HR Software Face-Off Reveals Latest Trends

By Ed Frauenheim

A highly anticipated “battle” at this year’s HR Technology Conference & Exposition revealed that social networking and “Web 2.0” features are key weapons for HR software vendors today.

Oracle, Lawson and Workday presented elements of social networking and the kind of consumer-friendly Internet interactivity that people have come to expect of software during the October 11 head-to-head-to-head showdown, held at the annual Chicago conference put on by Human Resource Executive magazine.

Lawson, for example, demonstrated how its new set of HR software tools can allow employees to post jobs from their firm’s career Web page directly onto their page at the popular social networking site Facebook. And companies can arrange to have employees earn a referral bonus if a job is filled by someone who applied through their Facebook page.

Such features let companies “put the job postings where the future talent lives and breathes,” says Larry Dunivan, Lawson’s vice president of global human capital management.

There’s a push to build greater interactivity and social networking capabilities into HR software. The applications are being used by a wider variety of employees as well as younger ones who grew up with the Internet and who frequent sites like MySpace.

Partly because of potential talent wars, HR applications are now the hottest area of business software. And the “battle” among vendors at this year’s HR tech show promised to be intriguing.

Unlike other HR Technology Conference showdowns among vendors, audience members were not asked to cast votes at the Oracle-Lawson-Workday event.

Organizers says a new format would make apples-to-apples comparisons impossible. The lack of a clear victor may have lowered the excitement level some, but drama was provided by having legendary PeopleSoft leader Dave Duffield pit his Workday product against Oracle. Duffield founded Workday in 2005, not long after losing a bid to keep PeopleSoft from being snapped up by Oracle.

At the “battle,” Duffield didn’t fail to entertain an audience that probably topped 1,500 people. Surveying the crowd, he made light of the legions of lawyers brought to bear during Oracle’s initially unwelcome acquisition attempt.

“I haven’t seen as many people in one room since our attorneys during the hostile takeover,” he says, drawing laughter and applause.

Duffield’s new firm stood out from Lawson and Oracle with its Google-like search field. That search box can be used to scan the Workday application using terms like “bonus.” The results from the searches are links that allow users to take actions such as creating a new compensation bonus program.

Oracle demonstrated that it is up on the latest trends of collaboration and social networking. Gretchen Alarcon, Oracle’s vice president for human capital management strategy, showed how an Oracle technology could allow employees to establish informal networks devoted to a particular topic and help workers further their careers by learning about job openings from colleagues. Alarcon called this embrace of peer-to-peer networks and sharing “Enterprise 2.0 for human capital management.”

A version of the collaboration technology, called WebCenter, is available now, but Oracle’s demo used a version of the product that is still in development.

Source:Workforce.com

Talent Management Keeping Score With HR Analytics Software

By Ed Frauenheim

Today’s cutting-edge technology for managing talent has much in common with car dashboards and baseball cards. Makers of software to help firms recruit, assess, develop and retain employees are trying to present key data in ways as simple to understand as a speedometer or fuel gauge. And just as baseball cards combine player photos with important statistics, companies can view snapshots of their team members that include a range of key information, such as salary level and performance rating.

Software firm Authoria, for example, allows managers to see an organizational chart on the computer screen with images of their direct reports presented almost like baseball cards. Below the photo of Joe Smith is his job title, performance rating, the amount of time Joe has worked at the company and how long he’s been in his current position.

This way of organizing information not only is easy on the eye, it eliminates much of the grunt work associated with trying to analyze data stored in paper records, spreadsheets or Microsoft Word documents, says Jeff Cooper, senior business consultant at Authoria. In effect, workforce analysis and presentation tools like those from Authoria raise the game of human resources managers and other company leaders, Cooper says. “Now that person can focus more strategically,” he says.

Workforce analytics applications refer to software products that help a company draw conclusions from its human resources data. These tools are considered particularly vital for the most strategic talent management tasks, which include recruiting the right employees, measuring their performance, helping them develop and compensating them effectively. To make smart decisions around hiring, promotion and pay, firms ideally need to sift quickly through data such as performance reviews, salary levels and even store revenue.

Partly because organizations are eager to make wiser talent management calls, there is growing interest in workforce analysis applications and related “dashboards” or “scorecards.” The momentum also stems from the way such software has become both more sophisticated and simpler to use during the past five years or so.

Still, some skepticism surrounds the analytics field. Vendors of analytics tools have not always provided effective software or guidance to customers, experts say. It remains difficult for large companies to gather basic employee data such as headcount—which makes scouring the information for trends difficult. And it’s not clear that organizations know what information they should be looking for.

Jodi Starkman, a talent management specialist with consulting firm ORC Worldwide, says diving into workforce analytics applications can just result in making a bad pro¬cess—such as recruiting from poor sources of candidates —more efficient.

“HR is collecting a lot of data,” Starkman says. “But people are still confused about what kinds of business questions they should be answering.”

Firms showing interest
A recent study from the International Association for Human Resource Information Management professional group and consulting firm Knowledge Infusion suggests many companies are not doing heavy analysis of their workforce data. In the survey, which polled IHRIM members and Knowledge Infusion customers, 52 percent of respondents with 2,500 employees or more cited very light to moderate assessment of the impact of HR initiatives on business results through standard reports and spreadsheets. Twenty-four percent of such organizations indicated they are not doing this type of measurement at all. Just a quarter of companies with 2,500 employees or more had implemented workforce analytics software.

On the other hand, the study found growing interest in workforce analytics. Thirty-five percent of companies with 2,500 employees or more are in the process of implementing analytics software, making it the top category among 12 types of HR-related applications. And, the study found, 30 percent of companies with 2,500 employees or more indicated they will make significant investments in analytics software during the next three years.

One firm dipping its toe into workforce analytics applications is Dallas-based software company Intervoice, which employs about 800 people worldwide and whose products include software for contact centers. Intervoice recently began using a dashboard within SAP’s E-Recruiting software. Among the tools available to the Intervoice staffing team are a summary of job applications waiting to be processed and links for recruiters to schedule interviews, says Don Brown, senior vice president of human resources at Intervoice.

Brown has higher aspirations still. He’d like to configure his SAP software to create an improved dashboard for line managers. Already, his manager self-service portal includes open job requisitions, employee birthdays and service anniversary dates. He wants to add such information as year-to-date turnover, talent development goals and progress toward them, and performance reviews ranked by score and linked to summaries. “We can justify the funding,” he says, “but we can’t do everything at once.”

Product categories
Analyzing workforce data may be as complex as finding the most important factors in store profitability or as simple as generating a companywide breakdown of employees by age. Firms sometimes rely on their existing spreadsheet software to tackle the easiest of these tasks. More sophisticated application tools, though, can cost large organizations hundreds of thousands of dollars.

Analysis results can be presented in reports sent by e-mail or posted on a Web page. In some cases, the conclusions also can be seen on computer-screen dashboards that quickly signal whether a particular figure exceeds an acceptable level—say, annual turnover above 10 percent. Dashboards and scorecards, which differ slightly from dashboards by measuring progress toward a particular goal, often broadcast the status of a particular metric with a green light for “OK,” a yellow for “caution” and a red for “trouble.”

Besides slicing and dicing workforce data and presenting the information back to users, analytics tools can fire off e-mail alerts to employees when danger levels are reached.

Sellers of workforce analytics products divide roughly into three categories. The first is comprehensive business software providers such as Oracle and SAP. The second is talent management specialists including Taleo or Authoria. Then there are stand-alone analysis applications from vendors such as Cognos and Infohrm.

Lawson Software is an example of the first group. Like SAP and Oracle, Lawson makes software to automate various business areas including human resources, finance and manufacturing. Lawson, which is based in based in St. Paul, Minnesota, says its Lawson Business Intelligence software allows companies to peer across multiple areas of the business to come up with useful information.

Cecile Alper-Leroux, Lawson’s director for human capital management product strategy, cites hiring metrics as an example. She says Lawson Business Intelligence goes beyond simply measuring the time it takes to hire someone to consider the effectiveness of the hire—seen through figures such as total cost of the employee, how quickly the person became productive and how successful they were in performance reviews. “That’s a much more complex view,” she says.

Oracle also boasts of workforce analytics software that spans the typical “silos” of information in a company. It sells analytics tools for both its Oracle E-Business Suite and PeopleSoft Enterprise product lines, and is working to “embed” analytics in individual product modules. For example, its Oracle iRecruitment application is set up so managers who are asked to approve an offer letter to a new hire automatically see the range of salaries given to employees with similar jobs, says Gretchen Alarcon, Oracle vice president for human capital management product strategy.

Alarcon concedes that vendors specializing in talent management applications such as recruiting or compensation software may allow users to drill more deeply into the information presented in reports or alert e-mails. But she argues that the specialists’ products often lack the ability to compare data from different areas, which is a priority for customers. “Rather than getting into super-detail in any one type of product, they want to see how their learning management, performance management and recruiting data tie together to meet their business goals,” Alarcon says.

Adam Miller, chief executive of talent management software firm Cornerstone OnDemand, agrees that vendors need to provide a range of applications in order for analytics tools to result in the most useful information. But Miller, whose firm offers software for performance management, succession planning, compliance management and compensation planning, takes issue with the idea that the big business software players have an edge in analytics and dashboard tools. “In virtually every case, it’s much easier to configure, navigate and report in our system,” he says.

Also in the mix are companies that focus on analytics tools alone. These include “business intelligence” software makers Cognos and Business Objects, both of which make tools for analyzing a range of business information, including workforce data. Another analysis specialist is Infohrm, which focuses on HR and talent management matters.

Brian Kelly, vice president of sales and marketing at Infohrm, says his product will gather data from a variety of sources in an organization. But a key part of Infohrm’s pitch is its willingness to consult with customers about how to use metrics effectively in their management style. “It’s not a technology issue at companies,” Kelly says. “It’s a change management issue.”

Companies have been banging on Infohrm’s door. The firm has seen revenue grow more than 35 percent annually over the past three years, and clients include such big names as Starbucks, Nokia and Time Warner. Other vendors of workforce analytics software report growing interest in their products as well. “It gets talked about a lot,” says David Ludlow, SAP’s vice president of product management for human capital management applications.

On the other hand, Ludlow says relatively few organizations have actually put analytics tools and dashboards into place to glean wisdom about their talent. Among the challenges to greater use of analytics is that many companies still make decisions about things like succession planning and performance management on paper or in spreadsheets, where data is hard to retrieve, he says. “You can’t have analysis unless you automate these processes,” he says.

Another obstacle to the adoption of workforce analysis software is that the tools aren’t always easy to use. Authoria, for example, offers clients a variety of “pre-baked” reports designed to be simple to access and comprehend. One such report, intended to aid in succession planning, plots out employees on a grid showing both performance rating and potential. But using Authoria’s software to ask more complex questions takes sophistication, such as understanding how to construct a multi-variable search.

An example of such a search would be an attempt to find, for a given job family, all the employees and external candidates who meet criteria around current location, willingness to relocate, length of service and performance record. Cooper says HR “super users” and other champions of the tool are the ones likely to do such ad-hoc digging, which can lead to important insights. “Yes, it requires some understanding to create a complex, multi-variable search from scratch,” Cooper says. “And rightfully so.”

Vendors of analytics tools also must overcome some residual distrust, says Jim Holincheck, analyst with research firm Gartner. He says vendors haven’t always done enough to help organizations get the right data in front of the right people, whether they are the HR director, CFO or chief executive. “Different stakeholders need different metrics,” Holincheck says. “The vendors haven’t really delivered on that.”

Along these lines, Lawson is working on specific role-based dashboards, such as ones for compensation analysts or recruiting managers. But the company’s Alper-Leroux says there is a limit to the effectiveness of “canned” reports and dashboards. She says Lawson delivers about 275 preconfigured reports, but the nuances of every business mean clients almost invariably want to build their own metrics. “More than 50 percent of our customers use 25 or fewer of those reports out of the box,” she says.

Some analysts, though, question the wisdom of HR departments in choosing how to analyze their talent management data. “If HR leaders don’t know what to do as a result of the metrics, then having them doesn’t matter,” says Naomi Bloom, managing partner at Bloom & Wallace, a consulting firm in Fort Myers, Florida. “The missing piece is the business savvy.

Early results
Infohrm’s Kelly says clients thus far have focused on very basic data chores. “You’d be amazed how many companies struggle to get an accurate headcount figure,” he says.

There was a flurry of activity around workforce analytics about five years ago, followed by a lull and now growing attention to the topic, Kelly says. He expects that attention to continue, in part because case studies of early adopters are persuasive.

In one example, a large retail client of Infohrm analyzed its data to determine that the greatest factor in store revenue and profitability was manager tenure. That sort of insight allowed the firm to do more to hold on to its store managers, Kelly says. “They know which levers to move,” he says.

Holincheck says interest in analytics will follow the course of companies’ now-common adoption of recruiting, performance management, learning management and compensation management software. “We’re where talent management was three to four years ago,” he says. “It’s going to be a mainstream thing that people are interested in.”

In other words, it soon may be as normal to have a dashboard in front of you at work as it is to have one in front of you while driving there.

Source: Workforce.com

Tools help staff see the effects of effort

By SAM HISER

Securing the services of the best available candidates is at the heart of e-recruitment systems. But once the new recruits are on board, technology now plays a big part in helping to monitor, incentivise and manage them.

Performance management software tools are maturing, taking advantage of the internet and replacing custom-grown solutions to help managers more effectively monitor and offer incentives to staff.

Also known as business intelligence (BI) or business performance management (BPM), e-performance management is a growing field.

Oracle, through its Peoplesoft and Hyperion acquisitions, SAP, Cognos and Business Objects are some of the big software providers helping managers collect, organise and massage data coming in from across finance, back office, manufacturing, production, sales and compensation business processes.

A growing list of smaller players, too, provides targeted services in a variety of niches. In the sales performance management (SPM) arena, for example, sales personnel and managers need a clear view of objectives and sales plan rules. They also need real-time visibility on their compensation statements and incentive goal sheets as well as
performance comparisons versus prior periods.

A dashboard screen on a desktop, laptop or smartphone allows them to absorb this information by showing up-to-the minute sales and compensation statistics and integrates incentive plan information.

In any sales organisation where the compensation plan drives the business, there is a need for everybody to be connected to central goals and respond quickly.

“You want to turn the business rules into compensation. With a centralized book, you can cascade strategic changes in the call plan,” says Leslie Stretch, senior vice-president of global sales, marketing and on-demand business at Callidus Software. The implications penetrate to the bottom line.

Mr Stretch says integrated software permits incentive compensation to be awarded faster and targeted with precision, while slowness and inaccuracy can demoralise a sales force.

Callidus, for example, is establishing a de facto standard for sales performance it calls the “true performance index”, that a professional can use to monitor the effects of their efforts. They can take this statistic with them – possibly to different employers. For heavily unionised customers, such as telecoms companies, Mr Stretch reports
fewer disputes, due partly, he claims, to trust in the Callidus data.

E-performance management tools are making a difference in operations management, too. A UK software and consulting group, eg Solutions, offers straightforward technology and advice which seeks to identify processes and tasks, assign roles, groups, teams and skills, and match desired outcomes with human activity. The business-intelligence
gathering mechanism is embedded in the process, which means data input is not segregated from the work itself.

Elizabeth Gooch, eg’s chief executive, says: “It’s like driving a car, first in manual and then in automatic.” The key is to make people autonomous optimisers by showing them the results of what they do.

Employees are said to appreciate sharper e-performance management tools and thrive because they feel a greater sense of accomplishment when their efforts are connected with results.

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The Friendly Face of Business Software

By Sarah Lacy

Last fall, AMR Research analyst Bruce Richardson was sitting on a couch in San Francisco’s Moscone Center during one of Salesforce.com’s many customer conferences thinking about the phenomenon the software company had become. As a scrappy upstart, it took the industry by storm, offering a cheaper and easier to install program to manage sales teams.

Dancing in Richardson’s head was a conversation he just had with the chief information officer of a large industrial company who was planning to ditch Salesforce.com’s (CRM ) software for one of the market leaders, Oracle (ORCL ) or SAP (SAP ). But when he ran into a chatty conference attendee from the same company, he asked her about the CIO’s plans. “Over my dead body,” she exclaimed. It was fierce loyalty unlike anything Richardson had encountered in his 26 years covering business software. In fact, it was downright Apple-esque, he says (see BW, 9/19/05, “An eBay for Business Software”).

Such fierce user loyalty may be the first spoils in a growing design renaissance in business software. The feature wars are over. The new software upstarts have a powerful one-two punch: cheap startup costs and drop-dead ease of use. While much of the attention in the software industry has focused on inexpensive applications that undercut pricey traditional business programs, it’s the new design movement that could prove more important. In fact, it could end up reshaping the user experience across Corporate America.

THE GEEK FACTOR. Forget what the corporate IT department thinks about business software. The actual users will tell you programs like those offered by Salesforce.com may be the first truly intuitive pieces of business software they’ve ever used. “My mom could pick this up in about three or four minutes,” says Chris Corcoran, CEO of Sunset Companies. He’s a customer of NetSuite, another on-demand company that’s getting ready for an Initial Public Offering this year (see BW, 2/13/06, “Giving the Boss the Big Picture”). “Most salespeople will tell you to take their right arm before you take away Salesforce.com,” jokes Kim Niederman, senior vice-president of worldwide sales for Polycom, a Salesforce customer.

To really appreciate the change, consider just how frustrated the buyers of business software had been. Companies spent buckets of money in up-front costs, and then more dough getting that software to work. Even more galling for tech managers is the reality that a lot of people outside of, say, the accounting department, never bother to use the products because they’re too geeky and complicated.

That’s why two big software movements have been gaining steam. The first is on-demand computing, where companies such as Salesforce run the program for the customer, selling use of it over the Internet for a monthly fee. The other big trend is the open-source software movement, where vast communities of coders collaborate to build software that’s freely available online.

POSITIVE IMPRESSIONS. It’s not that all of those open-source contributors are great designers. The key to the appeal is the try-it-before-you-buy-it nature of the open-source movement. When the software works and it’s easy, it catches on fast within companies and quickly builds a grassroots following. Increasingly, open-source designers understand that their audience is counting on them to develop easy-to-use programs.

Take customer relationship management company SugarCRM. It even seeks to provide some entertainment with different “skins” it offers for its interface. Sales people can log client meetings and organize contacts against a backdrop of palm trees or a golf green. “It seems a little silly at first, but they smile the first time they see our application,” says Clint Oram, co-founder of SugarCRM. “That’s an important first impression.” (See BW Online, 10/3/06, “Open Source: Now It’s an Ecosystem.”)

Good design is becoming more than a nice-to-have feature. Thanks to slick Web sites like Amazon.com, people are coming to expect software that takes no or little training to use. In fact, Salesforce’s first prototype bore an intentional resemblance to Amazon.com. The only difference: The tabs were changed from categories such as “Books” and “DVDs” to things like “Contacts” and “Sales Leads.” Says Parker Harris, Salesforce’s co-founder: “We want to get a toe-hold, and once people start using us, we know they’re going to like it. That’s our secret sauce.”

TALENT SHORTAGE. It shouldn’t come as a big surprise that on-demand software is focused on the user experience. The down side of letting customers pay by the month is that they can more easily switch to a rival. So on-demand software providers have to keep their customers happy with uncluttered, user friendly designs that, at least for now, the old guard can’t match.

“SAP and Oracle may be the standards, but if you get something that works, people will hold onto it forever,” Richardson says. Security software company IronPort Systems is one of several who tried to switch from Salesforce and faced a full-on revolt from the rank and file. “We’re stuck,” says CEO Scott Weiss.

That’s a good news/bad news scenario for usability companies such as Adaptive Path in San Francisco. Jesse James Garrett, director of user-experience strategy at Adaptive Path, says his business is booming and it’s near impossible to find good freelancers to bring in to meet all the demand. If they haven’t taken jobs at Google (GOOG ) or Yahoo (YHOO ), they have taken jobs with the new software up and comers.

ALWAYS EVOLVING. A lot of these are consumer-oriented Web sites, but just as many are Web applications aimed at businesses. The talent pool of good designers is getting so dry that venture-capital firm Sierra Ventures has hired Adaptive Path on retainer to consult with startups on usability and design before they even write a line of code — a big departure from the way software is usually crafted.

It’s not just a greater focus on usability. Companies like Salesforce and NetSuite have a natural advantage. Since they host the software, they can track every mouse click, just as an e-commerce site can watch how shoppers navigate the virtual aisles. So user feedback is almost instantaneous. If people are getting stuck, companies can make real-time changes to the site. It’s like the entire user base is in a real time usability lab. “We actually host companies’ Web stores, so we learn how great Web stores work,” says Evan Goldberg founder and chief technology officer of NetSuite.

Such constant tweaking — largely invisible to customers — represents another major difference in the way software is made and maintained. Traditional software companies do one big release every few years, and the upgrades are time-consuming and expensive. Hosted software is more an eternal work in progress. It’s continually updated, based on traditional focus groups and on watching how people use the software.

ADVANTAGE: SMALL FRY. That kind of direct connection struck Todd McKinnon immediately when he became vice-president of development for Salesforce.com. He previously worked for PeopleSoft, now part of Oracle — a company known for its good user interfaces. “At PeopleSoft we couldn’t get a release out in two years,” he says. “Here, we do it every four months, and a day later it’s being used by hundreds of thousands of people.”

Adds usability guru Garrett: “The big guys just handed this advantage to the smaller players.” And, as the overbooked calendars of usability experts show, scrappy upstarts aim to make the most of it.

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