John Enyedy of Track-it.com HR solutions wrote this paper for HR.com. I really need to stop reading things in HR.com and SHRM as I’m never terribly impressed. As usual, I have a difference of opinion. Perhaps the below quote is a reality in low end HRMS, but certainly I think most of us would simply say the writer is simply wrong.
Overview of the HRIS Market
As is true with any product, HR software is designed for an ideal or target user. Since HR software is basically used for keeping track of employees, for the purpose of this paper we will divide companies into 3 categories Small (less than 100 employees), Medium (100 to 1000 employees) and Large (more than 1000 employees). The needs of each of these company categories are different as are the expectations of the user within each size company, so one of the first key questions that need to be answered is “What is the target market for a particular product?” Not only will the price of the software help position the product but also the features, installation and training costs and length of time to be up and running. Don’t be fooled by price, often times a lower priced product will be the “Right Product” thus creating a substantial savings in time and money. Don’t be fooled by long list of features, the “Right Product” is the one that meets your requirements, not the one with the longest list. Don’t be fooled by a flashy presentation, the “Right Product” is the one that you and or your staff can easily learn, and use day-in and day out to help you do your job, not the one with the coolest screens etc.
John Enyedy, January 2, 2006. “What You Need to Know Before You Buy a HRIS,” HR.com. Retrieved from HR.com on January 5, 2006. ,Formatting added.
Considering this blog is all about the integration of HR technology and strategy, I find it odd that a CEO of an HR technology firm is saying their software is administrative only. Certainly I don’t think we’d ever hear this from the SuccessFactors or Taleo blogs, let alone a vendor’s marketing department!!! At the end of the above quote Enyedy goes on to say that the right solution helps you do your job and is easy to learn. No mention of how HRMS and other HR solutions help you manage your workforce and increase the flow of critical employee data to front line managers and executives.
Certainly I’ve never seen Trak-It solutions. I’m guessing this is mid-market or below type stuff, but that’s not an endictment of the product. I’m just making an observation regarding the perceived value.
6 responses to “Value of Mid Market HRMS = Not Much”
I think you are both right in your respective markets. What I find most interesting is that we are always splitting these markets based on the number of employees rather that a more important designation that would point a company one way or the other. Wether a company views it HR as tactical or strategic is more of a determining factor in which type of software the customer needs. Not all business requires a strategic workforce and not all tier I companies are strategic. John Enyedy is dead right about his segment and based on what this board talks about alot you are right to disagree (as this is not your “preffered” segment). I always laugh at how arrogant the discussions around tier I HR software are. Today there are less than 20% of the tier I vendors still in business fighting over the same 3000 global accounts. HR is found in all size companies and whether it is “strategic” or “tactical” it is just as important to the people involved in working through its problems. Love the site..
Todd Asevedo, SPHR
Todd. That is great perspective. I really must admit that I have no idea what is important to small and lower end mid market companies. I’ve just been too far removed for too long. Clearly when you have 200 employees and 1 or 2 HR practitioners, the focus of HR is very different from an organization with dozens if not hundreds of HR folk.
Long ago, I was the HR Director for a small manufacturing company. I spent the mornings with the master planner (scheduling materials and product through the plant) and every afternoon with QA and understanding what was going on with necessary corective actions. With me and 3 other HR staff, all I ever did was work on core business issues and applied HR to recruit, redeploy, and retrain resources to fit those needs. I don’t think you have to be from a big company to get the bigger picture, although that certainly helps in terms of resources.
I’m not sure if I would characterize “tier 1” vendors and practitioners as arrogant. Perhaps this is me being defensive, but I really like the idea that with more HR headcount and budget, there is simply an opportunity to broader work.
Thanks for reading AND participating!!!
Thanks Dubs
I probably shouldn’t have used such a reactionary word but I too am bothered by the attitude that if you aren’t dealing with a multi-million dollar budget and saving the world you aren’t adding value or doing “real” HR work. I see that judgement a lot in the tier I writing and editorializing.
As an HR Technology consultant I have worked in all sizes and flavors of companies and find a similar thread in the relationship between Family Doctors and say a Cardiologist. Its important to remember that they both save lives though one is usually less dramatic…
Thanks for this site… I really enjoy it.
Todd Asevedo
Hi,
As an HR software vendor and former VP of HR, I agree with the assessments on this blog that HR product fit is defined in terms of need and not company size.
HR need can roughly be related to process maturity of an enterprise. In my view, you see three stages – Control, Communicate and Coordinate.
In Control you’ve got HR just tring to manage a bunch of spreadsheets and know who is employed and how much they are paid.
In communication, which generally happens around 100 ee’s, you see a need to deliver policies driven by internal and external requirements.
At Coordinate HR begins helping manage employee inputs and outpus in line with the company’s stragegic plan.
One interesting observation, I think the number of customers HR serves is inversely proportional to the maturity of the organization. By this I mean, that as the company moves further away from control issues, HR’s “customer” becomes line managers and ultimatley executive management.
What I see in the HR market is an inability for software to adapt up and down the tree stages. That’s probably why you see a lot of companies upgrade vendors as opposed to products in the midmarket.
Anyway, thanks for the good blog.
Sunil
“One interesting observation, I think the number of customers HR serves is inversely proportional to the maturity of the organization. By this I mean, that as the company moves further away from control issues, HR’s “customer” becomes line managers and ultimatley executive management.”
Sunil: This is entirely possible and I believe I see it quite often. As HR becomes more “strategic” there is greater alignment with the executive vision. However, to achieve that vision, there is greater focus on different types of employee processes. Where smaller organizations may be higher touch, larger organizations are focused on the quality of that touch. So while the customer shifts away from the employee slightly, the overall employee experience might be better anyhow. Thoughts?
-Dubs
I think what your saying is right. The larger the organization, the more HR needs to focus on the management needs in order to better the situation for employees. It seems that in a large company the nexus between an employee and the value he/she generates is not as clear as in a small company. Value is shown in numbers, e.g. performance indicators, competencies, costs, etc…, as opposed to a small company where the value, both tangible and intangible, can be seen by senior management. Consequently, if HR does not focus on the management issues, it will not demonstrate the value of employees. If management does not see value in its investment, in this case employees, it is not likely to increase investment, i.e. put more money into its workforce. Where HR has helped show the value of management’s investment in the workforce, I think you will see a better employee eperience because management will see the investment as an asset.
– Sunil