Telania Intelligence Report: Human Resources
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2 Contents Introduction... 2 Why You Should Read This Report... 2 State of the Human Resources Software Market... 3 Research Findings... 4 Recommendations... 9 HR Software Products... 9 How to Use the Information in this Report Telania Simple. Innovative. Trusted
3 Telania Intelligence Report: Human Resources Introduction Why You Should Read This Report Whether you call it Human Resources, Talent Management, Human Capital Management, or any number of other terms and phrases, the systems you put in place to recruit, hire, onboard, compensate, track, train, and manage your employees from entrance to exit are all mission-critical elements to your company s success. Powerful HR technologies are available to streamline, automate, and optimize your HR efforts. In fact, there are hundreds of such products available, and sifting through the options to find what s right for your company can feel like a daunting task. But you don t have to start from scratch or go it alone, which is why you should read this report we ve done a big chunk of the legwork for you. This Telania Intelligence Report: Human Resources will guide you through the findings of our own research about the state of the HR technology landscape in companies today, make recommendations based on those findings, and provide information about some of the top HR software systems currently used by a variety of businesses and organizations. Armed with this information, you ll be several steps ahead of the curve in selecting the right software to meet your company s HR requirements. Getting ahead of the HR software curve is another great reason you should read this report. When faced with the huge array of choices in HR software, how do you go about narrowing down which packages might be right for your business? You want to know the bigger picture of the HR software market, what other companies are using and how satisfied they are with their choices. You ll find all of those topics covered in this report. To summarize, here are the top reasons why you should read this report: 2
4 Discover the state of the HR software market today. Find out what our own research shows in terms of the HR software market in real companies. Explore the top-rated HR software systems as rated by real users. Get ahead of the HR software curve. State of the Human Resources Software Market Josh Bersin, a contributing writer for Forbes magazine, noted that the talent management software market grew by 17% in 2013, and is now well over $5 billion in size. The message is loud and clear: Talent management is a key to success in the 21 st century, and that means integrated software solutions are needed by forward-looking companies to manage it all. The Holy Grail in this field is developing a single solution that helps rank-and-file employees to manage their work and those in supervisory roles to manage their people. It goes beyond traditional concepts of human resources and is quickly becoming an all-inclusive effort at a system of engagement for everyone involved in a company, including prospective employees. There are vendors who specialize in servicing large companies (SAP, Oracle, Workday) while others focus on mid-size and smaller companies (Halogen, Ultimate, ADP). Interestingly, this is a fairly firm dividing line because systems developed for large companies simply aren t as easy to implement or as affordable as those developed specifically for the smaller companies. Yes, there are vendors who are trying to do both, but the research is clear those vendors that focus on either one or the other are more successful. Talent management is a key to success in the 21 st century... It s a software market that changes very rapidly, which is why enterprise-level, fully integrated solutions are hard to come by. The largest systems simply can t keep up with the changes. That s why there will always be a range of smaller vendors with specific products meeting specific needs. Many of those do end up getting acquired by larger companies and folded into their systems, but the all-encompassing single solution remains elusive. The rapid pace of change in the talent management software market is largely driven by two forces continued evolution of learning management systems (LMS) and the explosion of social, mobile, and other online talent acquisition tools and platforms. A lot of companies have been limping along with legacy systems that were originally developed when the field was still dominated by paper. These companies are looking to replace those rigid systems with ones 3
5 that are more nimble, more agile, often cloud-based, and which offer more comprehensive features to address their end-to-end talent management needs. The upshot is that record investments were made in 2014 into talent management and HR software systems, a trend that continued throughout 2015 and will no doubt continue for years to come. In fact, the HR software market is forecast to be upwards of $9.2 billion by Research Findings Telania conducted a survey in which 135 HR professionals provided information about their use of HR software. The results offer an eye-opening glimpse into the current state of HR software deployment in a range of companies. Responding companies represented a range of sizes, with 38.5% being small (1-50 employees), 37.8% being medium-sized companies ( employees), and the remaining 23.7% being large companies (500+ employees). Figure 1. Size of Responding Companies What is the size of your company? 23.7% 37.8% 38.5% Small business (1-50 employees) Medium business ( employees) Large business (500+ employees) Perhaps the most surprising finding of the research is how many companies still rely on manual systems or a mix of manual and HR software systems. Note that manual systems can still make use of computer software in the form of generic apps like spreadsheets, but which do not count as specialized software. 4
6 Among the responding companies, 31.1% use only manual systems, 57% use a mix of manual and HR software systems, and only 11.9% exclusively use HR software systems. Figure 2. Types of HR Systems in Use at Responding Companies What kinds of systems does your company use for its HR function? Please choose only one response below: 12% 31% Only manual systems (note these can still make use of computer software, like spreadsheets, but not specialized HR software) A mix of manual systems and HR software 57% HR software only (no manual systems) Among those companies that use a mix of manual and HR software systems, the division between the two is relatively even, with 44% of the systems being manual and 56% being HR software. It s important to realize that among the 57% of responding companies that use a mix of manual and HR software system, nearly half of the systems used are manual. Figure 3. The Mix of Manual and HR Software Systems at Responding Companies Your company uses a mix of manual and software systems for HR. Please characterize that mix below by estimating the percentage of each: Percent of HR systems managed manually = Percent of HR systems managed with HR softtware = 5
7 Among those companies that do make use of HR software, slightly less than half (47.5%) use only one comprehensive HR software system while slightly more than half (52.5%) user more than one HR software system. Figure 4. Use of One HR Software System versus Multiple Systems Does your company use only one comprehensive HR Management Suite software system? Please choose only one response below: 53% 47% YES NO Table 1 below lists a number of different HR functions, what percent of responding companies use HR software for that function, and the names of the HR systems used, where the numbers in parentheses note how many times it was mentioned. Table 1. Percentage of Companies Using HR Software by Function and Names of Systems HR Function Percent of Companies Using HR Software HR Software Systems Used (with frequency of mention) Basic employee data: 86.2% BambooHR, AHI TechTime, GP, Realtime, UltiPro (2), Ultrastaff, Explorer (construction industry), Abra, Orion, ADP (4), Paylocity (2), Personnel Manager, EPPA, PeopleSoft (2), MS Access, Elucian Banner, Workday. Benefits administration: 72.4% BambooHR, BSwift, Ultrastaff, Explorer (construction industry), Employer Solutions, ADP (2), Benetrac, EPPA, PeopleSoft (2), Paycor, Paylocity, Elucian Banner, Workday. Compensation MGMT: 48.3% BambooHR, Explorer (construction industry), EPPA, PeopleSoft (2), Paycor, CompEase, Workday. Payroll: 93.1% SAGE, AHI TechTime, GP, Timesaver & Realtime, PlatinumPay, Kronos (5), UltiPro, Ultrastaff, 6
8 Explorer (construction industry), ADP (5), Employer Solutions, Orion, NFC, Paylocity (2), PeopleSoft (2), Paycor, Elucian Banner Recruitment: 51.7% BambooHR, Taleo (3), ApplicantPro, Talent Scout, UltiPro, Ultrastaff, BirdDog, icims, ExactHire, People Admin. Hiring: 51.7% BambooHR, Taleo (3), ApplicantPro, Talent Scout, UltiPro, Ultrastaff, BirdDog, icims, ExactHire, People Admin. Applicant tracking: 58.6% BambooHR, UltiPro, icims, ExactHire, People Admin. Talent management: 31.0% Cornerstone (2), Taleo (2). Performance MGMT: 41.4% Cornerstone (2), Reviewsnap, Towers Watson, PeopleSoft. 360-degree feedback: 34.5% Cornerstone (2), Reviewsnap, SurveyMonkey, PeopleSoft. Employee recognition: 31.0% (None mentioned) Performance appraisal: 41.4% Cornerstone (2), Reviewsnap, PerformancePro, Towers Watson, PeopleSoft. Training and Learning: 48.3% Cornerstone (2), CUNA CPDonline, Desire2learn, UltiPro, BVS (for banks), Towers Watson, Workday, Kronos. Course authoring: 20.7% Desire2learn Learning management: 31.0% Cornerstone (2), CUNA CPDonline, Desire2learn, UltiPro, Towers Watson. Onboarding: 31.0% BambooHR, Taleo (3), ApplicantPro, Talent Scout, UltiPro, Ultrastaff, BirdDog, icims, ExactHire, Workday. Attendance tracking: 51.7% Kronos (3), ADP (3), AssureForce, Heavy Job (construction industry), TimeStar, Employer Solutions, TimeClock Plus, PeopleSoft, Paycor. Employee scheduling: 44.8% Kronos (3), ADP (2), AssureForce, Explorer (construction industry), TimeStar, Employer Solutions. Expenses/billable hours: 24.1% Explorer (construction industry), Lawson, ACCPAC. Workforce management: 24.1% Kronos, Heavy Job (construction industry), ADP. Employee engagement: 24.1% UniFocus. Labor analytics: 24.1% BambooHR, RealView. But the real question is this: How happy are these companies with the software they re using for these different HR functions? Table 2 below gives those results, and it s an eye-opener: 7
9 Table 2. Satisfaction with HR Software Systems in Use HR Function % Unhappy w/ HR Software % Happy w/ HR Software Basic employee data: 32% 68% Benefits administration: 47% 53% Compensation MGMT: 59% 41% Payroll: 29% 71% Recruitment: 62% 38% Hiring: 59% 41% Applicant tracking: 62% 38% Talent management: 71% 29% Performance MGMT: 66% 34% 360-degree feedback: 77% 23% Employee recognition: 77% 23% Performance appraisal: 67% 33% Training and Learning: 47% 53% Course authoring: 63% 37% Learning management: 58% 42% Onboarding: 61% 39% Attendance tracking: 58% 43% Employee scheduling: 63% 37% Expenses/billable hours: 62% 38% Workforce management: 60% 40% Employee engagement: 70% 30% Labor analytics: 72% 28% It s interesting to note here that the only HR functions where substantially more than half of the responding companies are happy with their HR software include such basic functions as employee data, benefits administration, and payroll. The greatest levels of dissatisfaction with HR software includes such functions as 360-degree feedback, employee recognition, labor analytics, talent management, and employee engagement (all those areas show dissatisfaction of 70% or more at responding companies). Following close behind are such areas as performance appraisal, performance management, course authoring, employee scheduling, expenses/billable hours, applicant tracking, onboarding, and workforce management (with dissatisfaction levels between 60-67%) You might think that with such rampant dissatisfaction with their HR software, lots of companies would be considering making major new HR software purchases in the coming years, but that is not the case. Only 26.5% of responding companies plan to make a major purchase in the next two years. Among those planning on making a new purchase, Telania asked them what was driving the decision. The results are displayed in Table 3 below (note that respondents could select as many options as were applicable to them, which means percentages sum to greater than 100). As the results show, the primary drivers include better user interfaces to encourage use, better handling of performance management, and consolidating multiple systems. 8
10 Table 3. Drivers of the Decision to Purchase New HR Software Drivers of Purchase Decision Response % We need software with a better user interface so people 44.4% will actually use it Performance management is our biggest challenge and 44.4% we need better software for it We re looking to consolidate multiple systems into fewer 33.3% systems We need software with better Big Data capabilities 29.6% Talent is our biggest challenge and we need better 25.9% software to meet that challenge Our HR software is just getting old 22.2% Recommendations Based on the research findings, it s clear that more companies, especially smaller and mid-sized businesses, should be exploring HR software systems to replace those that are still managed manually. What s holding them back are probably an array of barriers, including sheer inertia, the daunting task of deciding what to try, being too busy to take the time to do it, and so on. What these companies fail to huge increases in efficiency and productivity [from] taking the plunge realize is the huge increases in efficiency and productivity that can be gained by taking the plunge into better HR software systems. Yes, it does take time and effort, and implementing a new system can seem like a thankless time-sink, but the pay-off will be significant enough to offset the pain involved. The other thing that s clear is how more companies need to take the time to explore the landscape of HR software systems in order to find the ones that will meet their needs. There s a lot of dissatisfaction out there with HR software, which is one of the reasons Telania publishes intelligence reports such as this one. Making the best-informed decision possible when it comes to choosing HR software systems is what Telania wants for you. Below you ll find out more about some of the systems available and what users think of them. HR Software Products More and more people and companies are taking advantage of business software review sites to let others know about their experiences in using different systems. This emerging niche is one that you can 9
11 leverage into better decision-making in HR software purchases. The problem is that there are already too many sites to choose from. However, you can relax because Telania has done the legwork for you. Drawing on ratings and reviews from five major review sites (namely SoftwareAdvice, Capterra, G2Crow, TrustRadius, and GetApp), below you ll find listings of major HR software systems and how they stack up by user ratings across multiple sites. Please note that systems which bill themselves as comprehensive will not be repeated in the listing of more function-specific systems. For the most part, those comprehensive systems are geared towards very large companies (and carry a large price tag as well). 1. Comprehensive HR Systems (they literally do it all) System Overall Rating out of 5 Stars Halogen TalentSpace 4.8 ClearCompany 4.7 Cornerstone OnDemand 4.2 ADP Vantage HCM 4.1 UltiPro 4.0 Workday 3.9 SuccessFactors 3.8 SilkRoad 3.8 PeopleSoft 3.5 Kronos Core HR Systems (not comprehensive, but cover a lot) System Overall Rating out of 5 Stars Paysavvy 4.8 Fuse Workforce Management 4.8 BambooHR 4.7 Namely 4.6 Dayforce 4.1 Zenefits 3.9 Paylocity 3.4 Paychex
12 3. Recruiting/Hiring/Applicant Tracking System Overall Rating out of 5 Stars Workable 4.8 BirdDogHR 4.8 JobAdder 4.8 icims 4.7 CATS 4.5 SmartRecruiters 4.3 LinkedIn Talent 4.3 JobDiva 4.3 JobScience 4.3 JobVite Performance MGMT/Appraisal/Feedback/Engagement System Overall Rating out of 5 Stars Quantum Workplace 4.9 Performance Pro 4.9 ActivTrak 4.8 Workboard 4.4 ReviewSnap Learning/Training Management System Overall Rating out of 5 Stars Lesson.ly 4.9 LearnCore 4.9 Grovo 4.7 BlueVolt 4.6 Brightspace 4.3 Quest Track 4 6. Labor/Workforce Management and Analytics Software Consolidated Deputy 5 Weekdone 5 Parim 5 Smarthub 5 Cronforce 4.9 When I Work 4.3 Zoho
13 How to Use the Information in this Report Now that you ve seen the research and the ratings, what do you do with all this information? It s useful at this point to take a step back and think about the bigger picture of buying new software systems. The most important thing you need to do before beginning to look at actual software system options is to make sure you ve done a thorough organizational needs assessment to know for sure exactly what you want any new software system to do for you. Prioritize your requirements and use the top three or four to quickly narrow down the list of options to a few finalists for deeper consideration. Before scheduling visits from vendors for demonstrations, this is a good time to take a look at several of the different business software review sites mentioned earlier. However, you need to know a few things before diving into them. First, several of the sites will offer you listings of the different systems by their level of popularity, which usually consists of the number of customers the company can boast, along with a few other metrics. Please realize that just because a software system is popular doesn t mean it s going to be the right system for you. And it doesn t even mean it s a good system! Pay attention to the user ratings and you ll see how even a popular system can fall short. You can also then dive into the user reviews to get more specific information from people who have been using the system to see if it should stay on your short list. Telania Simple. Innovative. Trusted. The mission of Telania, LLC is to provide software solutions that help businesses and nonprofits improve efficiency and productivity. We strive to do this with the highest levels of professionalism, customer service and cost effectiveness. A privately-held company based in Louisville, Kentucky, Telania, LLC was founded by Ghana native Don Weobong, who created the company s premier product eleap as a graduate student working on his thesis. Originally founded as DriverPack, Weobong incorporated in 2002 as Telania, LLC, named after his ancestral village in Ghana. To learn more about Telania and our products, visit 12
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