recent Bill Kutik Radio Show featured Tom Keebler of Towers Watson.  Tom is the Global Practice Leader of the TW HR Service Delivery Practice, and each year they run an HR Technology Survey that is probably the second largest in the industry (Lexy’s from CedarCrestone is significantly larger this year).  The TW survey is sometimes hard to get a hand on since it is distributed probably only to survey participants and Towers clients.  However, Bill gave us a brief look into some of the more interesting results of the survey, and for me, most of them happened to be in the vendor space.

While it’s no surprise that PeopleSoft has the most installs for core HR, it might come as a surprise that SAP has about a 20% market share.  This seems to be reflected in my own consulting as the number of SAP related projects or the number of core HR selections that involve SAP seems to be on the upswing.  The reasons for this seem to be simple.  In the large employer space, the number of companies who own SAP ERP far outstrips Oracle in any flavor including PeopleSoft.  All this means is that most of these large organizations already own SAP HR for free.  If you think about either SAP or PeopleSoft licensing when you get to 50k or 100k employees, you could really be talking about $5M to $20M annual software maintenance, so if you’re going to get HR for free, there seems to be some benefit to implement it.  That said, the integration that exists from a data and workflow perspective within SAP is hands down the best in the industry.  SAP flows transactions between ERP components like nobody’s business in real time.  Since PeopleSoft does not have nearly the same traction in other ERP modules (like supply chain, finance or CRM) they can’t boast the same thing.  There are of course tradeoffs in functionality or usability, but SAP seems to be catching up in the space.

What comes up as more of a surprise is that trailing PeopleSoft and SAP was ADP in 3rd place.  While I don’t know what the breakdown of ADP subscriptions is for small, medium and large employers, it’s probably safe to say that most of the subscriptions occurred in the TW small to medium space – that is under 20k employees.  What this does say about ADP is that they are getting lost of traction where organizations are still finding significant value in outsourcing payroll.  My thoughts on this is that 5 years ago when we were all excited about multi-threaded HRO, organizations are pulling back and looking at the ADP and Ceridian’s of the world to do single function outsourcing.  So while ADP’s Enterprise HRMS (v5?) is gaining momentum, I’m guessing that ADP’s GlobalView partnership with SAP is also doing well.  There are not that many organizations that can do global outsourced payroll like ADP can, and so companies with a major geographic footprint only have one place to go if they want a single vendor scenario.  (Single vendor yes, but lets remember than SAP and Cornerstone OnDemand are also part of the mix)

Last up on the list of interesting points was who the up-and-comers are.  This list seems to be based on who companies are planning to select or will be implementing in the next year.  On this list were Workday and SAP.  Again, the SAP is described above, but Workday has gained such traction in such a short amount of time that you have to be interested if they can keep up with the demand.  Certainly as the first true SaaS core HRMS, they have the ability for now to roll out functionality enhancements in the way that first generation Talent Management vendors were in the early days.  Second of all, their partnership for implementation with the Jeitosa’s and Towers Watson’s of the world should give them a bit of breathing space should the volume be larger than Workday can staff for internally.

It is a bit surprising to me that core HR seems to be changing at the pace that it is.  Usually when a market reaches a point of maturity, the vendor space settles down.  However, with the increasing viability of SaaS and the changing attitudes towards HR outsourcing, we continue to see an evolution of buying habits.  Here’s to core HR and keeping it fresh.

Note:  Sorry about the badge Bill, I’m just jealous I didn’t get a banner that looked like that.

Burnt to a Crisp

I have a friend who happens to have a particular way of ordering steaks. This is interesting for a number of reasons. First, I’m not sure how many Indian guys order steaks. Perhaps Gautam can shed some light on this for me. (I think my friend lives in Goa if that makes a difference). Second however, he orders steak in a way that just kills me every time. “I’d like it well done, really well done, like… burnt to a crisp well done.” I don’t really understand this. I mean, if you’ve cooked it this much, you’ve cooked any texture and flavor out of this thing. Why bother ordering a $40 piece of meat if you’re just going to kill it for the second and third time?

We do the same thing in HR technology. Not necessarily overcooking things, but definitely going overboard. We tend to look at the HR technology world in extremes. We’re either 100% vanilla, or we allow customization to the point of burden and we can’t support the application anymore. We like to support either lean HR processes that are sustainable and scalable, but we forget the impact on our end user customers, or we support those end user customers to such a degree that the view on sustainability and scalability is forgotten except in philosophical terms.

Unfortunately, our HR technology utilization in these terms is not usually driven by ourselves. Most often, we have a corporate philosophy that says we should take care of our customers at all costs (or take care of efficiency at all cost). We often are held hostage by those philosophies, but then 5 years down the road, we’re bought into them as well, and tell vendors and external consultants that we can’t possibly change.

In almost every consulting engagement, I do what I call a set of “sliders.” A display of extremes, and where the current state and future state lies within these extremes. In almost all cases, organizations don’t sit on either end of the extremes, but in a happy medium somewhere towards the middle. For example, in my “face to face contact vs. self service” slider, most organizations weigh in on the side of wanting to have more self service than face to face contact with their employees. However, at the same time, even HR technologists who answer my surveys intuitively know that there is a balance to be served, and that the answer is not all the way to one end of the bar, but a mix of approaches that combines both types of interaction. What is more telling, is that non HR technologists also get it, but know they have an equally hard time being centrists in practice. As I’ve built a few years of these “sliders” my experience is that organizations want to be in the middle, but the historic philosophical approach is usually an extreme, and that is a hard past to get away from.

At the end of the day, we often implement what we are most comfortable with, in a manner that continues to make us comfortable. We realize that our HR technology approach is deeply influenced by how the rest of the HR organization interacts with the enterprise, but we should also understand that we an equal or larger influencer on how HR services are delivered to the organization. I think as HR technology organizations go, we should try to start exercising some of this influence, rather than sitting back and “taking it.”

For me, I order my steaks a perfect medium. (sometimes a medium rare).

System of Record: Everything in its Place

I’m sitting on a plane (delayed of course for 4 hours) thinking about the people around me.  I have the fabulous exit row seat on the A319 where there is no seat in front of me.  The guy in the middle next to me is great.  He’s not a talker, he’s slim, does not intrude on my space at all, and basically minds his own business and his own space.  (My policy on planes is that the guy in the middle seat gets both armrests unless s/he happens to be rude, in which case any “nice” policies go out the window.)  The guy sort of in front of me has decided that since there is no seat in front of me, that he will use my foot space as his trash bin.  He’s basically been dropping his garbage literally on top of my feet for the last couple hours.  I basically kick it back at him at which point he turns around and gives me a nasty glare.  I don’t know why, but I really like order.  Things should go in their appropriate place.  When things go elsewhere where they don’t belong, problems seem to start.

For some reason, this has be thinking about systems of record and why this is such a hard thing to implement well.  There seem to be lots of battles around system of record.  Should your employee address reside in your HR or payroll system?  Assuming they are actually different systems, some people will argue that all core employee indicative data resides in the HR system as the primary and gets interfaced to payroll and everywhere else.  In general however, if the address is not current in the HR system, the ramifications are relatively minor.  In the payroll system, local taxes can go awry, garnishments are not paid or are calculated incorrectly, and year end tax statement go to the wrong place.  Then there is the never ending argument that comes from Payroll departments.  HR just does not care as much about these things.  Let’s say things are still entered manually (god forbid).  HR departments might sit on an address change for a while, but Payroll departments are all over it.

I also think about competencies.  Do competencies belong with job data in core HR? or do they sit better with all the talent stuff in a talent system?  Wait, wait, you have multiple talent systems?  Which talent system?  Are the competencies designated with the job analysis?  And do we care where the competencies are designed if they are only utilized at the talent process level?

It really comes down to data governance (do we hate data governance yet?  We should, but we don’t because not enough of us are doing it well yet).  I was recently speaking to an organization who decided that the global employee addresses were owned by the legal department in the organization.  They decided it was not HR or Payroll simply because there were enough compliance issues from global safe harbors to payroll compliance and data privacy that it could only be owned by legal.  In turn, it would then be legal’s right to decide where the system of record would be.  When it comes down to competencies, who owns this thing?  Is it compensation?  More often than not it’s talent, but this is indeed one of those data elements that get defined in such a cross functional way that it’s hard to navigate the waters.

The hope is that with the continued evolution of real time API’s and middleware, integration of data elements keeps getting easier and the conflicts that arise due to systems of record ease.

Unbundling HR

Karen Beaman over at Jeitosa recently wrote about the unbundling of HCM systems that we’ve been seeing for many years now.  She is exactly right, that often times the unbundling of HR applications away from a central ERP system provides for more agile HR service delivery.  Traditional ERP systems have not been growing at the pace they once were, Talent systems are getting implemented left and right with little or no coordination, and we seem to be going into a market where point solutions rule.

This shift is causing the modern organization to un-bundle and then re-bundle their activities and infrastructure into more agile, nimble structures that can change and scale up or down as business needs dictate. So what does all this means for the modern HR organization and for HR technology? HR has long been an organization that has worked across boundaries, and functions such as benefits and payroll have long been outsourced to third-parties. Yet, the un-bundling of HCM will have a much farther reaching impact. Beyond benefits, payroll, and call centers, we are seeing the un-bundling of HR services from RPO (recruitment process outsourcing) to off-boarding and the un-bundling of HR technology from licensed enterprise resource planning (ERP) software to subscription-based software-as-a-service (SaaS).  ((Beaman, Karen.  May 27, 2009.  “Unbundling HCM.”  Retrieved from www.jeitosa.com on September 15, 2009.))

I have nothing against either the point solution or the ERP system.  Either way there are tradeoffs to be had.  What an organization decides to implement is really quite up to it’s own needs.  However, there are a few problems I constantly see as organizations go towards a path of more point solutions:

  • Forgetting that there is a lot more integration in an ERP system than meets the eye.  Simple data interfaces are often not enough, and while every vendor touts tight integration, rarely is it true.  You can get enough integration, but at some point, you just need to realize the tradeoffs.  Let’s take job and competencies for example.  Job definition and benchmarking is a core part of the core HCM system, and it honestly should live in the HCM and not somewhere else.  To do good job design and benchmarking, you should have job attributes associated with it, some of these come in the form of competencies.  However, if you put competency libraries in the core HCM, you now have a (perhaps) very large set of data that needs to get integrated with every talent application that you own.
  • Forgetting the foundation is also a very common problem.  Not only do some organizations deal with having talent systems that are independent of their HCM, but some have multiple talent systems.  Trying to cross the lines on those same foundational competency data models across recruiting, performance, development, learning and succession platforms is a major headache if you decided to source each component independently.
  • Forgetting the process is my last major headache.  One must really ask the question if you can have a single end to end process that managers will love if you have so many systems.  After all, usability is probably more important than functionality, so forcing managers to have different user experiences for performance, compensation, etc is a major risk from the change and adoption standpoint.

I’m not suggesting that ERP is the way to go.  Indeed there are major benefits to going the point solution road, but we often forget that it’s not as easy as an interface.  There are some pretty serious integration, process, service delivery and change issues to be tackled here.  Forget them, and risk failure.  Even the best laid out plans for system implementations can’t help you if you ignore them.

Translating HR Data Elements globally

Global HR data is tough. Often times when we’re thinking about implementing a global core HR system, or a global data warehouse, we implement these systems according to a U.S. centric view of the world. (I’ll note here that I once worked with a U.K. based company that looked at their core HR system with an EMEA view of the world). This is rather disadvantageous since one of the ore problems with global implementations is that you usually start with skepticism and disengagement. This only increases when you propose your U.S. centric view of the world.

Translating not only data elements but any definition you are going to use is simply a starting point in translating data across global geographies, countries and business units. Before embarking on the implementation of systems, it’s truly useful to get some things straight. To do this, I’ll just give a couple of the more obvious examples.

— EEO (race) Codes: We love to report on EEO codes in the U.S. So much of our reporting is defined by these EEO categorizations, but we also know that EEO is exclusively a U.S. concept. As you travel globally, you quickly realize that race and ethnicity is not at all meaningful. If you go to Japan, they really could care less, since 99% of the population is actually Japanese, but they might care about ethnic variations in Japan. You might go to the Middle East where race and ethnicity does matter, but they also may want to know for discrimination purposes if you are Sunni or Shiite. In the end, most implementations I’ve done decide that trying to define and categorize race across the globe doesn’t actually make sense. Instead, they go after the thinks that they can collect like age and gender.

— Exempt versus non-exempt: Again, this is a U.S. centric concept that is defined by FLSA. If you went around the globe and talked about exempt employees, your audience would be bewildered. While it’s not a direct and perfect translation, most other organizations in the world can indeed relate to overtime eligible or not overtime eligible. Simply changing the data labels allows you to move forward with a global terminology that makes sense to everyone.

One of the key failure points of global implementations (there are many however) is the lack of common definitions across the globe. As soon as your global population feels that this is just another corporate initiative that U.S. stakeholders will benefit from, your international population will disengage. There are all sorts of prepatory activities you need to tackle prior to implementing, and data definitions is probably one of the first you should tackle.

Global HRMS Cultural Issues

Everyone wants global data.  They want it in a global HRMS, or in a data warehouse.  They want shared accessible data in communized practices and processes.  They want the ability to roll-up data and aggregate reports and dashboards.  They want workflow that crosses borders, and business units.  To be honest, all of this is quite simple.  The technology easily exists to do all of this and more.  The problem is not the technology, but the cultures involved when you do global deployments.

I’m going to simplify things, and speak in the generalities of 3 major regions.  The Americas (usually the U.S. based business, but also encompassing at least North American partners) has reached a maturity in global business where they have a decent understanding about how to deploy global systems.  U.S. multi-nationals have realized that good adoption of a global system will include early interaction from the global business partners.  Even then, the U.S. is highly region-centric and doesn’t get the cost and complexity of trying to integrate global requirements into a single HRMS, although they generally really do try (now).  And all of this is if a U.S. based business is calling the shots.  More on the U.S. as a non-HQ region in a second.

EMEA (usually just a European business) justifiably think that they are quite unique.  In fact, most American’s simply don’t understand the complex business environment that exists in EMEA.  American’s tend to think the labor laws and financial requirements that exist in the U.S. must far surpass any complexity in EMEA, but that is far from true.  EMEA is insanely difficult as you deploy languages, compliance requirements, differences in dealing with unions and work councils, and cross borders (lots of them).  When EMEA is the HQ country, Europeans are a bit behind the U.S. in understanding global HR requirements.  I’ll use the SAP system as a general example.  SAP was always far behind any other HR systems in formulating their HR requirements.  They simply didn’t see them as important, and the functionality was lead by U.S. based software companies.  It really was not until the early 2000’s that SAP started to understand, but by then, other software companies had a decade head start.  Even today, U.S. based
software companies seem to be far ahead in the area of advanced functionality.

Asia/Pac seems to be its own annoying world.  Not only are they fairly antagonistic to “West-lead” initiatives, but they often don’t agree with the approach.  I’ll have to give Japan a release on this one, but countries like China are becoming an integral part of global enterprises.  Unfortunately, China is a prime example of a country that can literally hire 100 people just to run manual processes and still have a positive ROI versus implementing automation.  Still, Asian subs and business units seem to like to do things their own way.

The core problem with global data is not about the technology.  In fact, it’s really not even about the peculiarities of the HQ  cultures.  Instead, there is a global problem that simply points to the fact that each HQ places prime importance in the requirements that are most visible – their own.  Alternative requirements don’t have as lofty a place, and when global systems are then implemented on top of biased priorities, you end up getting really unhappy region and business units.

The HR Software Slump

I was recently getting caught up on some blog reading and noticed Josh Bersin’s post on the Talent Management Software Slump.  I’m not sure if I’m just a pessimist, but I thought I’d post a reply.  (granted, Josh wrote his post in early May…

Despite this difficult Q1, we believe the market is going to come roaring back in Q2 or Q3 of 2009.  Most of the private companies we talk with (Plateau, CornerstoneOnDemand, Learn.com, GeoLearning, Halogen, and others) tell us that while they had a weak Q1, they have seen tremendous growth opportunities in Q2.

First, the mid-market and small enterprise segment of talent management is starting to grow rapidly.

Fourth, there is still tremendous demand for talent management software.  In today’s rapidly changing workforce (from layoffs to restructuring to rapid growth), the value of this set of software is greater than ever.  While Q1 was tough for vendors, most buyers only postponed their purchases – giving themselves more time to evaluate options and improve their own businesses.  In Q2, Q3, and Q4 these companies will buy these systems.

So my thinking on the slump basically reflects back to 2001 when the dot-com bubble “burst.”  When that happened, basically, HR technology spending totally dried up.  It actually took about 3 years for HR technology spending to come back, and when it did, spending came back with a vengeance.  My theory on this was that when spending cuts happened in 2001, HR technology was among the first to be cut.  Then as the recession ended and things got better, neglected business critical technologies were upgraded, implemented, and restored.  Things like CRM or supply chain that didn’t get needed upgrades for months or years got the first funding dollars.

As we all know (or think), in most companies HR funding is a lower priority than other business functions.  I don’t see any reason to see this to be any different as the economy recovers this time.  As organizational revenues recover, employees will be rehired or returned from furloughs, business critical applications will be maintained first, and budget cycles will still lag a year behind needs.  Before an organization goes out and spends $100K or even $1M on any HR application including talent management, there are a whole lot of other unspent business critical dollars that will probably come first.  HR budgets that got slashed in 2009 will still remain slashed in organizations with any governance at all.  Perhaps some organizations will get dollars in their budgeting cycles at the end of this year, making dollars available in 2010, but I’m guessing that 2010 budgets will focus in other areas than HR.

Perhaps Josh is a better judge than I am though.  It may indeed be possible that certain talent applications will actually fare better than most other HR technologies.  Performance and Succession ran such high profiles in the last few years that we can only hope executives remain enamored with those technologies.  I’m not a big fan of looking at vendor pipelines for guidance on future sales.  Every vendor (application, outsourcing, or consultancy) has great looking pipelines right now.  Salespeople seem to be sandbagging as much questionable prospecting into their pipeline portfolios as they can right now, as much to remain optimistic as to try and keep their jobs.  Pipelines are also more robust in number of prospects, but smaller in terms of deal size.  The mega deals that have kept vendors going for years will be slower to rebound.  I think that most organization will have to deal with the technologies they were able to install in the last couple of years and hope they continue to work for a couple more years.

Core HR in a Point Solution World

Perhaps the statement that we now live in a “point solution world” for HR is a bit bold.  Certainly in large and medium sized organizations, ERP deployments are still strong.  However, we do know that these same organizations are increasingly looking at point solutions even if they have had long term ERP strategies.  Current day economies combined with lower short term costs for SaaS provide good business cases for deployments that have to happen in the next couple of years, or as bridges of functionality until a long term solution has been developed.  The question in the marketplace is now “what is happening in core HR?”

Core HR is more of a commodity than ever.  Truly it has simply turned into a specific set of functionality, and that which made it strategic before has been ripped out of core and placed into other applications or engines.  First, let’s look at commoditization.  At one time, the ability to provide table driven data validation, full effective dating, and robust compliance was the domain of a few major players.  Now, these functions are a part of almost all major HRMS solutions offered at any price.

Second, we look at functionality that used to make core HR solutions strategic.  I’ll call these workflow and analytics.  From the process standpoint, end to end solutions no longer exist in the HRMS application.  Indeed, end to end workflow barely exists at all.  Point solutions have virtually disabled the ability to flow work and approvals through multiple products with different approvals in each.  While it is possible to utilize a workflow engine to accomplish this, the cost is prohibitive to all but a few very large organizations, and I have not seen HR a high enough priority anywhere to deploy it.  Analytics on the other hand have almost been fully removed from the HRMS application.  Value can’t be provided by core HR if none of the talent, payroll and benefits data sits in other applications or outsourcers.  Indeed, as the value of analytics comes from cross functional data analysis, business intelligence is really the domain of massive data warehouse applications.

Third, the old employee and manager self service systems are mature and ubiquitous.  Having employees enter in their new phone number is not very exciting anymore, and the real self service functions of performance reviews or compensation processes are generally removed to the talent systems.  Instead, we move to massive portal environments that remove the existing self service functions from each individual application and centralize the user interface.

If indeed the HRMS application has been commoditized in terms of functionality, then the lowest price point that offers scalability and good data architecture (not all applications out there are very pretty from the backside) would seem to suffice.   Scalability obviously so that your organization can not only grow, but store greater amounts of employee effective dated rows over time.  Good data architecture because the ability to port data into data warehousing applications as well as integrating to other point solutions will be made much simpler.

CedarCrestone Pulse Update

CedarCrestone recently updated their annual HRIT survey covering the trends in HR budgets.  It’s especially interesting right now as the economy swings down.  There is obviously much more content and charts in the real report you can get from CedarCrestone, but here’s a quick summary and my comments.

During December 2008, CedarCrestone conducted its first “PULSE” survey of 828 respondents to our 11th annual survey to determine if budgets for HR technologies are changing due to the economy. The annual survey ran between June and August 2008, prior to the dramatic downturn in the final quarter of 2008. For this CedarCrestone PULSE, 20% of original respondents participated. A surprising 70% of respondents reported no change in HR systems budgets. This large percentage is surprising in light of the daily gloomy economic reports. Are respondents maintaining their current HR systems strategies or was senior management waiting until after the holidays to make budget changes?

Of the 30% reporting a change, on average 11% report an increase and 19% report a decrease. The average increase is in the 1–5% range. The average decrease is in the 6–10% range. The net change averages -6%. The smallest net decrease (-4%) across the application categories we track is for the talent management applications. Those with plans for business intelligence applications are the smallest percentage reporting a decrease (15%). Three industries had a positive net: Consumer manufacturing (2%), higher education and public sector (each at 1%).

Most of us won’t at all be surprised at a slight trend to smaller HRIT budgets.  I think what is going on here is that the operational budgets of running HRIT are intact.  There are normal activities and staff that are needed to keep the systems running.  Implementations and upgrades that are in progress have already been funded and will generally stay in progress.

Where I would anticipate some lowering of budgets are in the new discretionary strategy projects.  These are expensive and if not in progress already, these are the type of projects organizations have lived without for years and a few more months won’t hurt.  While I don’t necessarily agree with this thinking, certainly it’s better to not being new projects than to stop projects in mid-stream.

Workday Update

Being that Workday is announcing their Fall 2008 update today, I figured it was a s good a time as any to get this site back up and running again.  As probably the most hyped vendor in the HR space this year, they have still had impressive growth with 67 current total clients and 35 live clients.  They only have 4 clients on financials, but given how difficult it is for companies to move financials in the current strict regulatory environment, the rapid expansion in HR and less rapid sales for financials is not a surprise.  The large majority of these are on core HR and benefits, but there are a couple on payroll as well.  They also have a couple on Workday payroll, even with vendors such as ADP as partners.

The last year saw some surprises in the market.  The signing of Flextronics (a 200k employee global company) in San Jose was a steal from the grasp of SAP, and a much larger deal than anyone realized Workday was going for at the time.  While perhaps Workday would not mind more of the Fortune 500 in their list of clients, singing these contracts is quite costly, and few and far between.  Workday has still expressed that their core sweet spot will be between 5-25k employees from a marketing perspective, and I’ll wait to see how Flex goes before pronouncing that their large employer, global capabilities are really executable.  Please don’t call me cynical – after all, neither SAP or Oracle have really pulled off the global HR application yet either.  I’ve written before about Worday’s revisioning of the organization structure and its support of the matrix organization.  I’ll look to this revisioning of organization to help facilitate the potential of a single global database for an employer.

So what’s in the new release?  Well, overall, it’s a further expansion of their overall plan which rests its foundation on SaaS delivery and Web 2.0 architecture.  Their value proposition (in addition to their delivery platform) still is that their approach to HCM is more business centric than their competitors.  The first major component is a build-in BI (business intelligence) tool based on their belief that their HCM application should be a storage point for all employee data.  While they resist any implication that their HCM could be used as a fully deployed data warehouse, I assume that they have semi-engineered the table structures to accommodate multi-dimensional reporting without having to use a separate data warehouse application.  Regardless of how they have done it, it seems that integrated BI is made quite a bit easier with SaaS deployments, and this seems to follow in the footsteps of what many talent management vendors are also putting together.

The second piece is the worker spend functionality.  The ability to report on employee costs outside of total compensation which is not dependent on the availability of a financials implementation.  I’ll be the first to admit that I don’t know enough about this module, but I’m envisioning some sort of manager self service combined with shopping cart functionality that has costs rolling through based on the dynamic org structures.  I’ll believe it when I see it, but it sounds cool.

The excitement that Workday has generated over the last 2 years has been extraordinary, and not having to carry the baggage of legacy coding is certainly an advantage.  So far, quality seems to be good, and their ability to innovate in the development process is better than average.  I’ll continue to keep my eye on them in 2009.

For the time being, I’m going to continue my siesta, so have a great holiday season and I’ll look forward to writing in 2009.

-Dubs

The Workday Promise (and Challenge)

The fact that the market is excited about Workday would be an understatement.  Hype around this company’s products and functionality appear to be racing quite past reality and approach mythical levels.  Perhaps the confidence in the HR industry for Dave (Duffield) to deliver another great HR application is deservedly high.  Or perhaps the marketing of Workday is simply a lesson in how marketing should be done.  While I’d suggest that both might have some level of truth, there also seems to be an unrealistic expectation that customers have.

The promise of Workday was that they could reinvent applications and the way users interacted with them.  This was spectacularly show in their HR application where they completely redesigned the way they see the organization structure.  Many of us remember and still work with the rigid org structures that are in just about any HRMS system.  They become a unflexible way to manage security, workflow, reporting, etc.  However, in todays HR world that is driven more by cross functional and end to end processes, inflexible organization structures were a significant barrier to our ability to reinvent how we see other functionality.

The core areas of Workday’s HCM application (like the org structure and the core technology and UI) are great.  However, as they move into sales and marketing, the demand for their applications seems fairly high, and customers are beginning to demand more traditional functionality.  As buyers buy, they like the idea of a very innovative application, but they feel that they need the old functionality they have always had.  Workday is now in the situation where they wanted to do something very cool and different, but are needing to meet the realities of customer demands.  What will their talent management applications look like?  Will they have the opportunity to create something new and amazing (the way Taleo did) or will they cave to the cries of the customer?