A Peek in the Valley
A Peek in the Valley | Human Resource Executive Online
Highlights from a recent tour of a few of the big HR systems -- including some of the new developments worth paying attention to. While there is a lot of innovation (as always), there are many reasons some things will stay the same, including the inescapable complexities of software for accomplishing administrative work.
By Bill Kutik, HR Technology Columnist
Looking for a major trend in HR technology?
Nearly every HR vendor I spoke with in Silicon Valley during my annual July week of briefings referenced common consumer Internet applications as a model for their future development.
Oracle spoke of using Facebook as a guide to writing applications that require fewer clicks.
Taleo said its new Solution Exchange Web site for buying add-on apps is "just like iTunes."
Workday proudly displayed its new iPhone app.
SAP is using Jive, the most popular social-networking software, for informal learning.
Even HR professionals, not just casual users, are beginning to expect the ease of use of Google or Amazon from their HRMS. A noble goal, I agree, but not likely to be achieved anytime soon, at least not inside large companies using the three big HR systems I'll be discussing here which handle very complex processes.
While there is a lot of innovation to report from the Valley (as always), there are many reasons some things will stay the same, including the inescapable complexities of software for accomplishing administrative work.
Still Waiting for Fusion
The only thing industry observers care about regarding Oracle these days is how much -- after five years of promises -- it will reveal about the new Fusion applications at its Oracle Open World user conference in October.
But actual users of Oracle's e-Business Suite (EBS) for HCM still care about the upgrades being offered to their software. The same can be said for users of PeopleSoft Enterprise, Version 9.1.
Anand Subbaraman, director of Oracle EBS HCM product strategy, offered insights into the latest release, Version 12.1, made available on April 27, plus his roadmap for the future.
First, Oracle made good on all its promises for the
new version made last summer
, with one exception: The more robust onboarding app, which SAP also chose not to create, remains just a checklist, far from the deep functionality offered by others, such as Silkroad and Enwisen.
Oracle is most proud of Cisco buying 12.1 to replace its PeopleSoft 8.3, as well as 33 other existing systems. And it boasts of other HCM wins this year against SAP and Workday, even wins for individual modules against Taleo and SuccessFactors (another reflection of the fierce competition in talent management between the ERPs and the smaller suite vendors).
Oracle has sold Version 12 to 130 companies (many of them new customers). That was largely a technical release without much new functionality. The first 12.1 customers are expected to be announced this month. Worldwide, Oracle has about 5,000 companies live on various EBS HCM versions, including 2,000 in the United States. Most are on the previous Version 11i.
Version 12.1 does include an expanded Talent Profile (other vendors call it Person Profile), the key to all TM apps working together. It also comes free with self-service, which Oracle still sells separately.
The profile includes only official data from the HRMS and not much of the personal LinkedIn- and Facebook-type data that other vendors are working to include in their profiles (see SAP below). But it's all on one screen, which is useful.
The new Succession Planning module works in traditional fashion: selecting people for specific jobs, rather than creating a talent pool of high potentials for a variety of jobs. Some prefer the new method because the responsibilities of senior positions now change so frequently.
But the new module does allow easy comparison of up to three candidates at a time, plus a 9-box suitability match and even overlaid radar diagrams with user-selected criteria.
As promised, Oracle has added employee-referral functionality to its iRecruitment module, now used by 600 customers (many in Europe). It's still not clear how it will use ResumePal, JobFox's job-matching engine -- something Oracle agreed to do (with four other major vendors) in March.
After buying Siebel and Hyperion, two companies with outstanding analytics, Oracle is moving that functionality into HCM. Right now, it has 1,250 standard reports; Oracle Business Intelligence (a data warehouse) with metrics for HCM, talent and Recruiting; and Embedded Analytics for some of the TM apps, including Compensation, Recruiting and Learning, some with their own dashboards.
Looking over the horizon, Subbaraman has lots of ideas. They include more social information for the Talent Profiles, budget-based workforce planning, mass hiring, Web 2.0 desktop gadgets or widgets, an onboarding and off-boarding app, and "Employee Connect," a private social network Oracle has talked about for two or three years while only using it internally.
A Web 2.0 application was planned to debut this summer -- the Talent Prospector collaborative app for both EBS and Enterprise, designed to help recruiters locate and pursue passive candidates.
Good to see Web 2.0 apps finally working their way into ERP offerings after lots of talk and PowerPoint slides for way too long.
SAP's Vision of the Future
I've long valued the ideas of SAP's David Ludlow because he's been in charge of HR apps there for nearly 10 years -- longer than anyone at the other vendors -- not to mention an earlier decade spent in products at Tesseract, the former HRMS gold standard.
Ludlow says, "Our future is taking the back-end data and exposing it to users in new ways so they can consume it more effectively."
And, of course, that means exposing it to everyone, not just HR, because it's fundamental to other processes in the organization. That's his worthy mission, which he describes as the way SAP will compete against Software-as-a-Service offerings from the suite vendors and Workday.
Following SAP's two failed attempts at delivering Business ByDesign as an SaaS product, Ludlow points to Northgate/Arinso's new euHReka product, built around his own company's HCM, as the way for customers to get its functionality delivered via SaaS.
SAP is the first major vendor to extend its Talent Profile from just including official HRMS data to incorporating personal information, though this feature is still in prototype. Ludlow is also trying to connect his customers to LinkedIn without compromising their security.
Naturally, it takes more than one screen to get everything in, including a 9-box and competencies. This is similar to what SuccessFactors has done with its new
Employee Central
.
Ludlow says SAP is winning vendor selections against the TM-suite vendors, and continues to build out Performance, Compensation and Succession -- even though they are sold with the core HCM product (certainly a selection advantage) -- as well as e-Recruiting, which is sold separately.
SAP has more than doubled Performance customers in the last two years with more than 200 live now and another 200 implementing. The app now includes goals and cascading goals. The modern concept of talent pools has been added to Succession and pay-for-performance is beefed up in Compensation.
Next year, e-Recruiting will be enhanced so that all information gathered about a candidate can be moved into the HRMS after the person is hired -- long a goal of those pursuing TM-suite integration.
If you doubt that SAP has integrated its TM apps and reached parity with some suite vendors in functionality, see for yourself at the HR Technology® Conference's
Second Annual Talent Management Shootout
on Oct. 1 in Chicago, when SAP goes up against Lawson, Plateau and Salary.com.
Some of this comes from SAP's deepening partnership with Nakisa, a provider of software that is being used to visualize data in the new Succession Planning module, generate a planned actionable org chart (see Workday below) and build a common competency structure in all the applications.
SAP is developing widgets for various HCM applications that users can place on their portal page. At the same time, the company is abandoning mandatory use of its own portal software in favor of Microsoft's Sharepoint, which is a growing portal standard.
Like Oracle, SAP is also building out Workforce Management (currently just the old Campbell Software for retail only) to include field-service scheduling through a partnership with Israel's ClickSoftware. It will soon be expanded to the public sector, including nurses and police. Workforce Planning is also on the product roadmap.
Ludlow abandoned plans to build an ambitious onboarding module, when customers refused to give pre-hires access to an internal system. Apparently, these customers missed the entire point of on-boarding software: getting new hires to do all that work on their own time before starting! Instead, SAP is partnering with Enwisen to deliver a pre-hire portal.
Finally, with SAP's acquisition of Business Objects, look for new analytical capabilities across many of its HCM apps.
Workday Reaches Functional Parity
CEO Dave Duffield believes Workday HCM has reached functional parity with the core HR capabilities of these "legacy systems," his favorite term for Oracle, Oracle/PeopleSoft and SAP. "We've crossed the chasm with HR and Benefits," he says, "and next year with Payroll." Payroll has signed 10 customers, with four live in August.
Duffield found sales disappointing in the first half of the year because he was shooting for 60-percent to 70-percent growth and only got 40 percent above last year's first half. Workday has signed 92 customers now, compared to 54 at this approximate time last year.
Workday continues to pioneer in two important and fundamental areas for HR.
The first is developing new ways for users to navigate the apps. From the start, Workday created a Copernican revolution with its apps revolving around the person, rather than the other way around. That means once you had the person -- say in an actionable org chart -- all available apps are right there. No more opening and closing apps and finding the person time and again, as in older systems. Many vendors are copying it.
Now it has extended that to interactive graphs and charts (either from a report or from embedded analytics). Click on the chart and the apps to take appropriate action are right there. Very cool.
In Upgrade 9, due out in October, Workday is breaking the presentation mold of every modern HR product I've seen. It is offering an alternative to the square and rectangular boxes jammed onto everyone's home page or dashboard for years -- crammed with lists, incomplete actions, e-mails and maybe a chart or two.
Instead, its optional new landing page for Employee and Manager Self-Service presents a circle of icons representing all those things. Click on one, and a box opens in the center of them with the list. This may turn out to be mere window-dressing, but it's the unintimidating way self-service started because it needs to appear simple for people only using it occasionally. A nice new twist on an old idea, but terribly easy to copy.
What no one can copy is the second, and more important, area: money. Thanks to Mark Nittler, vice president and head of Financial Management product strategy, Workday is marrying HR to the money. And if he succeeds, Workday will revolutionize the practice of HR, making it vital to running the business.
He points out that traditional ERP systems, created mainly for companies manufacturing things, answer the following questions: What are the inputs (materials, etc.)? What are the products? What do they cost? Which ones are profitable?
For a people-centric business, he wants Workday HCM to answer: Who works here? What do they do? What do they cost? What are the financial results?
Notice this is more relevant to the business as a whole than to traditional HR. But determining how employees actually create profit is the toughest question around.
First, you have to know what they really cost. To move closer to the answer, Workday is enlarging the scope of its year-old Worker Spend Module, the industry's first. Don't think that means the Financial Management tail has started wagging the HCM dog at Workday. Not when customers can't use Financial Management or the other two modules without having HCM first. After all, the system's architecture is based on the person.
The other two modules are Payroll and the Benefits Network, which currently connects about three-quarters of Workday clients (last year it was half) to more than 100 benefit providers (a dozen or more last year) for monthly premium reconciliation and other activities.
About 15 customers have bought the Worker Spend Module and seven went live when it covered only employee travel and expenses and approvals. Now it covers elements of Business Resources (employees' laptops, cell phones, expensive calling plans, company cars, etc.), eProcurement (purchase orders), and most importantly, Service Procurement, which includes contingent workers and professional services. Naturally, it will include analytics with lots more functionality in Update 9.
Remember all the talk five or more years ago about service-oriented architecture and Web Services? Certainly all the recent chatter about SaaS? How they would all change our lives, at least before everyone became consumed by the latest buzzword: cloud computing.
Since Workday uses all that latest technology, its customer experience is a good example of what will and won't change.
Some people mistakenly believe that SaaS business apps are like Amazon: Fire up your browser, type in the URL, and you're instantly buying books. No, your business processes are a lot more complicated than that and probably need to be better defined before installing software, unless you really want to pave the cow paths. Plus you have tons of important historical data stored perhaps in a dozen systems, and in as many different formats, that have to be scrubbed, normalized and imported.
So despite someone else hosting your applications (and taking care of those gnarly upgrades or updates and even normal maintenance), you still need an implementation. Just like always.
In the face of this widespread misbelief that implementation isn't necessary, Workday admits that its typical implementation costs half the price of a three-year service contract. Better than the old price quote of two-to-10 times the cost of a perpetual license, but more than pocket change.
Plus, starting at system design, implementation can take anywhere from a record 38 days using templates to 425 days for Chiquita Brands (whose chief information officer,
Manjit Singh
, will explain it all at the HR Technology® Conference). Workday's average is 120 to 150 days.
And that old cliché: "Whoever needed training on Amazon?" True, but for HR professionals, HCM ain't Amazon. So, Workday still offers a variety of three-day training classes off-site, one-to-three-hour virtual classes and shorter training available on-demand.
None of this is meant to detract from all the improvements new technology will be bringing to our world, but just to point out that some things stay the same.
What?!? No BlackBerry or iPhone?
Speaking of remaining the same, I don't own either one. But then I don't have to use any of the enterprise apps that have already been enabled for smartphones.
Workday has an app for managerial approvals available on the iStore (coming soon for BlackBerry). So does Oracle, but only for recruiting approvals on the iPhone (other apps it sells direct). SAP has a prototype for the BlackBerry.
Will this new mobile-computing platform mean the death of laptops with their real keyboards? Not for those of us who write! On the road, I use a ThinkPad just for its superior keyboard. At home, I use a 1985 IBM-AT keyboard that goes clickety-clack like a typewriter.
Try taking it away from me, and I can knock you out with it. Old IBM iron.
HR Technology Columnist Bill Kutik is co-chairman of the
12th Annual HR Technology Conference & Exposition
® in Chicago, Sept. 30 to Oct. 2. Read the full 2009 agenda and register online to avoid lines at the door. He is also host of
The Bill Kutik Radio Show
®
. He can be reached at
bkutik@earthlink.net
.
September 16, 2009 Copyright 2009© LRP Publications
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