Part I of this article presented my thoughts on the HR technology trends to watch in 2020. These trends include the ‘drones’- those that have been around for a while but are evolving in distinctive ways- as well as the ‘Mars landings’- those that will probably take a few more years to be mainstream.
This is Part II of the article. While Part I covered Trends #1, #2, and #3, this Part covers Trends #4, #5, #6, and #7.
#4: Maturing people analytics (PA)
The PA market, worth $1.7 billion in 2019, more than quadrupled from 2016. PA use cases now include insights on employee engagement, retention, diversity & inclusion, and productivity. Interestingly, a recent study put HR ahead of even Finance in analytics. The following sub-trends reflect this growing maturity.
Expanding ambit: New PA users, data sources, and techniques are emerging.
- Users: HR, the main user of PA technologies so far, is increasingly sharing the reins of PA with managers and even employees. This democratization of PA helps managers use real-time insights to make hiring and performance decisions. Vendors are now offering PA through handy mobile apps, often in the form of proactive nudges, to help managers make data-driven decisions (e.g., Executive and Manager Insights on the ADP mobile app). Vendors are also making it easier for lay users to understand and consume PA through augmented analytics (e.g., Workday People Analytics delivers personalized insights in a conversational, headline form).
- Data sources: PA technologies continue to rely on core HR systems as their primary data source. But they are now also accessing other sources such as employee survey tools, talent management systems, and work productivity tools. For instance, Workday People Analytics pulls in data from employee profiles, support tickets, emails, and collaboration tools.
- Techniques: Certain PA techniques, often based on machine learning (ML), natural language processing (NLP), and other artificial intelligence (AI) methods, are gaining ground. E.g., sentiment analysis tools that gauge employees’ emotions, motivations, and engagement levels (e.g., Perception by Ultimate Software); benchmarking solutions based on real, up-to-date data rather than reported data (e.g., ADP DataCloud Benchmarking); Organizational Network Analysis (ONA) tools to explore and optimize collaboration patterns (e.g., TrustSphere).
Focus on data ethics: In an age of dwindling trust and appalling data breaches and misuse, the focus is squarely on data ethics, and HR is no exception. Research shows that the biggest barrier to PA implementation is security, legal, privacy, and risk concerns. Some notable aspects of the broad field of data ethics are:
- Control: More than 90% of employees seem to be open to the collection of data on them and their work if it improves productivity or wellbeing. But, in return for their permission to collect data, about 70% of them want more control over the use of that data. PA practitioners are discussing sharing more ownership of data with employees and openly communicating well-defined PA objectives and benefits to them. Regulations such as the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) make several aspects of employee control, privacy, and transparency mandatory.
- Bias: Many ML solutions need data for training. If that data is riddled with biases, the solutions will be too. AI researchers are making progress on techniques such as counterfactual fairness and explainable AI to tackle this challenge. As companies use ML-based solutions, such as candidate assessment tools, retention predictors, and pay equity tools, to make life-changing decisions, companies and vendors are focusing on reducing bias (e.g., SAP SuccessFactors Business Beyond Bias).
#5: Extending frontiers in talent management
The traditional administration-heavy approach to talent management (TM) falls short of today’s imperatives. Companies are now prioritizing candidates’ and employees’ experience as they apply for a job, get on board, learn a skill, etc. Besides, AI now makes intelligent TM automation possible. These disruptions are making themselves felt, especially in talent acquisition and learning management.
Talent acquisition (TA): As unemployment plummets and skills become scarce, finding qualified talent remains a major challenge. Practitioners are turning to TA technologies to improve the quality of hire, reduce time to hire, and lower costs. While Applicant Tracking Systems (ATS) mature, other parts of the TA technology stack are becoming hotbeds of innovation, as described below.
- Sourcing tools that help companies tap into a wider pool of skills, including contingent workers (e.g., Upwork), under-represented groups (e.g., Entelo), and internal candidates (e.g., InnerMobility by Gloat), are gaining traction.
- New forms of AI-based candidate assessments such as video assessments (e.g., HireVue) and gamified assessments (e.g., Pymetrics) are becoming popular.
- Human capital management (HCM) vendors are focusing on even closer integration with successful career sites and job boards (e.g., Oracle’s partnership with LinkedIn).
- Other promising areas include chatbots for candidates (e.g., Mya), recruitment marketing tools (e.g., Beamery), and skills marketplaces (e.g., Workday Talent Marketplace).
Learning management: As we move towards a skills economy (see Trend #3), companies are loosening the purse strings for learning & development (L&D), providing active support at the highest levels for L&D, and prioritizing closing skills gaps and enhancing learner engagement. Corporate learning technologies are evolving in response. The learning experience platform (LXP) market is over $300 million and growing at more than 50% per year. LXPs help learners find, consume, and share content in the flow of work through a YouTube- or Netflix-like environment that presents ML-based content recommendations (e.g., Degreed and Edcast). The older Learning Management Systems (LMS) vendors are also incorporating LXP features (e.g., Cornerstone). Other innovations such as microlearning (e.g., Axonify), gamification (e.g., Designing Digitally), and virtual reality (e.g., STRIVR) are gaining traction.
#6: Fairness and wellness in the spotlight
Fairness: Changing demographics, powerful social movements, and proven benefits, such as better innovation, reduced fraud, and improved financial performance, have put diversity and inclusion (D&I) in the spotlight. A fast-growing D&I technology market, worth about $100 million, is emerging to help companies improve fairness at work. Common use cases include candidate sourcing (e.g., SeekOut), candidate selection (e.g., Blendor), performance management and career development (e.g., SAP SuccessFactors), and D&I analytics (e.g., Affirmity).
Wellness: Workism is making people miserable. Over 60% of workers aged 18–34 years say that stress from poor work/life balance or unrealistic work demands causes them to be unproductive at work. Companies have offered healthcare benefits for long, mainly aimed at avoiding insurance claims and preventing absenteeism. Now they are raising focus on proactive wellbeing solutions intended to improve employee health and productivity. Examples include mental health and stress management solutions (e.g., Virgin Pulse), financial wellness solutions (e.g., ADP Wisely), and gamified wellness solutions (e.g., Oracle Work Life).
#7: Fluid payroll
Continuous payroll is becoming an attractive and viable alternative to the traditional batch-processed payroll. Based on real-time integration and processing of pay, tax, and time data, it gives administrators a view of actual payroll throughout the pay cycle and enables continuous audits. It can allow employees to access their earned wages without waiting for the next payday. Such a fluid payroll solution can help workers living paycheck-to-paycheck meet unplanned expenses, thus improving their financial wellness and enhancing their experience at work. HCM vendors (e.g., Ceridian), as well as point solution vendors (e.g., DailyPay), are now offering such on-demand pay solutions.
Predicting the future is tricky. Take the case of the prediction that by 2020, there will be no need for futurists to predict the future! Jokes aside, what do you think about the future of HR technology? Which technology are you most excited or anxious about? Comment below!
- Originally published here.
- Opinions expressed in the article are my own.
- Vendor examples are only illustrative and not exhaustive.
About the author
Harsh Kundulli is a storyteller. At work, he tells stories to clients who want to transform their enterprise technology landscape. At home, he tells them to family and friends. His full profile is on LinkedIn. Stay in touch with him here.
Other stories by Harsh on Medium:
3 Powerful Hacks to Solve Your Problems Effectively
Use them to declutter your mind and think better