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Welcome to PeopleTech, the podcast of the HCM Technology Report. I’m Mark Feffer.
This edition of PeopleTech is brought to you by UKG. Combining the strength and innovation of Ultimate Software and Kronos. Together, they’re committed to inspiring workforces and businesses around the world. Learn more at www.ukg.com.
Remote work. Digital recruiting. Online collaboration. Analysts call it all disruption, but investors call it opportunity. And they’ve jumped to take advantage. During the third quarter, they put more than $1.6 billion into HR technology. That comes from the quarterly report by George LaRocque, HRWins and UNLEASH.Podcast: Investors are putting serious money into an #HRTech landscape that's fundamentally changing. #HR Click To Tweet
The report suggests two factors were at play. First, there was some pent-up activity. Investors held back during the second quarter so they could get a sense of the market. The second factor: Once they did, a lot of deals started to take shape.
The money for those deals largely tracks what employers have been saying they need. Tools that help with collaboration and communications, learning, wellness, core HR and safety.
If you want some numbers, more than $866 million was invested in HCM solutions. $612 million went into talent management, but just $168 million into talent acquisition. That’s the lowest amount since 2017, and probably not surprising given business conditions and the job market.
So investment’s healthy. But the HR tech landscape may be changing. The Fosway Group, an analyst firm based in England, says more employers are coming to believe they need more than a single HR solution. Instead, they want an “ecosystem.”
Fosway’s report is called the 9-Grid for Cloud HR. It sees new, specialized products coming to market. They’re designed to handle specific processes, and give customers more flexibility in combining traditional platforms with more focused tools.
That’s happening as vendors, big and small, pivot. Covid-19 wasn’t in anybody’s plans. But since the spring we’ve seen a rash of products for video interviewing, virtual onboarding, digital learning and workforce supply. The result, Fosway says, is that “full digital transformation is now a reality.”
In tech, of course, reality’s a moving target. A lot of people keep emphasizing experience, and there’s research that shows a good experience leads to good business results.
Fosway has some perspective on this, though. They say user experience is still important, but it may not be “the critical differentiator” that many people think it is. In fact, it’s now table stakes, or soon will be, they say. But one part of the experience is becoming more visible, and that’s the idea of reducing friction. Making it simpler for employees to complete a task, without having to switch applications or anything like that.
We’ve heard more talk about “reducing friction” this year. Reducing friction and delivering solutions “in the flow of work.” These are both concepts working their way into technology that’s used throughout the organization. I’m guessing we’ll hear less about experience and more about friction as time goes on.
This has been PeopleTech, the podcast of the HCM Technology Report. This edition has been brought to you by UKG. Combining the strength and innovation of Ultimate Software and Kronos. Learn more at www.ukg.com.
And we’re now proud members of Evergreen Podcasts. To check out other shows, visit www.evergreenpodcasts.com.
And to keep up with HR technology, visit the HCM Technology Report every day. We’re the most trusted source of news in the HR tech industry. Find us at www-dot-hcm-technology-report-dot-com. I’m Mark Feffer.
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