By Hans Mangelschots - Business Manager HR Tech Valley
Organizations who are working on their resilience are catching up on their digital developments. Working remote and remote talent management has made HR Tech a popular and supportive asset in becoming more flexible while maintaining or optimizing productivity. This flexibility and productivity often exceed the processes or domains being supported and the market is responding accordingly. Customer personas get clouded. IT and operations step in. It fastens the decision-making process, but that is just one part of a successful strategic implementation. HR threatens to be forgotten in the decision-making process, hence needs to step up and show leadership to be included. This got me concerned.
Only HR knows and can point out the strategic value HR Tech enables; on top of the support it offers. IT Operations knows a thing or two about sustainable innovation. Together, they could create a flexible environment that enables people and productivity to thrive.
Clouded customer personas
The innovative technological solutions provided by new and experienced companies have become a shared interest. But who is buying? Who decides? Who is providing? Who is paying? Why?
From a marketing perspective, answering these questions is not always easy for new solutions when entering the market, it is not even easy for experienced providers with contemporary changing organizations.
Logically, technology that provides solutions for HR challenges, tries to convince HR and HR Services of its value.
For as far as Talent Acquisition goes, this seems to be a successful approach. Many organizations have outsourced that process and the agencies that are doing it have embraced technology to create a unique selling proposition.
For internal HR processes it seems that it is not always HR that is in the lead or at least takes the final decision to start using a certain technology. Because it is technology IT Operations often must be involved and (also) convinced of the return on investment. Practically many of these technologies help operations in optimizing workflows and automating processes too.
Ergo, most technology aims to convince the level of approval (decision making unit) to use their product. The rule here is the higher the amount being charged, the higher the level of approval.
HR has a small budget: Licensing was long seen as the way to give HR low budget access to sufficient IT support. Today an “on demand” offer is taking over many business plans, hereby lowering the levels of approval.
IT Operations have a bigger budget: Also, here was licensing a model that was new, especially since the evolution to cloud development. Integrating an API, IP as a service or white labelled use is often only for those organizations who already have a decent infrastructure and team, it is also more expensive.
As said, finding out these levels is not always easy. I.e., when organizations say they do not have an HR department anymore, but nearly gave it another name to focus on the soft part, after digitizing the hard part. Their focus went on the soft part of HR and they created an innovation department instead, leaving the technology and analytics to IT. Hereby giving IT Operations the lead for technological decisions.
As we all encourage innovation, the consequence of this approach is that customer personas are becoming clouded and HR Technology tends to brand itself an innovative supportive asset, instead of the strategic enabler it can be.
Now, not a bad word about IT Operations, yet when it comes to HR Technology as an enabler of the organizations’ strategy, it just seems best to also have HR involved. Not just one department.
A digital solution cannot solve any problems when it does not have enough revenue, but an organization can tackle all its challenges by using it within the right strategy and the right people.
Market Response – Deja Vu
HR is waking up, realizing they might have found the goose with the golden eggs when they embrace digital HR and the leadership that comes with it. Hence, the HR Tech Market is adjusting to their needs AND their budget i.e. by offering “on demand” solutions.
IT Operations is also aware of this evolution and the potential change in future decision making. New practices with new business models that could take over the support function without implementation efforts are often easy to use and difficult to manage.
Yet instead of joining hands and step into the HR Tech Community together, each seem to be trying to win the golden-egg-goose for themselves or at least ensuring an indispensable role.
The HR Tech Market has grown huge, diverse, and spread all over the globe. HR Tech communities are a great way to connect with key stakeholders and thrive business for new practices and new business models, with each other and with potential clients or investors.
IT Operations have always found it difficult to interact with HR, and so today the multibillion-dollar HR Tech market is finally drawing the attention of the General Tech organizations. These are now putting HR Tech in the spotlight for their audience, which traditionally does not consist of HR managers but of investors, CIOs, CMO’s, Operation and Innovation managers, etc.
It is striking that now, when there is a solution for every challenge within HR, for every budget, for every form of infrastructure, these organizations show interest in HR technology again. After years of focus on Fintech and Marketing Technology, it is finally time for HR Technology.
Hereby they enhance the market dynamics that were initiated years ago by HR Tech organizations like HR Tech Valley. Ironically, HR Tech organizations started creating awareness on the evolution of HR Tech just because of the lack of interest in the past from the previously mentioned.
People talk about resilience and a paradigm shift. But what if the paradigm was just shifting and this evolution tends to put it back?
In the early days, for many General Tech organizations who provide support the acceleration of operations and business, HR Technology often was neglected because the target audience did not exist of HR executives or HR was not (yet) considered as a primordial process to be digitized or optimized.
Moreover, in organizations every decision made about HR technology happened with consent of IT Operations. HR was often treated as a “user” by its own organization and was barely involved with the decision of purchase. Let alone were the employees, the actual users.
That is why Yammer never really worked. You know, the Social Enterprise Platform of Microsoft, acquired for $1.2B in 2012. Microsoft even offers it for free… but without strategy or input from HR it still is completely useless.
That is why a spreadsheet is still around after 40 years. There is not one company that is not working with spreadsheets. If there is proof that technology can impact human behavior it is the fact that people automatically think in rows and columns when categorizing input.
That is why experts developed new solutions called HR Technology and created a +500-Billion-dollar market over a timeframe of nearly 20 years. Many startups initiated their adventure from challenge they turned into an opportunity, which actually is a euphemism for turning frustration into entrepreneurship. Check the Benelux HR Tech Map.
In the past and in this current evolution, HR threatens to be forgotten in the decision-making process and the narrow perspective of HR Technology as just supportive tooling is enhanced.
If HR does not step up for itself, all strategic knowledge of HR will be neglected. As a consequence HR Technology will never step up to its strategic potential and history will repeat itself again. Leaving organizations with unused tools, terabytes of useless data in the cloud this time and -if they are still standing- a massive delay in true sustainable innovation towards Strategic Workforce Management.
Then what is innovation today? Asking the question is already a part of the answer, as you must start with strategy. Define what is meant and what goals need to be achieved, for what purpose and in what way, with what core values and how these reflect on the entire strategy. It is not a one-hour brainstorm, I can assure.
Furthermore, innovation as itself has several definitions. They are either all true or all false, in any way innovation is about doing something new or doing something old in a new way, yet both with a better outcome then before.
Three misunderstandings about innovation in my opinion are: