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Hosts Stacey Harris and John Sumser discuss important news and topics in recruiting and HR technology. Listen live every Thursday at 7AM Pacific – 10AM Eastern, or catch up on full episodes with transcriptions here.

HR Tech Weekly

Episode: 55
Air Date: January 28, 2016


This Week

This week John and Stacey discuss:

  • SAP/SuccessFactors Passes 1,000 Employee Central Customer Milestone Link
  • Most large companies will hire Chief Data Officer by 2019: Gartner Link
  • Mattress Firm to Host National Career Day in 40 Cities Link
  • Internet Of Things (IoT) Predictions From Forrester, Machina Research, WEF, Gartner, IDC Link
  • Topics: #DataSecurity, #IOT, HR’s role in coordinating work efforts

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 7AM Pacific – 10AM Eastern, or catch up on full episodes with transcriptions here.

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Begin Transcript

John Sumser:                        Good morning and welcome to HR Tech weekly where the leprechauns dance every Thursday morning. This is one step closer with Stacey Harris and John Sumser. How are you Stacey?

Stacey Harris:                        I’m good this morning John I’m good. I’m home which is always nice, I haven’t been traveling as much as you have been and lots of fun stories to talk about so we’re, I think, having a good conversation today.

John Sumser:                        Are you snowed in?

Stacey Harris:                        I am not. All of our, for the most part, all of our snow has melted. We have a little bit of ice on the porch that I almost tripped on because I have absolutely no ability to balance on anything that has ice on it. Other than that we’re pretty good, everything else has warmed up, so I will take that here. It’s a nice way to get snow, have it for three days and then it’s gone.

John Sumser:                        Yep. Yeah the only thing better would be two days.

Stacey Harris:                        Yes, exactly. Like to see it come down it’s nice to have one day of snow day, maybe two, after that I would like to have some nice warm weather. We’re getting back to warm weather finally I think.

John Sumser:                        Good, good, so what’s in Stacey’s mail bag?

Stacey Harris:                        Well, there’s not a ton of industry news per se, there’s some interesting stuff, SAP announced that they have passed 1000 customers. I think we can talk a little bit about what customers mean in the cloud [inaudible 00:01:38] environment so that’s worth maybe a few minutes of chatting about. There was an interesting article put on the need for chief data officers and me and you have been talking about data and what it means for organizations for quite some time so that would be an interesting conversation today. There was a Mattress Firm organization hosting a national career day in 40 cities, there’s some fun stuff to talk about that. Which is what constitutes the next generation of, I think of career days and what does that look like in an environment where Mattress Firm’s can tout what they’re doing and become really interesting.

Then we have a lot of conversation about things like internet of things, there’s some articles on that. The Lyft issue was settled with their possible lawsuit with their employees/drivers, so there’s some conversation there, and some administration labor plan survey plans going on that’s talking about on demand workers and on demand jobs. It’s a full bag today, so where do you want to start?

John Sumser:                        Oh, let’s just go and talk about the way the vendors are describing the growth of installations in the Cloud. SAP soars past 1,000 success factors installations. What do you think about that?

Stacey Harris:                        I got the same article you did and I was chuckling over the soars as well. There’s a difference between customers who have bought a technology and customers who have implemented it. When we were talking to them, I think it was in November, the numbers were around 830. Again that wasn’t all installed and the numbers didn’t come out here at least I didn’t see in the article, any conversation about how many of them are live or not live. I think that’s a big conversation in whether or not an organization has gone live with a piece of technology. The 1,000 number seems to be this hill that everyone is trying to reach.

Oracle, I think reached it in December and then they had at the same time, I think one third live, but I could be wrong with that number so don’t hold me to it. That’s what I had in my notes. Workday’s been over 1,000 I think since December too. Again not all theirs live either. I was trying to get some numbers from them this week but I didn’t get a final answer on that. We know Ultimate has been live on a 1,000 or 3,000  I think organizations for quite some time. Those numbers I think … I’m not sure why they’re such a big, a big point for the vendors to hit. I think at some point they think that people will stop counting and maybe that’s the big conversation. When do we stop counting the number of customers they have in the cloud and start paying attention to size and complexity and what they’re planning to do in the next year or two. What do you think John? Do you think the numbers are worth the conversation?

John Sumser:                        Well, This sounds nonsensical to me so I’m going to say that Oracle, Workday, SAP, generally operate in the enterprise space and I’m going to say that’s companies with more than 5,000 employees. There are 18 or 20,000 of those. Then there’s the mid-market and there’s probably 75,000 companies that you’d call the mid-market who are bigger than 1,000 employees. These are back of the envelope numbers, but generally those are right so with Workday, Oracle and SAP each having  a 1,000 in a market of 20,000 companies, what that tells you is they adoption rate of the cloud is well under 20%. I don’t understand why they’d be dancing about that, that seems to be damning rather than really great news.

Then if you look at Ultimate who has more likely to have mid-market customers and they’re 3,000 is fractional so these are in my mind the reason they’re not talking about market shares. These are low market share numbers and if you viewed it as a market share analysis you would go, “What’s all the fuss about the cloud?” Right? This is an attempt to spin meager data into a bigger story. It’s an attempt to say, “Look 1,000 people are doing this so you should too, but somethings not right, somethings not right. Something’s happening with the cloud stuff that people are not talking about yet. I don’t know what it is, but these numbers raise my eyebrows rather than making me smile.

Stacey Harris:                        Well and I think when you look at just the data we got out of Saraceito this year, I mean we hit the 50% mark of organizations who said they had purchased a cloud based core HMS technology right, but only about 15 % of them were organizations that were over 10,000 and that was from our data set right, that generally has a larger group of large organizations, Ultimately over the next 12 months … I apologize, 30 % of them said that they had a cloud based core HMS but not all of them had a stand alone cloud based core HMS. In other words they might have had two or three other solutions too that were still on premise.

John Sumser:                        Right.

Stacey Harris:                        I was sort of intrigued by that, that this idea that everyone is sort of moving to the cloud as quickly as possible. I think the are moving, I don’t think we’re going to see this trend move backwards by any means but like you said, I don’t think it’s going to go quite as fast because I think it takes a lot more work than people are giving credit to, to make this transition, this transformation. Particularly if you’re a complex organization right?

John Sumser:                        Right and to sort of weave in the internet of things story here, there’s … Well actually, internet of things and the next bit which is the chief data officer story. There’s a serious, serious question associated with the cloud. People are distancing themselves, you don’t see a lot of writing about it, but the security experts that I spend time with just roll their eyes at the idea that you can have a secure cloud system currently. The methods available to hack cloud technology are extraordinary and different then anybody thinks. What I’m hearing is that the reason there’s a trade in smartphones on the black market is not because people want to steal out of your bank account but because there is access to the cloud through a stolen Iphone with a case from that you can’t get other ways. That the system is not engineered to prevent against that level of hacking, where somebody gets in with a password and then starts acting.

Stacey Harris:                        Well I think that’s the conversation isn’t it? That the cloud environments are as secure as any sort of on premise environment from that perspective. ON premise environment would also be just as vulnerable to an user right, having passwords that somehow they’ve accessed, correct?

John Sumser:                        Except the deal with the cloud is everything’s connected in the cloud. On premise things are not connected to everything all the time, right, it’s a single sign on kind of overlay rather than a deep integration. The cloud is about deeper integrations I think. [inaudible 00:09:58]

Stacey Harris:                        The internet of things conversation you were talking about because that was … I’ve been doing a lot of research on the internet of things, and we had an interesting article on the internet of things here that by the … well the numbers are sort of all over the place, but the consumer electronic show this year had over 900 companies out of 3,800 that said they had internet of things products. That’s usually a trend showing what’s happening and that’s been a trend growing for the last three years. The internet of things really is being run much more so on blue-tooth technology and RFID technology these days. Which that technology isn’t as secure in some cases as some of the cloud technology that we’ve been working with over the last 10 years wouldn’t you say?

John Sumser:                        I don’t really, I’m not competent to judge which is more or less secure and given the pace at which hackers gain systems I’m not sure it’s even an interesting way to think about it, I honestly just try to have a cyber insurance to not have problems with any situations. What does interest me is the fact that we’re making everything connectable increases the likelihood that people who have a nefarious interest are going to find out how to get in. I don’t know about you, but I have kids who are in the prime hacking years and they want to know how to break into stuff. [crosstalk 00:11:32]

Stacey Harris:                        We have nephews and sons who are all enjoying that without a doubt, yes.

John Sumser:                        The more opportunities to break into stuff that there are, the more breaking in will happen I think.

Stacey Harris:                        That brings up another conversation then, which is a conversation that I had with my older son who’s traveling these days. His expectation of the world, these days, almost nothing will be safe. That if information is out there it is information that will probably be accessible. The conversation isn’t as much about can you stop people from getting to your information or getting into information, but what is the process for when that happens. Right? Almost insurance against it to some extent, is that a different dialog do you think then what we’re talking about? Which is is it possible to secure everything in and internet of things world?

John Sumser:                        I have no idea. I imagine that this will be like everything else, the idea that there has never been an accounting system that you couldn’t embezzle from is what we’re talking about here. The better the accounting system the better the embezzler and if you want to make accounting systems more secure, you hire embezzlers to design them. That’s an ethic that we’re seeing. People aren’t going to want to live in a world where its assumed that the car’s going to crash and you’re going to die and so the question is how good is the hospital after the car accident. I can’t imagine it, that’s sort of a steam-punk future. I have a hard time imagining that a lot of people are looking forward to or imagining that that’s the world. I understand why young people would see it that way. I understand why young people would see it that way. [crosstalk 00:13:50] Maybe what we do when all of the jobs are automated, maybe what we do is spend our lives sending emails about getting our identities back after they’ve been stolen.

Stacey Harris:                        There you go.

John Sumser:                        It’s the new work.

Stacey Harris:                        That’s the new work, the opportunities are about managing risk not stopping risk. Well, that could definitely be, create some new jobs in the future. The other new jobs that I think are possibly going to be created based off of all this conversation is … Gartner says that by 2019 90% of all large companies are going to have a chief data officer. We’ve sort of been talking about the gloom and doom side a little bit of sort of the hacking and what happening with organizations and accessing the content and the data. If you have a data officer does that change your organization’s approach to managing data, thinking about data, and the value proposition and the risk of the information inside your organization.

We’ve been talking for a long time that HR might have it’s own API, you were talking about, I think a couple of conversations ago. What if each company had their own API’s and the data officers were not only talking about how I secure my data, but also how we start to think about selling people’s data or managing people’s data in different ways then we’ve ever been before. I was talking to a company about this the other day. They had a large database of information, they had never sort of thought about the value of that database of information. Data officers, are you running into them, chief data officers anywhere John?

John Sumser:                        I’m not running into chief data officers, but there are increasing numbers of people who are interested in the security issues and the data integration issues. I keep coming back to the Autodesk implementation with Qualtrics. Autodesk and Qualtrics have combined forces to have survey potential at every decision in the workflow and the Autodesk software is a complex thing with 30,000 decision points in this workflow. It’s a tool for building architectural design or the plot structure and animation in the contemporary films. It’s a very complicated tool with a lot of decisions you can make at each decision point. The opportunity to be surveyed exists and then the system decides based on your behavior and the right size of the statistical sample, whether or not to survey you. Because they don’t want to bury everybody in surveys.

That thing that says in the work the, “how are you doing?” stuff is integrated, that they, we call it engagement in HR, it isn’t really engagement, but it’s something about how is the work treating you. That question is an operations question as much as it’s an HR question. Part of what the chief data officer … It’s a long winded way of saying, part of what the chief data officer thing recognizes, is that the old categories about who’s in charge of what are starting to shift.  Because of all the data inside of it.

Stacey Harris:                        Yep, and who’s in charge of what, that was my question. What is the role of the CIO and what is the role of the HR leader if we have a chief data officer. What your saying is that’s going to be sort of a much broader conversation right? It’s the managers and the people who own their data, right?

John Sumser:                        Right, right, so the idea that what HR … I read somewhere and reacted very strong, someone put in front of me the idea that HR is in charge of productivity, improvement, collaboration, and general engagement of the workforce. I thought that was the most nonsensical thing I had ever heard. That HR’s job is productivity improvement? Nah, HR’s job is to teach people how and when to collaborate? Nah, and that engagement, you can understand why HR would measure engagement, would diagnose engagement, would recommend solutions to engagement problems, but HR is not in charge of engagement. That’s between the employee and the supervisor.

That thing, which is the CIO and the marketing people, and the HR people who are staff people, have commandeered decision making from the operational people, I think the chief data officer is kind of a move for the operational people to take that data back.

Stacey Harris:                        Well that will be interesting to see.

John Sumser:                        So there.

Stacey Harris:                        Yeah, no I … Because I’m one of those people who might of written an article at some point, somewhere, I’ve sure someone can attribute and article to me some where that says HR should own the heart and soul of the employees right? They should be thinking about engagement and they should be focusing on the value proposition that the company is giving to the employees. I think there is a big conversation there about what does operation own then if HR is owning those things? Right?

John Sumser:                        That’s right and you know the people in HR, the really interesting thing is, organizations have gotten so complicated that you have people like HR in charge of things that they’ve got no business being in charge of because they don’t understand the business generally. HR isn’t a place to understand the business in it’s complexity. If you understand the business in it’s complexity then you’re going to work in the business. HR is an administrative function on the sidelines, but there’s all this data and there’s all this extra work and all this stuff that people don’t have the time to do and it ends up in HR’s world. Now because we’re going to be able to integrate things back into the actual work, some of that role is going to decrease. Wow.

Stacey Harris:                        Well, and that I think is going to be the interesting conversation is, I had this conversation just yesterday with someone who runs compensation for a large non-profit organization here regionally. We were talking about the fact that as certain things are automated, many of the roles in HR were either going to be changing or shifting, particularly in the payroll space or the areas around HR generalists roles, that go across organizations. Her comment was, and I thought it was an interesting and insightful comment, was that as much as all of the administrative tasks within HR feel like they’re being automated, she said she’s finding it’s creating more work for her, because she’s the one person who’s at the center of a lot the conversations.

Although we’re sort of increasing the automation, what we’re doing is putting more work on that one person who understands how all the data comes together. That person only has so many hours in the day and they are a critical role I think, outside of operations right? Operations generally sees their area and only their area and HR is the one place where some of that stuff intersects. How do you take your conversation about the fact that operations has to own it, but if operations is focused on their business unit only, the person in the middle see so much more right?

John Sumser:                        Well, it’s a great question and our ability to understand and describe organizations is extremely limited, extremely primitive. We don’t really understand how organizations work. We don’t really understand except in physical ways what work is. We don’t really understand what makes people succeed and fail in their work. Although, you and I are engaged in research, where that’s part of the big question. What does it mean to have people work and how do they do on the job? That’s increasingly removed from the work itself and so what we’re learning, doesn’t really get integrated back into the work and the people who actually do the work are getting a little tired of creating the data that makes experts who boss them around.

It’s the Dilbert thing right? The boss comes around with data in his little check-sheet and asks you for the red stapler.

Stacey Harris:                        Poor red stapler.

John Sumser:                        Poor red stapler, poor red stapler. That’s the world that people live in on the factory floor is there are a 1,000 bosses who think they know what they’re doing who actually don’t do the work.

Stacey Harris:                        Sort of thinking about that, one of the articles you sent me what this Mattress Firm that’s hosting a national career day in 40 cities right? I was really interested in this Mattress Firm showing that not only were they doing a job search in 40 cities … There were quite a few roles they were increasing in their sales and marketing division, but they were offering comprehensive benefits packages, along with school reimbursements. Looking for candidates who were capable of expanding the idea of what they wanted to do and gain training. With that kind of hiring going on today, which is pretty amazing compared with where we were at 5 years ago.

Your comment about the fact that operations or the group of people are tired of having so many bosses, is that really just an outcome of the fact that we’ve been working so lean for so long though too? Now we’re starting to hire more people and you’ve got companies like this Mattress Firm doing this across the country now?

John Sumser:                        Well, I think you have some experience in an organization that has many locations, I think in those places where organizations have many, many locations, particularly in the low end of the hourly compensation range. That there are problems that you can’t solve locally any longer. I was talking with the Vice President of talent for a Louisiana based cable company the other day and she runs very complex hiring processes for 400 locations. In each of those 400 locations, she needs to understand labor supply, labor market, retention rates, all of those things vary in each one of those locations, You know all about this stuff.

Stacey Harris:                        Yeah, exactly yeah.

John Sumser:                        You can’t really manage the problem locally but the problem in the aggregate is horribly complicated and so we’re starting to see that in those organizations. Then there are these things, like I’m getting exposure to massive consulting organizations. Hundreds of thousands of people who are in conference calls on the airplane. Because there is no office for these companies. There is no home for the people who work in these companies. What we’re having to do in HR outside of all the arm waving that people like us do about it. What HR people are really having to do is solve problems that never existed before. I get excited about it because it’s a technology solution that’s going to be the answer.

Stacey Harris:                        I think they’re solving problems at [inaudible 00:27:07] but I also think the other side of it is that they’re trying to figure out, and I think this to your point, and this goes beyond an operational conversation but, they’re trying to figure out how to coordinate the work effort. Not manage the work efforts, not give the … Not own the engagement, not own the collaboration but they are trying to coordinate the work effort is what I would say is probably happening more often than not.

John Sumser:                        I think that’s right, I think that’s right, and I think that’s an amazing way of thinking about the problem that is not on the current conversation, which is do we centralize or do we create centers of excellence. Do we have business advocates out in the field or do we have all of the HR function at home? There’s this third way which is, bespoke offerings at each node in the distribution network that are coordinated from a central point. That’s, I think a third way of doing HR that the Dave Aldrich’s of the world don’t do. What a great conversation, we really moved through this one today. What a lot of fun.

Stacey Harris:                        We did, I think next week it might be fun to maybe take a look at the Lyft’s lawsuit settlement.

John Sumser:                        Oh yeah.

Stacey Harris:                        I think that’s well worth the conversation next week. As well as some plans for a new labor survey which I think everyone should be aware of, coming up. Because I think that’s going to give us a much different perspective on the on demand market then what we have today. A lot of stuff to talk about even for next week I think so we’ll see what happens.

John Sumser:                        Fantastic. It was great Stacey, thanks so much. I always love having our conversations on Thursday mornings and thanks everybody for listening today, we will see you again, same time next week. Bye Stacey.

Stacey Harris:                        Thanks everyone. Bye.

End Transcript

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