The rise of HR tech in Singapore
Our CEO, Damien Cummings, recently had interview with Sandra Sendingan of the Singapore Business Review about the emergence of HR tech and the role Singapore plays in this important new industry. Here are his insights and answers to the interview questions:
Please describe the adoption of HR tech products in the Singapore market. What specific verticals (people analytics, mobile HR, feedback and management tools) are the subject of much development and which areas need more attention? What recent trends have you noticed in the HR tech market in recent months?
The adoption of digital and HR tech in Singapore is hot right now. CEOs and HR leaders have long embraced new technology but it’s only now that HR tech is catching up. The digital transformation of other members of the C-suite happened a lot time ago — CFOs manage finance via ERP and many other financial software tools, Marketers are data-driven and Sales Leaders are using Salesforce but HR hasn’t had the same level of tool, until now. The really hot areas in HR tech are employee analytics, people management and recruitment. These are tools that automate, learn and make life for both management and employees a lot better.
The biggest trend in HR tech is that’s a demand to move away from compliance-driven tools (payroll, leave management, HRIS, etc.) towards tools that provide actionable insights and make HR more of a business function. The best CHROs are now working alongside their CEO to understand their people, drive revenue improvements and cost savings. HR tech is powering this.
How does Singapore compare to its regional and global peers in terms of HRtech adoption? Where is it lacking?
Singapore has always been an early adopter of technology but its also a very risk-averse environment. No one wants to be first or seen as standing out too much. Up until recently, the real innovation in HR has come from the United States, but that’s quickly changing. In my experience, western markets like the USA and Australia have been more willing to embrace people analytics and move beyond compliance. Singapore is a market very focused on efficiency — reducing costs to hire, keeping good people in their jobs longer and avoiding regulatory concerns.
With DBS rolling out a digital bank recruiter, how are recruitment firms responding to the digital innovations in the HR landscape? With the ongoing digitisation of much of redundant work, where does technology adoption of HR in the priority of Singapore businesses?
New HR tech like AI and people analytics present a real challenge to recruitment agencies, but it’s not immediate. There was similar sentiment when LinkedIn became mainstream about 10 years ago — a great fear that recruiters would lose their jobs. It just didn’t happen. Although things did change. The real drivers for rolling out new HR tech for recruitment are two things. First, talent acquisition teams and hiring managers just don’t have enough time (one of the big reasons recruitment agencies are still going strong), and second, in-house recruiters are looking to save money. Recruitment agencies have traditionally relied on having a big network and high calibre candidates in their database but this is less and less of an advantage. Recruiters are a savvy lot though. When LinkedIn launched, they embraced it. The same is true with HR tech such as AI and people analytics. The smartest recruitment networks are investing in or collaborating with HR tech vendors. While it’s not mainstream yet, within the next 2 years all candidates will be using agency endorsed software for applying to new jobs, going through background assessment, preparing for their first day on the job and being managed through their first 100 days in the new role.
Is there room to argue that recruitment jobs are at risk of displacement by the growing adoption of HR tech? Why or why not?
Recruitment agencies will survive and thrive as HR tech grows. Their business model won’t. The days of paying 25%+ of a person’s annual salary to a recruiter will die out quickly. I see this being replaced with subscription models, software license fees and consulting engagements. I believe recruitment agencies that embrace and partner with the rising HR tech companies are going to be really successful. Their focus will be on understanding the marketplace trends, employee behaviour, helping drive engagement and getting deeper into the ROI of hiring and developing leaders. I’d love to see recruitment agencies become people-centric management consultants. They’ll be a lot more successful if they can make that transition. Of course, working with HR tech companies will help.
How can Singapore businesses successfully navigate HR tech? What’s the outlook for HR tech in Singapore?
The outlook for HR tech in Singapore is very bright. The problem, however, is keeping up. The digital transformation of HR and people management means that the skills that HR leaders have today need to change and evolve. There are three big trends that I’ve experienced. First, HR teams don’t want to pay millions of dollars to global software vendors that offer clunky solutions that don’t work for Singapore or Asian needs. The price needs to come down and ROI is a growing concern. Second, data and analytics are becoming the core skillset in HR tech. HR leaders will need to quickly become more data savvy and data-driven. This will require a lot more training from industry bodies and educational institutes. Finally, the best new HR tech is home-grown. HR leaders can work with local Singapore companies to get inside information and advice, that’s just not available by working with US or European software companies. This is a great advantage. My advice is to find a few cool up-and-coming HR tech companies in Singapore and make them your best friend — they’re already at the cutting edge of the industry and are very happy to educate and support you.
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Peoplewave’s software suite is blockchain-ready — its blockchain platform is called “Wavebase”. Wavebase is a revolutionary platform that provides ongoing verified employee performance information that will change the face of hiring and managing workplace talent.