Paradigm Paralysis in HR Technology, Part 2

article by Dr. John Sullivan and Master Burnett

In last week’s article, we introduced the concept of paradigm paralysis and discussed at a high level how existing HR technology “solutions” have become more of a barrier to next-generation staffing processes than an enabler, which technology has always been considered.

This week, we would like to turn our attention to proposing some simple guidelines to help organizations use technology more effectively to support next-generation staffing systems. However, before we launch into prescriptions, we would like to take a moment to share with you some of the response last week’s article garnered.

ERE Readers Chime in

Regardless of what we write we always expect that somewhere, someone will find fault with what was written and disagree with us. When we submitted last week’s article, we expected nothing different. In fact, we fully expected that by the time us West Coasters woke up, turned on our computers, and synchronized our e-mail, that we would have an inbox’s full of mail from vendors on the East Coast.

To our surprise, not a single disagreement has been raised. E-mails came in; posts we’re submitted; and even a few of you called. All in all, when we cut and pasted your words into Microsoft Word, more than 27 pages of comments were received. Some were words of thanks; others requests for recommendations; and the most valued were stories of success and failure. While we would love to share all of what you submitted, that would make for a very long Monday morning read! Instead, we would like to share some of the highlights that caught our attention. They include:

“We need to have the right philosophy, vision, and foresight but then we need the team to execute it!”

A. Ayerst

The Irvine Company

“These software companies are barely profitable ? none can assume the price of innovation: slower acceptance and lost revenue in the short term. None have real recruiting practitioners on their product design teams, and none of these companies are able to attract top software-design talent.”

D. Boylan

Avature

“I have not seen a single ATS that comes close to providing what ACT or Goldmine provide, let alone PC Recruiter or the CAPS systems (MRI centric). Clearly recruiters are more like sales professionals than HR professionals (This is not a knock against HR, just an acknowledgment that we are different.)

Who would want or suggest CRM tools that only tracked the customers who called you for a quote?”

J. Poirot

ADVO

“We (here at TiVo) continue to face the challenge of not having an integrated tool that can handle not only all types of workforce needs (temp, contractor, full-time etc.), but also enable us to manage the relationship as it changes from contact to vendor/employee as well as equip us to manage that vital communication link. In addition, there has been a proliferation of startups and companies changing their business models ? this drives the demand for flexibility which is not being delivered by the present cadre of solution providers. So we continue to use disparate systems which take more time…and time is an enemy.”

W. Uranga

TiVo

“Implementing HR or HR Staffing software generally doesn’t make someone a hero, and likewise it shouldn’t take a heroic effort to pull it off. However, as senior leaders do expect more from HR in supporting the strategic objectives of the organization, many na?vely look to technology and system integration as the cure-all.

Without question the technology has stalled in delivering diminishing returns on process efficiency and cost reduction, in many cases. Moving data, integrating systems, developing metrics, and improving processes across functions is at the heart of every technology solution and easy by comparison with changing the organization’s behavior.

Innovation isn’t dead inside the vendor walls; it simply has little application in a world so desiring of integrated ‘value,’ yet so resistant to change.”

M. George

VURV

Our Response

Nearly everyone who responded to last week’s article offered some bit of wisdom that we found of value, but the surprise response came in the form of a nicely articulated post by Michael George of Vurv (scroll down below the article).

From all that was said, it is clear that both vendors and consumers of HR technology recognize that we as a profession have a problem. In a traditional 12-step program (think we’re addicted to administration) the next step would be to accept that a power greater than any individual can restore order (think market forces). Nearly every solution that exists, while wildly efficient, is not effective at enabling next-generation staffing systems. Economic markets have changed. The world is once again flat, and that requires more from staffing than the administrative processes left over from the industrial age can provide.

Article Continues Below

Over-stressed and over-scoped HR professionals must accept that technology by itself is never a solution, but rather a component of a solution. For this reason and this reason alone, vendors are not solely to blame for the current state of technology to support the staffing function. Vendors have delivered what market conditions would allow. As was stated last week, the blame for where we are today lies equally on everyone’s shoulders.

Corporate staffing leaders have focused on administration and incremental efficiency gains while ignoring the effectiveness of their systems at contributing to business objectives. Staffing leaders must begin architecting a new breed of staffing systems ? one cognizant of the labor-needs of a modern organization and designed from the ground up to contribute to the top line of the organization. With new models in mind, staffing leaders must look to technologists to enable those systems, and recruit the funding to pay for the innovation needed. The business case will be made on contribution, not cost efficiency.

Moving Forward, Jumping on the Effectiveness Bandwagon

Those who see the train coming recognize that the problem we face is a big one. It’s a problem that if not addressed quickly could render our organizations lame in a battle for global market dominance or survival. Unfortunately, few in our profession see the train coming, and even some of those who do see it coming lack the motivation to get off the tracks. Michael George (scroll down below the article) said it best when he wrote “so desiring of integrated ‘value,’ yet so resistant to change.”

For years HR professionals have slipped through the cracks. Individuals no more qualified to operate the deep fryer at McDonald’s have worked as recruiters. Now the long-term effects of such malfeasance are evident and corporate leaders are worried. In response, more and more functional leaders are being tapped from outside the HR function to lead the function. Today we need a new cadre of staffing leaders: folks concerned less with efficiency and more with effectiveness.

If you, like many staffing organizations, are ready to abandon the past and embrace the future, consider the following points of guidance:

  1. Technology by itself is not the answer. Complicated tasks are completed by developing systems. Systems are made up of processes, policies, procedures, etc. Enabling next generations staffing systems requires that staffing organizations:

    a. Clearly understand the product lifecycle and product roadmap for the organization.

    b. Be capable of translating strategic plans into functional workforce plans.

    c. Coordinate staffing processes to drive a real-time supply of requisite labor on a global basis (regardless of labor type).

  2. Start with an understanding of what decisions/actions you need to enable, and what data is needed and in what form to accomplish that. Most staffing professionals start with a list of what features they want, not what decisions or actions they need. Mapping decisions and actions can dramatically improve the schema of data needed and dramatically simplify your technology needs.
  3. Impact of speed is dramatic. Historically it was OK for organizations to react to staffing needs because production cycles were significantly longer than they are today. Some modern organizations have products with lifecycles measured in days versus years. A slow time-to-hire can cost organizations millions in lost revenue by delaying product teams pushing products to market.
  4. Labor markets have changed. In an employer-driven market organizations can rely on staffing processes that focus on candidates coming to them. However, in employee driven markets, organizations must be adept at finding, communicating, and selling opportunities to candidates. We are now and will be for some time in a global employee driven market.
  5. Candidate visibility has changed. Historically organizations needed candidates to self-identify themselves because they were not visible to the organization. That simply isn’t the case any more. Nearly every individual of working age with an education in this world is profiled in one database or another, including those professionals in third-world countries Staffing systems must be redesigned to track candidates who do not approach you, but that have been identified through other channels of candidate visibility. To requite Mr. Poirot, “who would want or suggest CRM tools that only tracked the customers that called you for a quote.”
  6. Major solution-providers are strapped. While it would be nice to be able to lean on existing vendors to drive the future, the truth is that most of the major players are saddled with client obligations they already can’t meet. While most have enough cash flow to stay in business, they are dependent upon new customer acquisition to fund old customer maintenance. In a sense, they are living paycheck to paycheck.
  7. Current staff is a barrier. It’s easy to like someone, and to allow that feeling to impact one’s decision about the suitability of someone for a job, but current market conditions dictate that competence in the staffing function be elevated to a new level. Folks who routinely fight change or question the need for change must go. Consider replacing old-world staffing professionals with professionals from finance, sales, and marketing who accept the need to be analytical, to sell, and position employment as a product.
  8. Start small and build later. We know it’s not what you want, but unfortunately it is what works. Make use of a workforce plan, select technology to impact what drives top-line growth, and then market that success to secure funds and expand the scope of technology that supports next generation systems. Do away with the RFP that includes a feature set full of features your people will never use and instead focus on a few key features.
  9. Select technology to enable your process, not technology that dictates process. Despite the integration of leading-edge workflow management components into staffing technology, most offerings continue to force changes in your processes. Do not settle for solutions that force you to compromise, or pay through the nose for the vendor to compromise through customization. Design your staffing systems and then meet with IT professionals outside the HR function to determine where and how technology can be leveraged. Chances are, if you work in a medium-size to large organization, your company may already have enterprise licenses to technology that can support customer-centric next generation systems Don’t be surprised when you find out you’re sharing software with the sales organization!
  10. Stop forcing candidates to experience your administration. Today’s corporate employment sites are a mess. Most are little more than an overly generic front-end designed to get candidates to administer their own data entry. They are admin-centric, and do not provide value to the candidate Next-generation staffing systems must restore the corporate employment site to the status of a sales and marketing tool. They must become content rich. If your staffing system cannot provide a front-end experience that is consistent with the candidate experience, you need to provide consider working with a developer to develop your own front end. In a matter of days, a developer can leverage existing content management and data management technology that gives you real-time publishing power and retains the functionality to capture data that can be pushed into the backend solutions you experience.
  11. Bind your vendors through implementation. I cannot say that vendors intentionally set out to defraud customers, but it is clear that many customers think so. In reality, I think it is far more likely that HR technology sales professionals lack the scope of experience needed to understand the complexity of each customer’s needs, and that their organizations lack a motivational framework to insure that lack of scope is balanced with determination, honesty, and customer service. Regardless, most implementations of HR technology result in ill will and in some cases broken careers. While many customers seem satisfied with the sales process, note that I didn’t say overjoyed; they detest the implementation process. Sales agreements need to be restructured so that the sale is conditional upon the satisfaction of several pre-defined implementation elements. Extending the conclusion point of the sales cycle will force the extension of customer service and increase the financial motivation of vendors to improve the execution of implementation. This will also dramatically reduce the number of customers that purchase solutions which they later find out can’t do what they want when it comes down to implementation.
  12. Hire a pro. We accept that you probably know your organization better than an outsider, but it is unlikely that you understand more about technology than a systems professional. Don’t hire an HR consultancy; they specialize in selling you antiquated HR technology, instead hire a real systems architect ? one who knows what modern technology can and cannot do, and can create a seamless solution from multiple components that may or may not come from the HR applications market. You might just find that the service you have been paying $100,000 for could have been built internally for $10,000.

Conclusion

We mentioned earlier that the points of guidance would be relatively simple. Hopefully they are simple enough to encourage action. We could fill hundreds of pages with detailed instructions, but then we would be driving the innovation instead of allowing the market to do so. The future of HR technology is around the corner, but before we can get there, we need staffing system designs that meet the needs of modern organizations and take into account current market conditions. Whatever systems you envision, we assure you the technology exists to enable them. It may not be easy, and it may not be cheap, but when you start taking advantage of technology to meet business objectives instead of automating administration, you will become a corporate hero.

Dr. John Sullivan, professor, author, corporate speaker, and advisor, is an internationally known HR thought-leader from the Silicon Valley who specializes in providing bold and high-business-impact talent management solutions.

He’s a prolific author with over 900 articles and 10 books covering all areas of talent management. He has written over a dozen white papers, conducted over 50 webinars, dozens of workshops, and he has been featured in over 35 videos. He is an engaging corporate speaker who has excited audiences at over 300 corporations/ organizations in 30 countries on all six continents. His ideas have appeared in every major business source including the Wall Street Journal, Fortune, BusinessWeek, Fast Company, CFO, Inc., NY Times, SmartMoney, USA Today, HBR, and the Financial Times. In addition, he writes for the WSJ Experts column. He has been interviewed on CNN and the CBS and ABC nightly news, NPR, as well many local TV and radio outlets. Fast Company called him the "Michael Jordan of Hiring," Staffing.org called him “the father of HR metrics,” and SHRM called him “One of the industry's most respected strategists." He was selected among HR’s “Top 10 Leading Thinkers” and he was ranked No. 8 among the top 25 online influencers in talent management. He served as the Chief Talent Officer of Agilent Technologies, the HP spinoff with 43,000 employees, and he was the CEO of the Business Development Center, a minority business consulting firm in Bakersfield, California. He is currently a Professor of Management at San Francisco State (1982 – present). His articles can be found all over the Internet and on his popular website www.drjohnsullivan.com and on staging.ere.net. He lives in Pacifica, California.

 

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6 Comments on “Paradigm Paralysis in HR Technology, Part 2

  1. Reading this article, I am reminded of the numerous ERP implementations I have seen or heard about over the years. Anyone with extensive experience in ERP knows that the software solution chosen is less important than the implementation of said software. I have listened time and again to IT Directors, CIO’s and other C-level executives moan with regret over ERP solutions that were only partially implemented. This usually happens for one of two reasons; the company’s business needs didn’t align perfectly enough to suit everyone, or to save costs by implementing only the modules viewed as absolutely needed.

    As a Staffing Consultant I have used several ATS solutions and, not surprisingly, found the same to be true for those situations. Where the ATS was fully implemented and utilized by all involved, productivity and quality were dramatically higher (and far easier to achieve) than at the companies that used a mixture of conventional patch-work applications to fill in where the ATS was not utilized.

    I know I would prefer my next consulting assignment to be at a company that has fully embraced an ATS. Which ATS I don’t really care, they all pretty much do the same thing. Or as they used to say back at the dawn of the Digital Age, GIGO – Garbage In, Garbage Out.

  2. Another spot-on article by Dr. Sullivan.

    When the War for Talent is primarily waged over the Internet, major corporations will succeed or fail as a result of recruiting technology. Sounds too strong? I don’t believe this point can be made strongly enough. To that end, talent departments need talent software blueprints and guidelines.

    Companies need the ability to rapidly implement best-of-breed technology components into a unified solution. Companies that do will gain significant, strategic competitive advantages in the War for Talent. When a superior piece of talent technology hits the market, companies must have the ability to implement that component quickly, in a plug-and-play type fashion, with little custom programming.

    For example, when an advanced CRM tool hits the market, replacing an entire ATS is not a solution. Existing users, managers and vendors would be up in arms if they were required to completely learn a new ATS every time a better CRM, candidate mining, resume extraction or manager-self-service feature was implemented.

    At Valero, our technology guidelines mandate that all talent software meet the following criteria: communicate through XML, have a published API (application programming interface) and meet WSA (Web Services Architectural) standards. To the non-technical this means that all Internet-based talent software components, regardless of the vendor, can be quickly assembled together into a single talent solution.

    These guidelines ensure that we as users are not slave to single vendor offerings. This also creates recruiting technology component competition so that the vendors are compelled to keep their components up to state-of-the-art technology standards.

    Regardless of ATS and talent product vendor claims, run fast and far away unless they will guarantee in writing that their products meet these simple three criteria. If they don?t, you and your department will end-up with non-integrated, disparate pieces of outdated technology in two years while your industry competitors are using their state-of-the-art plug-and-play technology to bury you and your company in the War for Talent.

  3. To add to the new paradigm discussion, one recruiting director mentioned the true partnership with a client/ATS vendor (or any vendor): Treat your vendor as you would want to be treated or how you would treat a top candidate you’re trying to woo. Do clients not ‘oversell’ and promise the world to those passive, much sought-after candidates much like ATS vendors promising many more features to be released soon? Sure, that’s part of the courtship on both sides.

    As an implementation consultant, my job is to paint the honest picture and assist the company in determining show-stopper features versus actual return. The clients need to continue to dream. ATS vendors need to be profitable and to have a platform that is flexible, but a solid CRM. Hey, a shot at Goldmine and ACT! — As a user, you discover the limits soon after installing the CD.

  4. Re: D. Boylan

    ‘These software companies are barely profitable ‘

    TA systems alone are a billion dollar business in 2007-2008, so what of the whole TM universe ? Peoplesoft alone makes money by the pallet, and I know many firms in the biz with very pleasing margins.

    ‘none can assume the price of innovation: slower acceptance and lost revenue in the short term.’

    Is that something to do with HR software? That’s the essence of business decisions, anywhere at any time.

    ‘None have real recruiting practitioners on their product design teams,’

    Is that supposed to hurt? Client and prospect driven design saves all kinds of time, and who needs the filter anyway ? Does Boeing have a lot of airline executives on staff ? I’m pretty sure they listen very, very carefully to what they have to say, but today, engineers and project people can talk to customers via IM, email, skype, VoIP, WebEx, and on and on. Software can and is baked to order and it’s finished when the vendor is.

    ‘and none of these companies are able to attract top software-design talent.’

    I’ll stake our best players against anyone. You want top talent, anywhere, anytime, for any reason ? Pay for it, and you will have it.

    Lots of firms cry poor mouth and blame weak design on lack of subject expertise and say they cant afford to innovate and say they can only get medium talent….

    True for some….hardly for most or all….

    Re: Dan Hilbert

    I love the approach and the results speak for themselves.

    ‘At Valero, our technology guidelines mandate that all talent software meet the following criteria: communicate through XML, have a published API (application programming interface) and meet WSA (Web Services Architectural) standards.’

    It’s important to note the codicil; Dan has access to resources who can help him with an API, XML, and Web Services. Valero makes the investment in skills that leverage whatever solutions they select- making individual selection decisions much less risky and more rewarding. Note that all three options may not be needed for a given solution- for example, realtime access to raw data is often the only thing needed for a complete integration.

    This fits right down the line with Dr. Sullivan’s #12 suggestion-

    ‘Hire a pro. ~~~~~~~ You might just find that the service you have been paying $100,000 for could have been built internally for $10,000.’

    Thats the most radical thing I’ve read in a long time on ERE.

  5. Total TM vendors or just ATS ?

    Active Recruitment or Outsourced/Non-active ?

    Size of workforce ? Hourly, Pro, Interim ?

    Features per Dollar ?

    Hassle per Dollar ?

    Market Share only ?

    Innovation ?

    Reputation ?

    Share / Stake holder Performance ?

    There are at least 5 possible vendors for every dimension of the question.

    The best ATS is one you know how to use, that lets you move data in and out, and is popular with your fellow users.

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