Hosts Stacey Harris and John Sumser discuss important news and topics in recruiting and HR technology. Listen live every Thursday at 8AM Pacific – 11AM Eastern, or catch up on full episodes here.
HR Tech Weekly
Episode: 43
Air Date: October 22, 2015
This Week
This week John and Stacey discuss:
- HR Tech Debrief
- Sierra-Cedar 2015–2016 HR Systems Survey
- Namely, new HCM
- Jibe walked away with honors at HR Tech Hackathon
- Greenhouse.io
- PeopleSoft
- CivilSoft
- ADP
- SAP
About HR Tech Weekly
Hosts Stacey Harris and John Sumser discuss important news and topics in recruiting and HR technology. Listen live every Thursday at 8AM Pacific – 11AM Eastern, or catch up on full episodes here.
- Subscribe in iTunes
- Downloadable MP3 File HR Tech Weekly: Episode 43: With Stacey Harris and John Sumser
Transcript
Begin transcript
John Sumser: Good morning and welcome to HR Tech Weekly, one step closer with Stacey Harris and John Sumser. Good morning Stacey how are you?
Stacey Harris: Good morning John, I’m awake and we’ve got a beautiful out here in Las Vegas, so can’t beat that. Although I think our audience will probably have to know that you and me both are losing our voice, hope they can bear with our scratchy voices this morning.
John Sumser: Oh you know what, it’s a result of having spent all that time at the annual HR Technology conference and if we didn’t do that, we wouldn’t be able to do the show. You had a great week this week. You did your annual presentation on the research that you do and it was a standing room only audience. The feedback that I’ve been seeing you got is extraordinary, congratulations.
Stacey Harris: Thank you John, thank you. I will have to say this is a very good week just purely for the fact that I, we got it out the door and we feel pretty good about the research. Because as everyone knows, the last few days are always stressful when you’re trying to launch that big project, like anyone else. Yeah, so we did the launch the annual HR systems survey for Sierra-Cedar this week at HRTech. At our presentation session on Wednesday, so yesterday. If anybody is interested in downloading it, they are more then welcome to, today it’s on the site.
I thought what was so exciting about this year, because this was my first year solo after taking on the work from what Lexi had done for the last 17 years, was how much people look forward to the research. I really do value the people who participate in the work because they really do keep coming back year over year and want to have an insight into what’s happening. We have great people. You know the other funny thing John, that I got multiple times when I was at the session. Many people mentioned how many times they were actually listening to the show that we’re doing here. It’s always good to hear feedback on what we’re doing here on a weekly basis, and I had several people come up to me and talk to me about the HR Tech Weekly show. So Kudos to both of us on the fact that we’re able to put this on each week, no matter what’s going on.
John Sumser: Yeah, it’s a great thing, so let me … actually I would recommend that anybody who can, try and figure out how to read the comments in your Facebook feed about the show. Particularly Natalie Blooms comments about how she for how she prepares for these things. Did you see that?
Stacey Harris: I did, yes I did. Yeah.
John Sumser: Yes, I highly recommend that you read it. So We both saw lots, and lots, and lots of people I know I had … when you go to this particular conference it is sort of like the industries homecoming weekend. Part of what happens is old connections get renewed and the industry tries to figure out how to embrace new entrants. One of the things that I saw that was very interesting to me was a company called Namely, which is an HCM piece of software and it’s positioning itself as the new thing that nobody’s ever done before. But they did do that was just astonishing is they bought every shred of media that you could buy in Las Vegas. On the in room television stations, Namely was every other ad. They bought their way into the hotel’s advertising stream and they were on top of taxi cabs. That was the first meeting that I had and I spent some time with them. They are bright, enthusiastic, well-funded, New York City based and that’s different. The New York City base is different.
There was also a Hackathon at this year’s technology conference and the people at Jibe walked away with all the awards for the Hackathon.
Stacey Harris: Yep,
John Sumser: We’re starting to have actual technologists in the room doing stuff at the conference. That’s a nice change and a big improvement I think.
Stacey Harris: Yeah, yeah, I actually … Yeah, I know I heard the Hackathon went very, very well and there was also a big focus on new vendors. There’s two new technology events, one was new, new vendors and one was existing vendors who had new solutions. I think there was definitely a feel this year that we’re all sort of waiting for the next thing. Now, I would say that we saw the next thing, but we are seeing the beginnings of what’s going to create it. It’s interesting that you mentioned John, the New York elements. There were many companies I saw, particularly in the interviews I was doing that were either in New York or outside the US trying to make their way into the US audience a little bit more tightly. I would say about half mine were either from the international community trying to make their way into the US audience or were sort of outside the Silicone Valley bubble.
One, and you might actually know about this. Greenhouse I’d met with and I was quite intrigued because I don’t follow the recruiting space as others do and I was interesting a bit more about what they were doing because I had heard so much about their recruiting processes and tools. I think they are New York based as well too aren’t they John? I know they have a group out in the bay area but they’re headquartered in New York I think, right.
John Sumser: They’re definitely a New York company, and let me see if I can tell you the difference between a New York and a San Francisco company is. San Francisco companies are more likely to imagine bigness as the destination and New York companies are more likely to imagine the next sale as the destination. My sense is that the non-Silicone Valley companies are significantly more service oriented.
Stacey Harris: Yep.
John Sumser: When I look at the universe, what I see is the beginnings of a really big conversation about what is software? What is proper to expect from a software vendor, and how do you buy this stuff? We are entering an era where those things are changing and probably changing more rapidly then it looks like when you go to a trade show like this.
Stacey Harris: I completely agree with you. The international component to me, as well as some of the more payroll centered systems that we know in the HR environment were all talking services. Were all talking relationships. We’ve been having that conversation for a long time but services are now becoming a bigger part of what people buy with this technology.
John Sumser: Yep, yep and at the very same time, big players like Workday are moving those services out into smaller focused companies like OneSource who do nothing but Workday implementations, and Workday just moves all that service work into their portfolio at OneSource.
Stacey Harris: Well that’s kind of the new role for system integrators I think in some direction. Those who can make the shift will be able to do it very well and those who can’t I think are going to struggle. The general conversation and even in our data this year and I thing the new implementation model, the new implementation staff environments right is using less and less third party, foreign implementation components, plus there’s not the big upgrade environments that general implementation and system integrator partners depended on. So really what’s it going to come down to is we want someone who can do more of a services wrapper around our work, so the implementations are smaller, the services are more robust, the ongoing upkeep and maintenance through the updates are being managed. That’s a lot of what OneSource does, and two, you can advise us and guide us on how to leverage all these various best practices inside these tools. That’s one of the number one things I heard from the larger vendors this week was, “we have so much more functionality in these new staff systems and we keep adding more and more, people forget about it.”
I heard that from Cornerstone in my interview with them and I heard that from the [inaudible 00:09:35] Team and I heard that from Employee central that the real issue for them is getting people to leverage the depth of the tools that they’re working in. So I think that’s going to be an interesting new role for many of these third party organizations.
John Sumser: Isn’t that an interesting thing? Doesn’t leveraging the new tools that we give them, doesn’t that mean we’ve created a bunch of stuff nobody uses?
Stacey Harris: Well, their take on it is that they’re seeing their clients buy things that are already, that their systems are capable of doing. I think that’s their take on it. Is that a lot of the new solutions out there, let me talk about some interesting new onboarding tools and some interesting new well-being and wellness tools this week with really neat mobile applications. Limeade was one of them and Park-let was another one, great tools, but I think many of the large vendors might say our system can do that if you know how to configure it appropriately. I’m not saying that’s the case because there is probably a lot more depth in each of those organizations with their individual tools, but that’s what I’m hearing at least.
John Sumser: Let me see if I can parson this out a little bit, because I think what you’re talking about is a place where the idea of SAS software which is sort of just hit a button and the updates happen. SO one gets new functionality by turning on your desktop in the morning and all of a sudden you have new functionality. Without training and thoughtful of redefinition of your job when you get this new software the new functionality is of no use. There isn’t anybody that I’ve met in the last forty years who goes to work in the morning and goes “Crap, I don’t have anything to do I better go see if I can take functionality in my software and make my job better.” That doesn’t happen, that’s not how that happens.
Stacey Harris: Yep.
John Sumser: What has to happen, my boss looks at what’s possible and says “Let’s talk about how you could do something bigger and better then what you’re doing right now, using the software you’ve got.” Then there’s some sort of process for imagining what that it is. When you don’t do extensive implementation, when you just roll the stuff out and how that people use it. That step, which was part and parcel of the big on-premise installation of consultants, just doesn’t happen.
Stacey Harris: It flops, yeah, and that might be the biggest thing happening with the SAS work right now is we’ve made the message about it’s easier, it’s simpler-
John Sumser: Yeah, we’ve made the message a lot about how inexpensive and simple it is to do this stuff … and my goodness Stacey, it seems that you have dropped off, there you go … so what I would talk about next is the great research that you’ve done and the way that research shows a couple of really interesting things.
The first interesting piece of the research is that you took a look at the top twenty or so products in the space and in those top twenty or so of those products you first looked at the befits on one side and the challenges on the other side of each of the pieces of software, Then you converted that data into thumbs up and thumbs down. The interesting story in there is the company with the highest ratio of thumbs up to thumbs down is drum roll, PeopleSoft.
Stacey Harris: Yeah.
John Sumser: That is a solid testament that the PeopleSoft brand is completely disconnected from user opinion. You’ve got this, you’ve got this buyer view and you’ve got this user experience and they don’t seem to have anything to do with each other. But you end up with PeopleSoft being the, for sort of shorthand, the most liked provider of software in the space and that’s an astonishing surprise. The other thing that came out of your research, that I think, I didn’t find anybody who was totally surprised by this but I thought pretty crazy that your research shows that there’s effectively no cost difference between an on-premise solution and a SAS solution. I swear Stacey, what I’ve been hearing over the years is that SAS is much less expensive and that’s why you don’t get so much ability to customize. Because a cheaper solution doesn’t have the capacity to customize. SO what do you think?
Stacey Harris: Yeah, those are I think, two very … let me caveat to that, you’re right, the pricing was, [inaudible 00:15:44] two years in a row. It’s very much time for the licencing and the outsourcing models and well as the SAS costs individually. What’s really interesting about that finding is that I’ve had both vendors and users come to me and say “I need to understand this, because it doesn’t feel like what I’m seeing is what everybody is talking about.” I think you’re right we’ve sort of hyped a bit and the hype needs to come down a bit for people to understand that these worlds are still probably, these vendors particularly have to make the same level of revenue and so they are figuring out that model for themselves right?
The other side of that picture is I think your point about what people like and what they don’t like and our thumbs up and thumbs down analyst. Those were the top three things that people liked or didn’t like. It was more about how well they liked what they liked, is a good way to put it. Which meant for PeopleSoft, if they were on PeopleSoft, 70% of them liked the fact that they could customize. That’s the biggest …everybody likes the same thing, we’re all on the same page, we know why we’re doing this type of conversation. I think for some of the other vendors there was a lot more “we’re not sure what’s driving why we like this.” It’s they had better user experiences in some cases, in some cases it’s better upgrades, some cases it’s the fact we’re happier with the content that they provide us, the industry expertise, it’s spread out a lot more.
I don’t know what the right answer there is, to whether or not you want to be very clear about your value proposition or whether or not you want to be sort of everything to everyone. But my sense is that those who are very clear about their propositions seem to have people who are more aligned with why they’re leveraging those tools, and what’s the value proposition is to their organization. That’s my take on it John, from my perspective.
John Sumser: Is what you just said that customer satisfaction is actually a function of how well you target your market?
Stacey Harris: Yeah. I would definitely say that’s true. Targeting your market, and we’re seeing this and I think this is across the board in all of it. Whether you’re HR management, talent management, or you’re one of the wellness programs or one of the tools dealing with … the newer fringe talent acquisition tools right now is, if you don’t know your market, if you try and get the everything to everyone, you end up diluting not only your message but you end up diluting your vendor satisfaction components. Where if you know your audience, those who really know who they’re targeting, go after them. Focus on them, the you’ll see those vendor satisfaction scores go up. I think a real great example of that is Ultimate and Ceridian, both of them got very high vendor satisfaction ratings this year and I think a good portion of why theirs has continued to move up over the last couple of years has been they have very strategically figured out who’s the audience they’re focusing.
In some cases moving of of their systems the larger organizations who they’ve decided is not in their sweet spot, while they’re focusing all their attention on the mid-market and smaller organizations as well. Does that make sense John, or is that to simplistic of a view of the market?
John Sumser: What I know for sure is that every single company that I’ve talked to in the market is really good at somethings and maybe not quite as good at other things. When they serve customers who are different then their core customer there is always going to be some dissidence in that service. It seems to me that the highest customer satisfaction scores are going to come from companies who are serving audience that are similar. I think that is more or less what you said. Yes?
Stacey Harris: Yeah, yeah, pretty much, yeah definitely. The other thing we saw this week John, which is probably worth noting is this influx of international organization. I don’t know how many you had on your radar. But I saw, and many of them on different platforms from what we’re used too. I had an opportunity to briefly meet with ran-co who is sort of an HR, MS payroll solution provider out of the Asian Pacific market. [inaudible 00:20:24] which is more of an HR organization that sits on top of the [inaudible 00:20:29] platform. Both of those organization it seems like the strength in them was their localization components. The fact that they could meet the needs of the small, medium and in some cases the larger organizations in the specific country that they were sort working on. Not so much the multi-national which is a much harder conversation, did you meet with a lot of international organizations trying to grow here, into the United States?
John Sumser: I did, I did. It seems to me that there are always several really bright shining stars, like Fairsail, coming from England. There are always a couple of bright shining stars coming from Australia. I met with a Dubai based HCM system called CivilSoft and they are coming to the United States and they think they’ve got the ability to do an extraordinary business in the energy industry. People are coming with some views that are pretty fascinating, One of the things that I think that is true is that American companies, looking at the American market don’t see the diversity of the American market, where somebody coming from Europe somewhere, with all that cultural diversity can’t imagine that the American market is a big monolithic monstrous thing. They end up being better at the kind of marketing roll out that requires targeting by geography then their American counterparts. It’s fun to see that happening.
Stacey Harris: Yeah.
John Sumser: I also thing the technology market in HR is exploding. I saw many, many more people who were talking about serving customers with fifty employees, and the problems associated with the failure rate of companies with fifty employees. You have a inherently lower renewal rate when you’re business features companies of fifty or fewer and so you need to be able to tell when to get out of those relationships in a much more acute way then with companies with 10,000 who can’t quit just because they want to.
Stacey Harris: That’s an interesting perspective. Yeah, in one of the other sessions and one of other organizations that are dealing with those very small organizations is Paycheck. Now Paycheck’s really hit the HR checks really hard this year and they haven’t in the past as much I would say. Many of them know the name and the brand, particularly for small business HR and payroll services. It’s funny I was having a conversation with them today and they were saying … well yesterday I guess, the days are blurring together for me at this point.
But their comment was in a nice and round about way, we’re not your old Paychecks, we’re not your parents Paychecks, right? It that they have really tried to sort of really update their approach to the market and their solutions as a whole. They’ve got a new flex platform that seems to be more robust, more mobile now and is able to scale to organizations of at least 1000 employees and a little above that now. Their comment on the ratio of what they have as far as organizations was like 80% was under the fifty employee mark. They’ve built their service chops is what they told me off of the fact that they were meeting the needs of these organizations that have such a wide range of issues at this small market space. What do you think of that? Do you think the needs of the small market are as complex sometimes, if you’re meeting multiple ones as they might be in the large scale?
John Sumser: Well actually it’s probably in some counter intuitive ways it’s probably more complex. Because the churn is great so you have to learn how to navigate the signals of failure, that’s the first thing. The second thing is that what’s true of very small companies is that while they are indeed very small so their alike in that way. They are all pursuing idiosyncratic views of the world and a small batch of customers relatively speaking. Their focuses are different, and handling customers with radically different focus is a scaling challenge, it’s really hard to get good at doing that.
You’re right, now I do want to say out loud that talking about Paychecks as a small company. [crosstalk 00:25:42] They do a couple of billion of dollars a year in business. They are one of the larger firms, it’s just when you compare them to ADP in particular, everything looks small. One of the things I wondered as I spoke to the people at ADP is, is if there is any company in our industry that you could tolerate comparing to ADP? ADP has nearly 500,000 customers.
Stacey Harris: Yeah.
John Sumser: I don’t even know how you make sense of that. When I spoke with the team at Paychecks I came away wondering how you deal with that level of complexity, but I’m going to guess that ADP is twenty times that size, thirty times that size?
Stacey Harris: Yeah.
John Sumser: I don’t even know what you call something that’s that big. It’s just monstrous, they own a quarter of payroll in the United States, which means 25% of the gross domestic product flows through their bank account every week. That’s wild.
Stacey Harris: Particularly for ADP the big differentiator, and they both know this, and they’re both willing to own it. Paychecks says they don’t plan to go into Multi-national is that ADP handles the multi-national organizations, and in some cases, better, I think, than anybody else in the market Right?
John Sumser: Right.
Stacey Harris: I mean it was just one of the reasons why, I mean they handle some of the most complex payroll environments I think anybody has in the market. Leveraging, in some cases, some of the tools from other organizations like SAP, but in a way with the services and the tools that I don’t think anybody else has been able to replicate. That’s their biggest differentiator and also their biggest challenge, right because you handle a complex environment your the group that is sort of leveraging you and using you is always somewhat frustrated because they’re dealing with very complex issues, right?
John Sumser: Right.
Stacey Harris: They have to deal with that on a service level that no one else probably has to. Yeah.
John Sumser: Yep, so look at this, in the midst of all overwhelm we’ve gone through another thirty minutes of great conversation about the HR Technology market and what’s happening this week. Anything you want to wrap up with before we go?
Stacey Harris: Well, I think two things, I think. One is that coming up next week is going to be HR Tech [inaudible 00:28:27] congress. So that I think is worth noting that they’re in Paris, I know there will be a lot of good insight there as well. We’re going to be launching some European data there, there’s going to be this international data. I think that’s going to be another event that’s will be interesting to hear about, when we hear the comments back from that. For the HR Tech congress here in Las Vegas I think most important to note that although me and you and all the analysts talk non-stop to the vendors while we’re here, because that’s the opportunity for us to all to get together, as you said, sort of a homecoming. It really is about the users, the event is. This year I believe the numbers were up, I didn’t hear the final numbers, you might know them John.
John Sumser: I don’t.
Stacey Harris: There were multiple people from all over the world there. I did talk to you about that, that they had people from father away then they ever had before, and a bigger amount of international communities come to the event. I heard some really wonderful comments about the event’s content itself this week. Including the panels, I know you did one John, and other panels that really talked about what was happening at a deep level. I think that’s important for people to note too, that this is a users conference. It’s a user conference that is sort of focusing on sort of their needs from the complexity perspective that’ we’ve been talking about.
John Sumser: That’s great. Thanks very much Stacey, it’s been a great show and we will see you all next week, same time I believe? Thanks for listening, thanks for being here Stacey and talk to you next week. Bye-bye now.
Stacey Harris: Thank you John, bye.
End transcript
