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CHICAGO—More than 40 percent of organizations hope to improve or develop a new enterprise HR systems strategy this year, according to the results of the 2016-2017 HR Systems Survey, unveiled Oct. 5 at the Human Resource Executive HR Technology Conference & Exposition.
"Technology conversations have shifted to relationships—not a 'features and functions' conversation," said Stacey Harris, vice president of research and analytics for Alpharetta, Ga.-based Sierra-Cedar, an independent North American IT services company, to a packed crowd at the conference. She said the new nonnegotiables are user experience, a tailored relationship and roadmap strategies.
HR is seeing a shift in its role from administrator to service provider, Harris said. That means HR needs to be thoughtful and strategic about how it deploys its services.
The survey was conducted from May 12 through July 11. More than 1,528 respondents representing a total workforce of 20.6 million employees and contingent workers participated in the survey.
The survey report authors said the key themes in this year's survey were creating strategy, using HR tech in the cloud and embracing organizational culture.
"Without an enterprise strategy for the HR technology [structure], organizations are finding that they not only spend more on total HR technology expenditures per employee, but they also reduce the overall number of employees they can serve per HR resource," wrote the survey report authors. "Strategy is both a key component when it comes to a technology environment and a significant opportunity for many organizations," the survey said, revealing that "30 percent of organizations have regularly updated their [enterprise HR systems strategy], while another 25 percent have [a strategy] in development; this is similar to last year's findings."
Harris said that part of developing an enterprise HR systems strategy is working through current and future state HR technology plans. Large businesses usually attempt to transform their technology environments by strategizing first, then creating a more modern architecture that can support mobile access, new user experiences and full data analysis requirements, the report stated.
Organizations with higher-than-average HR technology adoption in the administrative, service delivery and workforce management applications saw nearly double the revenue per employee and a 12 percent increase in their overall HR, talent and business outcome metrics, Harris said. These organizations were also 75 percent more likely to be viewed as strategic partners by their business leaders and 10 times more likely to be in the top 10 percent of organizations when it comes to social responsibility initiatives, she said.
Rethinking How and Why Technology Is Used
The researchers suggest that companies are rethinking their perception of technology investments: "Historically, technology was viewed as a capital investment that would increase efficiencies and reduce total HR costs, with implementations viewed as temporary setbacks with fixed project timelines. In today's [cloud-based] environments, organizations have removed overall capital investments and changed finite projects into continuous change management models. More importantly, organizations pay more for their new [cloud-based] technologies; however, they also reap greater talent and business outcomes from improved decision making across their organization" the report states.
Harris said job seekers are increasingly looking for organizations that are transparent and trustworthy, in the same way they crowd-source information before making major purchasing decisions. The researchers said they've seen an increase in both regulations and news concerning issues on diversity, employee engagement, pay equity and leave policies.
"Both employees and contingent workers around the globe have higher expectations of their employers and want constant access to their own employee data and want to navigate these new social responsibility expectations."
Use of the cloud is increasing—not just for HR but for other areas like marketing and finance, Harris told attendees. There has been a 25 percent increase in companies assessing cloud solutions for non-HR technology and an increase in large company plans to integrate HR and non-HR technologies into their environments. Most are questioning cost, security and long-term value for a complete cloud solution within the next year.
Companies are planning to spend money on new systems, too. Each year, Sierra-Cedar asks organizations to identify whether their HR technology spending plans will increase, decrease or stay the same. Just 42 percent of organizations believed their spending will increase in 2016-17, while 7 percent felt their spending would decrease.
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