Strategic HR

From Stone Age to Space Age: Where Are We on the Path to Mature HCM?

Technology advances as it matures. Before Enterprise Resource Planning (ERP) platforms, there were hundreds of start-ups solving supply chain problems. Before comprehensive financial software, there were accounts payable, receivable, and bookkeeping packages. Eventually they merged into the platforms we know today.

Strategic HRUnder the umbrella term of Human Capital Management (HCM) there are many solutions that help manage, schedule, pay, and develop people; this HR software has been focused on Payroll, Workforce Management, Talent Management, and so forth, offered initially as best-of-breed solutions. Now we’re seeing the functionality of these different solutions come together under one application, as HCM.

While some solutions are “integrated,” many are not really working together seamlessly; the trend is clear though. Organizations are looking to have all their people processes combined in a real-time, one-version-of-the-truth solution.

Recently, I had the chance to spearhead a study in partnership with Dimensional Research examining the adoption of HCM technology. We wanted to see the maturity of the adoption of HCM technology at organizations today.

We surveyed 700 HR and HR Technology professionals in front-line, manager, and executive positions on their use of HR solutions and how effective they were. These professionals work at organizations of varying sizes, across North America and Europe, in different industries.

What Does HCM Maturity Look Like?

We see HCM maturity as a single application providing real-time data, as well as access to the functions and data employees need anywhere and everywhere—be it at a home or work computer, a tablet, or smartphone on the go. It should be a solution that doesn’t require any manual intervention to move through processes—a solution where people are confident in both the data it gathers and the calculations it performs with the data because errors are very rare.

Why Is This Important?

This model can be used as a yardstick to gauge your organization’s progress towards an ideal. While that ideal is our outlook of what mature adoption looks like, the benefits of mature HCM adoption as we’ve defined it should be evident to HR professionals of all stripes. If we can agree on where we are, and where we’re going, it should be easier to get there.

The HCM Maturity Model was based on a standard maturity model with a one to 100 scale. The average score? 48.

The study asked respondents how many vendors provide their HCM solutions, how effective they were at integrating and sharing data, how users could access their functionality, and to what degree their people reported enjoying using them.  These responses were organized by organization size, industry, and management level, enabling analysis that drew out some interesting results. A few highlights follow.

Compliance. While nearly 2/3 of respondents say that their systems include best practices, guidelines, and advice, less than half of respondents claim they are very confident that all of their solutions enable them to operate in compliance with relevant rules and regulations.

Access. While 90% of respondents say that employees can access HR focused tools at the office, that number falls to less than 50% from home, and 45% from mobile devices. What is even more surprising was that Retail and Healthcare, two industries that have heavy requirements for shift-based labor, posted even lower numbers.

Integration of Processes. Fewer than one in five respondents report that all their HCM solutions are integrated together, and only 5% state that no manual steps are needed in their “automation” between solutions. That in itself implies that many professionals view processes as integrated even if they require manual steps to do so. This points to the bar being set low for the meaning of integration.

The study illustrates overwhelming data that the maturity of HR systems is far from ideal, and that is caused by the normal growing pains that have been seen in other technology stacks. The goal is to have employee access to all employee processes wherever they are, and to have all the data they need available in real-time.

The bright side is that based on the history of different technologies, real-time, integrated platforms will mature to reach high levels of functionality, and some are approaching this today. Now it’s up to organizations to drive their processes to improve as they embrace this emerging technology.

Ted Malley is the Chief Customer Officer at Ceridian, responsible for the health and happiness of the organization’s growing customer base through its XOXO Customer Success Program. He is additionally responsible for the Account Management and the Strategic Alliances teams focusing on building both Ceridian customer and partner relationships.

Previously, Malley was Senior Vice President of Product Evangelism and Customer Success, responsible for the successful integration of TeamRelate within Ceridian’s award-winning, single application, Dayforce HCM.  Prior to joining Ceridian, Malley co-founded RelatedMatters, acquired by Ceridian in March 2015. With over 25 years of experience in technology and human capital management software, Malley has held a variety of senior customer relationship, technology and project strategy positions.

Malley holds a Bachelor’s degree in Computer Science from California Polytechnic State University, San Luis Obispo.