Despite the fact that this column is about choosing HR technology solutions, we’ll start by saying that nothing in it should be interpreted as a recommendation for any particular HR technology vendor. You are the expert in your environment and ultimately know who the “appropriate” HR technology vendor is for your particular circumstance. Before spending any substantial money on new workplace technology purchases, you should examine technology, service, cultural fit, analyst “rankings,” and even industry recognition for any given product as individual factors in a thorough decision process.
Having said that, this article will be one of those inputs—the one that reminds you that purchasing new technology involves more than just the “software.” Additionally, it frequently has less significance than the “non-software” facets of your collaboration with your HR technology suppliers.
Despite appearing large, the HR technology sector is actually quite small and somewhat exclusive. If you pay close attention to the market, you can’t help but observe how frequently HR technology specialists shift jobs and switch from one HR technology vendor to another. Very senior product leaders frequently transfer from one HR tech company to another, frequently a competitor, to take on leadership positions in product development or product strategy. Some of these accomplished, seasoned CEOs are working in their third or fourth distinct HR technology companies.
The transfer of this technical skill from one service provider to another, together with the more widely held belief that practically every brilliant concept in business is quickly replicated, combine to create a market that tends to converge on itself—while it is expanding at the edges. Most new innovations wind up being included into the basic or expected capabilities of Tier 1 and even Tier 2 providers, regardless of whether they originate from the start-up community or from well-established HR tech suppliers. Take the recent examples of employee earned wage access, internal gig or “opportunity” marketplaces, or AI-powered skills graphs or ontologies, which have all transformed from cutting-edge innovation status to largely mainstream capabilities in just a few short years.
Most firms—likely even yours—will create a list of necessary features for any new HR technology solution that is surprisingly similar to another organisation’s. The fundamental functions of any HR technology system will undoubtedly become more or less universally supported by almost all vendors over time, including detailed employee profiles, adaptable workflows to facilitate employee mobility, and even mobile device support for all critical HR employee or manager actions. If a supplier can’t cover the 80% of feature requirements that most enterprises will want, the HR IT market is too established, too competitive, and, as I indicated above, too derivative for most of them to exist for very long.
Some providers—particularly the more established, “enterprise”-sized ones—will have access to more features and applications than newer or smaller ones. And it’s also true that a lot of the new start-ups will supply some distinctive skills that the incumbent suppliers haven’t (yet) duplicated, cloned, or gotten their hands on. However, the fundamental differences in functionality across suppliers are fewer than we frequently believe, and in my opinion shouldn’t be the deciding factor when evaluating new HR technology. Although capability is crucial, it is not the only aspect to consider.
The “wars” over product features therefore never stop and frequently produce no winners, in his opinion. The quality of customer service and support, care and commitment to customer success, and dedication to customers and their community, which are much more difficult to imitate than software features, would be what would genuinely be a distinction for both the supplier and the customer. Finally the customer success and service divisions had the same number of employees and funding as their major development group. It is believed that their approach set them apart from competitors in the HR IT sector and was what influenced their clients’ decisions to buy from them or renew their subscriptions.