HR Software Advice for SMBs

Thursday, February 23, 2012
Posted by Brawlin Melgar

Photo: Antiquated Job Application form Used for Hiring and Tracking Talent

While mergers and acquisitions are always interesting for industry analysts, the most recent bout of activity – including the acquisitions of Rypple and SuccessFactors by Salesforce and SAP (respectively) – and now Taleo by Oracle—are particularly exciting. Why? Because this activity is driving change in areas of talent management technology that we primarily paid lip service to in 2011. But what does this mean for customers in the SMB market? What changes will they see in the software available to them?

Kyle Lagunas, HR Analyst at Software Advice – an online resource for reviews of HR software – has taken an in-depth look at what SAP and Salesforce stand to gain from their HR acquisitions, how it will impact this dynamic software market, and what steps customers can take to prepare for further movement.

As vendors great and small continue developing Cloud-based solutions, I believe there are three HR applications that offer the greatest opportunity for strategic growth through acquisition in 2012: talent management software, applicant tracking and recruiting software, and analytics and reporting applications. And in these areas, there are a few vendors who are ahead of the pack.

-  Because business leaders increasingly see the value in a system for developing their workforce,Talent Management Software continues to experience rapid growth in the Cloud. This sector has also seen some movement, as large vendors acquire best-of-breeds, particularly in learning management and performance management.

-  Many of the core functions of Applicant Tracking and Recruiting Software thrive in the social media arena, and it makes sense that you’ll see more social capabilities evolving in this area first. But Bernie Schiemer, CEO of HiringBoss, warns that “lower quality ATS’s, irrespective of their size, will start to feel the pinch as providers offering better value and more flexibility take market share.”

-  Your ability to identify and track trends in your retention rates, boosts in productivity, and benchmark performance will set your HR department apart from your competitors. And though HR has never had a problem with gathering data, HR software is recently making great strides in delivering technology that allows them to use that data. Analytics and Reporting Tools will continue to drive innovation in HR software.

That said, customers in the SMB market should be prepared for further moving (and shaking) in 2012. Exciting as acquisitions are for analysts, they can certainly be intimidating for customers. How will this all affect the people who actually use these systems? Worries over disruptions in service, changes in pricing or contractual agreements, and vendor contact staffing changes are a real concern when a vendor changes ownership. When evaluating human resources software or talent management products, ask pointed questions about a vendor's financial and strategic viability, and lock-in rates and service or maintenance terms. This can save you a headache down the line.

Take a look at his full analysis and forecast on Kyle's HR blog at: Have your own thoughts? Join the discussion, and leave a comment.