Jeitosa has just completed the preliminary analysis of Global Readiness Survey results. Some of the key findings include:

• Survey participants were asked what top three challenges they encountered in going global in the HR/HRIT function. The majority of respondents indicated cultural differences (53%) as the top external challenge they faced, followed by compliance with data privacy regulations (42%).

The good news is that there are solutions available for these challenges: leadership development, cultural awareness training, change management programs, and global communication plans can help individuals understand and appreciate cultural differences and provide tools and techniques for improving cross-cultural collaboration. Formalized strategies for dealing with data privacy challenges, particularly in dealing with the European Data Privacy Directive, can be developed and include approaches such as Safe Harbor, Model Contracts, and Corporate Binding Rules.

• The top internal challenges companies are facing in going global fall into two major categories: lack of technology and systems to support global initiatives (51%) and lack of experienced and culturally adept resources to work effectively in a global environment – both a lack of global leadership (47%) and a lack of sufficient other global resources (45%). Going global is a relatively new initiative for many companies, so it is not surprising that many would still be immature in these areas.

Solutions to these challenges are readily available, but organizations need to step up and realize that building a global infrastructure with global systems and global people takes effort, resources, budget, and time. More and more vendors are globalizing their product and service offerings making it now possible to source a global solution for HR systems. With the increased mobility and globalization of the workforce, it is also now possible to find experienced resources who understand first-hand the issues and challenges in designing and deploying a global solution.

• Working globally, companies are also experiencing some successes. By far, the greatest success they are finding is in developing and appreciating global diversity (68%). While this is a challenge for some, it is also a success for others. Generally, the more familiar one culture is with another, the greater the understanding and acceptance of the differences that exist.

You can download a copy of the preliminary research report by clicking here. The participate in the survey and receive a free, personalized copy of the full report, benchmarking your organization to others who have taken the survey, please click here.

I attended a conference on October 28-30^th, organised by the Workday company, called Workday Rising (that was two weeks ago, so they have no doubt risen some more by now). I was interested in looking at the product and the company to answer some questions and concerns I had, such as:

1. Can they establish trust in the On-Demand marketplace?
2. What is their marketing strategy in this highly competitive industry and is it sustainable?
3. Are they serious about going global?

Firstly, the On-Demand software marketplace is a new paradigm to many organisations and there needs to be a new level of trust with HR software suppliers: Not only do you need to trust the supplier to provide quality software applications but you need to trust them with your data.

In that respect Workday has no problem. The company is built around the personal credibility of Dave Duffield, the founder of PeopleSoft. Not only is Dave a marvellous human being, an honest family man, but a good bloke as well. But it is not a business that revolves around one man: From a succession viewpoint, he is supported by his son Mike who has inherited his father’s charismatic nature and business values when it comes to treating customers as important friends.

In order to understand the culture of a business it is important to see how they work. I had the opportunity to visit the Workday office at Walnut Creek, a short trip from the centre of San Francisco. The work environment is something that impresses you: The developers go about their business with not only a professional approach, but with a feeling of excitement at what they are doing and achieving. The other impressive feature is the admiration and dedication they have for Dave Duffield: They idolise him and he really has an inspired team.

Secondly, the marketing strategy: Workday pays a great deal of attention to their customers and really celebrate their success. But you cannot help noticing the amount of money it must be costing to maintain this marketing approach. The On-demand market will be savage. Some vendors will be giving away software free and the profit margins will be small. There needs to be a lean and competitive approach that focuses on volume of customers, rather than the acquisition of high profile organisations and great reference sites. They need to be innovative and apply the same initiative to their marketing strategy that they have applied to their technology. I am sure they understand that, but I don’t want to spoil the party in the meantime. That conference was great and there will be another one next year that promises to be even better. So I hope Dave doesn’t put away his wallet in the meantime.

Finally, are they serious about going global? I believe they are: They have a network of partners that are capable of helping the Workday company go global and a strategy to expand the reach of their product to Europe, South America and the Asia pacific region. It appears to only be a matter of time.

In this videocast, John Macy talks about On-Demand or Software-as-a-Service as the next, common sense, logical evolution of technology.

• In the traditional On-Premise environment, the client owns the infrastructure and licenses the application from the vendor. The client is responsible for all of the upfront costs and the ongoing maintenance and upgrades.

• In the new On-Demand world, the responsibility for looking after the infrastructure is passed to the supplier. There are no upfront software or hardware costs, rather the client pays for the service as it is used — pay-as-you-go approach.

There are two major benefits of the On-Demand model:

• Technology complexity is avoided by letting someone else take responsibility for the software and the technical infrastructure.

• Total Cost of Ownership is reduced because there is no major outlay for hardware or software and implementation time is drastically minimized.

On-Demand is way of the future because it avoids complexity, delivers the total cost of ownership that executives expect, and supports implementation and roll-out in far shorter timeframes than ever before.

One of the most interesting sessions at the HR Technology Conference this year was the 2007 HCM “battle” – or “shootout” – among Lawson, Oracle, and Workday. As I watched the vendors all flawlessly perform their well-scripted demos, I was impressed with how well all three met and exceeded the requirements Bill Kutik laid before them. When you think back to the fact that Oracle’s takeover of PeopleSoft was just three years ago and that Workday’s inception was a little over two years ago, you have to be in awe at how quickly and how far along the vendors have come – particularly Workday! To be able to effectively compete on stage, feature-function by feature-function, with vendors who have been around for decades, definitely says something about the architecture and toolset of the Workday product. The object-oriented database, the “no code” development platform, the service-oriented architecture (SOA), and the software-as-a-service (SaaS) delivery model of the Workday application are clearly changing the game for software development – indeed every vendor on the market today is talking about SOA and SaaS (of course, the “no code” platform and the OO database is not something so easily adopted within legacy architectures).

What’s great about these sorts for “battles” or “shootouts” is that the vendors get to showcase their products before a large audience. However, I have to say that what troubles me about this sort of approach is that it fails to address what I consider the most crucial aspects of any vendor selection process – that is, the vision and cultural fit between the vendor and the client. Selecting the right vendor should not be centered on feature-function analysis – an excruciating comparison feature-by-feature, function-by-function – because, frankly, most of the top tier vendors these days can meet most client requirements. Some vendors will meet some requirements better (or just differently) than others, while they may fall short in other areas. In the end, there will always be trade-offs. As HCM technology vendors continue to evolve, we’re seeing a clear convergence of functionality. For example, most vendors now provide pay-for-performance, goals linked to compensation and rewards, full on-boarding processes, self-service and configurable workflows and approvals – functionality that was not universally available three to five years ago.

When selecting a vendor for your enterprise HCM architecture, it’s important to keep in mind that you are most likely selecting a vendor who will be with you for the next 10-15 years. Therefore, your focus HAS TO BE on vision and cultural fit if you want the relationship to be truly successful:

Is the vendor’s vision for the future, and hence product direction – both technology vision and business process vision – in line with yours?

• How does the vendor’s product roadmap align with your own HR strategy and HR technology roadmap?
• Does the vendor’s approach to business process management meet your own approach and business process orientation?

What is the cultural fit between your leadership and the vendor’s leadership?

• Is there a focus on customer service, product innovation, and/or operational efficiency? (a reference to Michael Treacy and Fred Wiersema’s fantastic 1992 HBR article, “Customer Intimacy and Other Value Disciplines,” and 1997 book, The Discipline of Market Leaders).
• Is there a sense of partnership between your leaders and the vendor’s leaders? How well do they communicate and feel they can work together?

To me, these are the crucial questions to be answered in evaluating vendors and their applications.

I believe that “battles” and “shootouts” – along with the antiquated RFI/RFP (request for information/proposal) process – are artifacts of the past. Vendor / product selection is like a marriage – it should be made with the expectation that you will live with this partner, working side-by-side for the next 10-15 years. With real partnership, everything can be worked out.

Walking around the floor of the HR Technology Conference in Chicago this week, it is clear that one of the biggest challenges in understanding and evaluating Talent Management software is the sheer number of vendors offering solutions – all wrapped in considerable hype about being the “latest-and-greatest, most-comprehensive, state-of-the-art solution” on the market.

The fact is there is no silver bullet – there is no single vendor that provides all of the functionality now being grouped under the umbrella of Talent Management: Recruiting, Performance, Succession, Compensation, Learning, Career Development, and Workforce Planning.

To help companies sort through it all and make sense of the Talent Management market, following are few excellent resources you should look into:

Gartner Group just completed their 2007 Talent Management Market Scope which provides an excellent review of 30-some vendors and how they stack up against one another.

Bersin and Associates recently completed a survey of another 28 Talent Management vendors and evaluated the degree of functionality of each vendor across the different Talent Management domains.

CedarCrestone just released their 10th annual HR Systems Survey on HR service delivery and technology adoption in the industry.

These surveys cover the top 30-40 vendors, and there are literally hundreds more niche players, each with different strengths and weaknesses. One thing is clear: the market is quite fragmented, and consolidation is inevitable. You have only to look at the Recruiting industry – and most recently the Business Intelligence industry – to see examples of consolidation underway.

If you’re in the market for a new piece of talent management software, I would encourage you to not only look at your current situation, but also to focus on your future needs and how well those match with the future development plans of the vendors you’re considering. Too often we focus on fixing our current pain points, rather than, in the words of Wayne Gretzky, “skate to where the puck is going to be.” If you focus only on your current pain points, you’ll constantly be behind – by the time you’ve fixed those, everything will have changed and you’ll still be playing catch up.

This ability to address both current and future needs is what distinguishes a “great” solution from just a good one.

As I talk to companies about their frustrations around the inability to make progress with their Talent Management initiatives, the reasons center mostly around lack of data, tools, and infrastructure to provide the information they need. When I hear these types of frustrations, I think about The Hackett Group survey results that show quite clearly: best-in-class companies invest 28% more in their HR technology and infrastructure than average companies. One of Hackett’s latest press releases claims that companies can improve earnings nearly 15% by improving their talent management function.

With studies like these, how do we think can we improve our talent management function without investing in the technology to support the effort? We need metrics and tools to support the business case that investing in people enhances business performance.
In exchanging emails with my colleague John Macy about this, he says

“a) The tools are available for executives to use and progress from workforce analytics to predictive modeling. However, the tools need to be populated with the right information and relevant metrics. Too many use the tools to provide useless information.

b) Money needs to be invested in data integrity so there is a higher level of confidence in the information. The HRMS transactional stuff to collect data has been overlooked and processes are not in place to capture information as it changes in many companies. Poor integration of systems doesn’t help either.”

If “people are our most important asset,” as most executives claim, then at some point they need to put their money where their mouth is and invest in the tools and technology needed to effectively support the people-related activities in our business.

Marc Andreessen’s blog The three kinds of platforms you meet on the Internet is a very accurate description of the choices facing HR software developers today.

I think most people would agree a browser is the user interface of choice for the future and the Internet is the preferred network. The question is what platform should it run on?

Marc describes three platform options: Level 1 “Access API” is where the application code lives outside of the platform and probably executes on a server elsewhere. The application calls the web services API (Application Programming Interface) to access data and services. The entire application development, including runtime system, programming language, database, servers, storage and so on, is the responsibility of the developer. The Human Capitalist blog places most HR applications today on that platform and I agree.

Level 2 is what Marc Andreessen describes as “Plug-In API”. Developers build new functions that can be “plugged in” the core application. Like Level 1 the developer builds the function and the core application calls it up to execute as part of a total solution. In HR terms that is like joining third party applications for functions such as recruiting, benefits, training, and so on. In reality, the HR application becomes a portal and the third party applications contain their own unique attributes including database and screens. There are many HR vendors that promote their products as web service or SOA (Services Oriented Architecture) designed simply because they can be called up by a “plug in” API but are nowhere close to integrated.

Level 3 is described as the “Runtime Environment” where third party code actually runs inside the platform and developers are given access to code via a browser to build or change applications. Marc believes Level 3 platforms are the future and when it comes to HR applications, I agree. Some of the advantages Marc discusses include the ease of developing with simplified development tools (expertise levels drops by 90%) and cost is minimal (the level of money needed drops to $0). Marc claims the “sky’s the limit in terms of how much development can happen on a platform like that”.

An example of an organisation that provides a Level 3 platform mentioned by Marc is Salesforce.com. Salesforce.com are into CRM (Customer Relationship Management) applications but have only started to scratch the surface when it comes to HR applications. Marc suggests you can “provide a marketplace that lets people buy and sell code”. To some extent Salesforce.com do that via their AppExchange initiative but an HR ecosystem to support Level 3 applications require much more than that. There must be design standards to develop applications and a marketplace based on HR business process to facilitate the discovery of components.

If the “sky’s the limit” what is in the pipeline now for HR applications?

The Salesforce.com model is a good guide to the future. We know Oracle and SAP are dragging their feet when it comes to moving to Marc’s Level 3 Platform. They have invested heavily in their current platforms and change will not be quick or easy for them. On the other hand Workday have gone to market with an offering that fits Marc’s Level 3 better than any other product I know. However, it does not open up the code to developers to build their own variation to functions, in the same way Salesforce.com allows custom built components. Communities of developers can build components using Workday’s toolset and expand the functionality of the core system but true Level 3 applications require more than that.

From a development perspective, integration of components (possibly by multiple developers) is critical. There are many workarounds, but there is no substitute for a commonly available database that can be accessed (with create, read, update and delete capabilities) by all applications developed to work within the vendor’s framework application. Any other form of integration is only a developer’s way of dodging the real issue.

Regarding INTEGRATION, under Marc’s Level 1 application integration relied on protocols such as CORBA, COM and EJB or XML file transfers. That didn’t work. Under Marc’s Level 2 integration was not taken seriously. Data duplication thrived and data exchange was the only way to make information coming out of the systems meaningful: Even then accuracy and consistency could not be assured because solutions usually involved multiple proprietary systems from different vendors using different database structures. The Level 3 code and database on the same server provide some chance of success, if they can conform to published specifications and standards.

From a commercial perspective, an elegantly designed Level 3 application will not be successful unless an appropriate market operation is in place to support the component discovery and delivery process. That involves the ultimate consumer of Level 3 HR applications, and that is the business user. There is a point where technical design must give over to business implementation and finding the right mix of components and services cannot be left to chance. Developer communities, vendors and the HR industry must agree a way of cataloguing components for system assembly rather than rely on semantic discovery techniques. Otherwise the Level 3 platform on the Internet will end up being just another good idea the business community failed to embrace.

In this week’s Jeitocast, Karen Beaman interviews John Macy, Senior Global Advisor for Jeitosa Group in Asia Pacific and founder of Competitive Edge Technology, on the subject of SOA and services / component architectures. John is also the founder of Human Resource Component Software Application Standard (HR-CSAS) which defines the component structure for Human Resource Management Systems.

As we know, no one system can ever meet all of a customer’s needs, so the issue becomes integration. SOA or Service Oriented Architecture allows what the technologists call a “loose coupling” between components or services. That means it doesn’t really matter what programming language a component is built with and what platform it uses. “In theory, a client can go to the market and find the right mix of products that suits their needs and assemble them into one consolidated system using SOA features.” John talks about how SOA is changing to the way we do business by enabling a modular, Lego-like approach to building systems. The real value of web services and component architectures for HR systems is the ability to easily integrate a diverse mix of products into one consolidated system.

It’s important to stress, however, that care must be taken in the evaluation and selection of SOA products. There are some products on the market, like Dave Duffield’s new Workday product, that are built from the ground-up using native SOA and web technologies. There are many others “posing” as SOA products that are really just SOA “wrappers” around 20- or 30-year old technology. So be sure to look under the covers before making your decision.

Web services and SOA technology is becoming mainstream. Some predictions about SOA indicate that by 2008 80% of new business applications built will use SOA. For those considering the move to an SOA platform, John provides six basic steps to help companies get started on their SOA journey.

 

 What is a component based architecture? [19:20m]: Play Now | Play in Popup | Download

In this Jeitocast, Karen Beaman interviews Kelvin Gray from Workday, to discuss the question: What is the best technology for HR? Kelvin talks about three key characteristics that are key to building and deploying effective HR applications today:

Flexible – applications need to be easily modifiable to meet ever changing business demands… Object technology allows organizations to define “loosely coupled” business processes and that are easy to change and move around as business needs dictate.

Accessible – systems should not be islands of information, rather data needs to be accessible and easily shared across applications… Web services is a group of technologies that facilitate application integration because they are built on de facto standards.

Secure – we live in an era of heightened security concerns, hence the privacy and the protection of personal information is paramount — Data Encryption must be in the underlying architecture of the data base to ensure the greatest possible security for the HR system.

As I’ve talked about elsewhere¹, this new technology paradigm is bringing about a change in our business environment. Applications are now moving out of the back-office to the front-office. Rather than transactional efficiency and historical reporting, applications today are focusing on effectiveness and aiding the line-manager’s decision-making process. Likewise, as never before in history, we now see up to four different generations working together simultaneously in the workplace: Retirees/Veterans, Baby Boomers, Gen Xers, and the New Millennials. This technology paradigm shift, in concert with the changing workforce, is placing greater demands than ever on our HR applications to meet the needs of multiple types of users in the workforce, with widely differing sets of expectations for the applications they use in their day-to-day work.

These are certainly challenging and dynamic times for HR technology professionals.

¹ “The Promise of Web Services: Why SOA means Better HR Service.” By Karen Beaman and John Macy. IHRIM Journal. July/August 2006.

 

 What is the best technology for HR? [16:57m]: Play Now | Play in Popup | Download