The market for HR Software and Tools is estimated to be around 14 billion USD and growing every year with double digits. Every day more tools and innovations in HR enter the market driving disruption and change in this business-critical field. Most of the time these innovations however do not originate from the traditional HR Systems. Despite the consolidation in the market where HR Systems are snatching up smaller specialized tools, they cannot compete with the innovation speed provided by all these start-ups in performance management, assessments and artificial intelligence. That’s why connectivity is becoming increasingly important, connecting innovation to core HR in a seamless workflow.
Larger employers too often are operating on a different speed when compared to the disruptors and are looking with some jealousy at the agility of the market. They are often caught in long-term contracts and cost optimization processes that result in an HR Infrastructure that is lacking by today’s market standards. Changing to a new HR Infrastructure can easily take a year or more, resulting in a status quo for a number of years after that. This makes it hard to adjust to market needs and developments. There is practically no room for experiment. Application processes can be rusty, cumbersome, if not outright awkward. Candidates and employees will experience it as HR No-Man’s Land. Recruiters and HR practitioners will experience it as gutted. There is no love or innovation in the process, but it is so hard to change.
What if we could be in a different place where we marry business continuity with agility to deliver a process that is in sync with the market today?
Large employers tend to be large companies or governments that also have a responsibility that fits their size. They are expected to work with long-term scenarios and mitigate risks with opportunity. Change takes longer since more people are affected and is more complex due to its scale. I get that. Large employers are successful in dealing with this challenge when they have a long-term view on talent and define core HR processes, but at the same time embrace the experiment. I call the experiment a small bet. Innovation has an adaptation curve. If you always wait for innovation to mature and have a slower adaptation speed than others, you will lose out in the long-term compared to your smaller, more agile competitors. This obviously holds true for more than just HR. Employers have an opportunity to work with HR trends sooner if they scale down the complexity and limit the risk. They can do this by identifying proof-of-concepts with new HR technology and tools in specific parts of the organization before rolling out across the larger organization.
When HR teams have the mandate and budget to experiment in small-bets and this is made into a repetitive process, also larger employers can bring back the love in their HR Infrastructure. The continuous cycle would then be to identify trends, define an experiment, evaluate, and do this on an ongoing basis. If the experiment is successful, it will be rolled-out. If the experiment does not deliver the desired results, the project is stopped. This is fundamentally different from the current process where there are no experiments, but there is only adaptation of mature (meaning less innovative) concepts that deliver hardly any opportunity for a relative gain against your peers.
My advice to all employers struggling with a perceived trade-off between continuity and innovation, is to find continuity in core HR and add small bets in new innovations. Allow yourself to be surprised by the unprecedented amount of innovation available in HR technology today and benefit from it before it is old news. Don’t allow your HR System to be ‘gutted’. Your candidates, your co-workers in HR and your hiring managers will thank you for it!