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Author: Madeline Laurano

Madeline Laurano is the founder and chief analyst of Aptitude Research. For over 18 years, Madeline’s primary focus has been on the HCM market, specializing in talent acquisition and employee experience. Her work helps companies both validate and re-evaluate their strategies and understand the role technology can play in driving business outcomes. She has watched HCM transform from a back-office function to a strategic company initiative with a focus on partnerships, experience and efficiency.

Before founding Aptitude Research, Madeline held research roles at Aberdeen, Bersin by Deloitte, ERE Media and Brandon Hall Group. She is the co-author of Best Practices in Leading a Global Workforce and is often quoted in leading business publications including The Wall Street Journal, The Boston Globe, Yahoo News, The New York Times and The Financial Times. She is a frequent presenter at industry conferences including the HR Technology Conference and Exposition, SHRM, IHRIM, HCI’s Strategic Talent Acquisition Conference, Unleash, GDS International’s HCM Summit, and HRO Today.

In her spare time, she is a runner, an avid sports fan and juggles a house full of boys (where a spontaneous indoor hockey game is not unheard of!).

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The HR Technology Conference 2016: Slow Down to Speed Up

A group of co-workers smiling and working together around a table

In HR technology, competitive advantage is too often confused with how fast a solution provider innovates and launches new capabilities. Categories are created and products are enhanced with very little consideration for what customers actually want or need. The pressure to “speed up” has created confusion in a market that is already crowded and complex.

But, at this year’s HR Technology Conference, the tone seemed different. Solution providers are slowing down, being more thoughtful with product launches, and getting back to the basics. They are thinking about what will help customers improve the way they recruit, develop, and manage their workforce. They are thinking about the employee, the manager, and the candidate. And, while future-looking topics like AI, machine learning and robotics were undeniably mainstream, there was still a heavy focus on simplicity. Both traditional solution providers and startups are tackling fundamental areas of HCM such as assessments, performance management and recruitment. And, surprisingly, this is where much of the product leadership is happening…in the basics.

The simplicity at this year’s conference represents a refreshing shift in a market that has a history of overcomplicating even the most basic of processes. Below are some of the categories and providers that stood out this year:

Assessments

Assessments are a critical part of the hiring process with 79% of companies using some type of pre-hire assessment. Our research shows that assessments are top on the list of investments for companies this year. While stand-alone assessments are still on the rise, established suite providers and talent acquisition platforms are focusing heavily on this market- providing validated assessments and improving the candidate experience. Below are a few providers we are paying attention to:

  • The Chemistry Group: One of the darlings of the Great New Tech session, The Chemistry Group is a next generation assessment provider taping into social profiles and rich candidate data to help employers make better hiring decisions.
  • Cornerstone OnDemand: Cornerstone’s Selection solution allows companies to uncover candidates who are the right fit at any point of the application. Using realistic job previews, job simulations, and assessments, Cornerstone Selection makes it easier to exclude applicants early in the process.
  • HireVue: For anyone that has ever wanted a shorter, simpler, and more candidate-friendly assessment, HireVue’s digital assessment will meet those needs. Its’ assessment product significantly improves the way that employers can identify the right fit while improving the candidate experience.
  • Infor: Assessments are a priority for Infor’s HCM suite. The provider has invested heavily in behavioral and cultural assessments and is pushing these assessments in the rest of its products. It does this so seamlessly that companies are able to get a better grasp of areas such as flight risk, predictive performance, and team development.
  • SMD: SMD (Strategic Management Decisions) was one of the most interesting briefings we had last week. This company is a cloud-based survey, assessment, and analytics provider that promises clients a 10% turnover reduction guarantee.

Performance Management

Companies are finally replacing traditional performance management practices and technology with solutions that provide ongoing feedback, enhanced collaboration, and a positive employee experience. Providers are weaving performance in the form of recognition, wellness, and communication. And, the result is happier employees, a stronger company culture, and improved business outcomes. Below are a few providers, we believe are adding value to this market:

  • ADP: With a new take on performance management and an improved manager and employee experience, ADP is reimaging performance management and enabling greater transparency and feedback.
  • HighGround: Another startup in the Next Great Technology session, HighGround links performance and engagement by offering companies one platform for performance, recognition and employee communication.
  • GuideSpark: Companies that effectively communicate with employees are 4 times more likely to engage employees and 3 times more likely to improve quality of hire. GuideSpark’s communication platform helps companies such as Lionsgate to replace broken performance management systems with ongoing conversations, content and analytics.

Recruitment Marketing

Often referred to as the “pre-applicant platform,” these solutions manage outbound sourcing, inbound recruitment marketing, and employer branding. They integrate with any ATS but essentially, they do what the ATS has never been able to do. Below are a few providers that impressed us last week:

  • Clinch: One of the best products I have come across this year in the recruitment marketing space (and another nominee in the Next Great Technology session). Clinch helps recruiters think more like marketers by helping them easily publish content, attract passive talent, and understand what sources are the most valuable.
  • Entelo: As a leading talent acquisition provider, Entelo is the one provider that offers a unified talent pipeline. They offer outbound recruitment to help companies attract talent and inbound recruitment (through their award-winning Stack product) to help companies rank and prioritize resumes.
  • Phenom People: Calling itself a “Talent Relationship Platform”, Phenom People differentiates itself by using AI to learn about an individual and the touchpoints an organization makes and then provides insights back to recruiters and candidates.
  • Qwalify: Another provider that was nominated as a Great New Technology at the conference, Qwalify is much more than a talent community. Its’ Talent Dojo solution is an engagement-based recruitment platform which helps companies communicate with current and future talent relationships.
  • SmashFly: Smashfly sets the bar high in recruitment marketing. It is helping organizations through a complete recruitment marketing platform of inbound recruitment marketing, outbound sourcing and employer branding. It offers the scalability, services, and security that enterprise companies are demanding.
  • Talemetry: Talemetry leverages a company’s existing recruiting system investment and deeply integrates it with a unified modern recruitment marketing platform. The recruitment marketing solution is now offering auto-sourcing and has strengthened its services over the past year.

Applicant Tracking Systems

Today, the talent acquisition system remains the backbone of a modern recruitment function. Yet, Aptitude Research found that two out of five companies are still unhappy or indifferent with their provider. And…companies are only using 3% of its functionality. So, in the world of recruitment, the need for simplicity has never been greater. Last week, we met with ATS providers that are breaking the mold. Below are our list of some of the providers that impressed us in recruitment:

  • iCIMS: As a provider that has always prioritized customer satisfaction, iCIMS truly understands what clients want from an ATS. The iCIMS Mobile Hiring Manager App. enables hiring managers to take immediate action on job candidates from virtually anywhere, alleviating “log jams” in the hiring process and reducing time to fill.
  • Jobvite: Jobvite is one of the leading talent acquisition providers in the market and differentiates itself by offering solutions to handle every aspect of talent acquisition including recruitment marketing, ATS, and onboarding functionality. Its’ priorities over the next 12 months include mobile, analytics and collaborative hiring.
  • Lever: The fast-growing ATS provider is only 3 years old but has already secured itself as a staple in the talent acquisition tech community. While many providers have taken steps to offer a CRM module as an option in their product portfolio, Lever includes its CRM (its Nurture product) and ATS as a single solution.
  • ZipRecruiter: One of the greatest success stories of the past year has been the growth of ZipRecruiter. Well known for its marketing and advertising, ZipRecruiter is more than just a job distribution tool. It offers companies in the SMB market, a full ATS to help with high-volume, quality of hire and velocity.

Artificial Intelligence

It is hard to talk about this year’s conference without mentioning the role of AI. Companies want solutions that can give them greater insight on the individual and greater communication with candidates and employees. A few of the companies leading the way in AI include:

  • gr8People: This provider is offering recruitment automation through every stage of the talent acquisition process from recruitment marketing to onboarding.
  • Olivia: The big topic of the conference was Olivia, the bot that asks candidates a few simple questions and then sets them on a more personalized experience in the hiring process.
  • Works Applications: The leading Japanese provider is leveraging bots to better engage candidates and help provide feedback on the hiring process.

We will follow these providers and more this year and next and will be profiling them in our upcoming Aptitude Index reports. Also, we would love to hear from you about what providers were most interesting to you at the HR Technology Conference.

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HR Technology Conference: 5 Reasons We are Excited to Attend

tortoise toy ahead of a hare toy

It is hard to believe that the HR Technology Conference is just one week away. This will be my 10th year attending the event and I have been spending the past few days reflecting on the past and considering the future. So much has changed in this industry over the past decade. Some of the largest providers have been acquired (Taleo, SuccessFactors, Kenexa and now Monster) and many exciting startups seem to be taking center stage. Providers are going to market with solutions that not only lift the administrative burden off of HR departments but also, provide a meaningful experience for candidates, employees and managers. The value proposition for many of these solutions has never been greater.

As we start to plan for next week, below are five things we are most excited about:

  1. Startup Pavilion: “The value of an idea lies in the using of it.” – Thomas Edison, General Electric Co-founder. The startups at the conference will not disappoint. Over 50 companies will be participating in this year’s Startup Pavilion including onboarding, assessment, performance management and benefits companies. They are all rethinking the way companies rely on technology to manage their workforce and enhance the employee or candidate experiences.
  2. Next Great Technology: Speaking of startups…on Tuesday, October 4 at 3:30pm, I will be participating in The Next Great Technology session where participants will be able to hear and vote on 8 of the most exciting providers in the market today. Check out HighGround (performance management) and Clinch (recruitment marketing) who will be featured during this session.
  3. Performance Management: Are companies really ready to throw out traditional performance management practices and systems and replace them with more innovate and effective options. We think so. We have seen companies such as GE and Lionsgate rethink their approach for performance and invest in new solutions. Many providers are offering viable options- something we have not seen for a long time.
  4. Candidate Experience: Every talent acquisition provider is prioritizing the candidate experience in all aspects of recruitment. And while we are excited to hear what new technology is improving candidate feedback, we are most excited to hear from industry expert Gerry Crispin– who has spearheaded this movement. (He was also our last guest on the Research on the Rocks podcast).
  5. Conversations: Last year, we set off on a journey to start a new conversation in HCM. This year, we are excited to continue that conversation by reconnecting with familiar faces and making new friends in this very exciting market. We hope to see you there!
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The Future of Work: A Wish List

At the start of Labor Day weekend, it seems appropriate to reflect on the realities and possibilities of work.  According to the Department of Labor:

“Labor Day is a creation of the labor movement and is dedicated to the social and economic achievements of American workers. It constitutes a yearly national tribute to the contributions workers have made to the strength, prosperity, and well-being of our country.”

Our theme at Aptitude this week has been the future of work but maybe it’s time to take a step back and think about the past. How can we do a better job as employers of paying tribute to the contributions of our workers? A day off is great but why can’t this happen throughout the year on a more consistent basis? So, in the spirit of Labor Day and honoring the past, here is our wish list for the future of work.

–       Recognition: Seventy-five percent (75%) of companies have a formal recognition program according to research we conducted earlier this year. Yet, so few of these companies make sure that recognition is ingrained in the company culture or invest in the right technology to motivate their employees. Recognition, the art of saying “thank you”, needs to be a core part of the work environment.

–       Communication: When asked to identify the top priorities for recruiting and engaging talent, stronger employee communication was top of the list across all industries and company sizes. Today, success is defined by a company’s ability to align strategy and execution, and effective communication is critical to achieving this alignment. In fact, top performing companies are 3 times more likely to invest in communication than their peers.

–       Flexibility: Earlier this week, Amazon announced that it would let some work a 30 day work week. This decision gives employees the freedom to spend less time in the office. Employees want greater flexibility not only with the ability to work from home but around the employer/employee relationship. With the influx of contingent workers in the market, employers that provide greater flexibility will not only see an increase in employee morale and engagement but also, in productivity and performance.

In order to take a look at the future, maybe we need to start by taking a look at the past and getting back to basics. We will be covering these topics in our upcoming Culture Survey later this month. Stay tuned…

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Top 7 Findings on Talent Acquisition in the SMB Market

compass with the arrow pointing towards the word talent

Today is the end of SMB Week at Aptitude Research Partners. Small to mid-sized companies face a unique set of challenges with talent and workforce management and we are excited to share our latest research on this demographic. According to Aptitude Research Partners’ 2016 Hire, Engage and Retain study, nearly 70% of SMB organizations invest in technology that is up to date with consumer technology. The top three investments for SMB organizations include video interviewing, employer branding tools and onboarding solutions. They want tools that improve the candidate experience as well as ensure quality of hire.

Below are the top findings on talent acquisition for SMB companies:

  • Dissatisfied with their Technology: Nearly 50% of SMB companies are dissatisfied with their ATS and looking to change providers compared to 36% of enterprise organizations.
  • Candidate Comes First: Sixty-three percent (63%) of SMB organizations have improved their candidate experience over the past year.
  • Not a Mature Market: 1 out of 3 SMB companies do not currently have an ATS in place. Fifty percent of those companies that do have a system in place are dissatisfied or indifferent with their current provider and looking to make a change.
  • Word of Mouth is the New RFP: One third of SMB companies believe that word of mouth is the most influential factor when making decisions around recruitment technology. Price and demonstrated ROI also play a key role in technology decisions.
  • Opportunity for Best-of-Breed: Fifty-seven (57%) of SMB organizations invest in an ERP provider or Talent Management Suite provider for their ATS. Only 14% of SMB companies are using best of breed providers for their ATS.
  • Implementation Time is Shorter: 85% of SMB providers implement their recruitment solutions in less than 1 year. Forty-seven percent (47%) of these companies believe their provider was a true partner through the implementation process.
  • Need More Change Management: Only 22% of SMB organizations have a change management process in place and only 38% of these companies were satisfied with their provider through the implementation process and would recommend them.

For more insight and research on how SMB companies are using talent and workforce management technology, check out our latest reports at www.aptituderp.com.

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Don’t Call It a Comeback: Salary.com is Packing a Punch in Compensation

everlast boxing gloves tied together and hanging down

It is easy for traditional HCM solution providers to get stuck in a rut. Too often, they have a myopic view of the market and look only at themselves, their competitors, or last year’s trends. When the market changes, they struggle to keep up.

So, imagine a situation where a solution provider took some type of “sabbatical”- leaving the industry, exploring the broader tech world, and testing out innovative solutions outside of HCM. My guess is that we would see a more sophisticated, business-centric solution or at least, something we haven’t seen before. In many ways, this is what happened with Salary.com. You are probably familiar with the Salary.com story. The company was acquired by Kenexa (now IBM) in 2010 for $80 million and then, it was bought back by the original founding team in 2016 with the goal of helping companies pay competitively, improve efficiencies, and enable pay transparency. Nearly 40% of the original Salary.com team has rejoined the founders to develop a comprehensive suite of compensation and data solutions as well as training and implementation services. They have returned to try to innovate a market that has gone stale.

This week, Salary.com announced new features to its Compensation Analysis Suite of solutions including configurable dashboards, interactive insights and a mobile application. These new features make it easier for employers to access compensation data the way they need it and essentially, keep their employees happy through better transparency and ease of use. Something, we haven’t seen enough of from existing providers.

Compensation is an interesting market and hasn’t had the attention it deserves considering it is one of the most important aspects of the employer/employee relationship. Employers are being held more accountable while employees expect more. And, so much has changed with the way compensation is managed for organizations. We are seeing an increased emphasis on competitive pay, the need for greater pay transparency, and new regulations around gender pay inequity and executive compensation. It makes sense that the founders of Salary.com, given their expertise, would see the need for a more robust solution in this market.

We are covering the compensation market in our upcoming Culture survey and research that we are publishing soon. So, this is a market we are watching closely and looking forward to sharing our research with you.

 

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Randstad Acquires Monster: The End of the Glory Days

monster job board logo

Ten years ago, I was the Research Director at ERE Media. It was the heyday of recruitment and right before everything in our industry changed (mostly, for the better). Taleo was just plain old Taleo, the largest ATS provider. Jobster and Jason Goldberg were the most interesting names in the space. The blogosphere was filled with controversial and thought-provoking discussions. And Monster was still at the center of it all. Spending tons of money on marketing, flexing its muscles in all things recruitment, and living large. Maybe too large. The value of job boards was becoming questionable and companies started reducing their investments in favor of LinkedIn and niche boards. The writing was on the wall. But, instead of rethinking its strategy, Monster just carried on in a big way. It acquired HotJobs in 2010 for $225 million and then, China HR for $174 million. Instead of reinventing itself, it just kept biggering and biggering.

Over the years, Monster made a few attempts to expand outside of the job board arena including acquiring TalentBin, developing 6Sense and SeeMore (semantic search engines), attempting to play in the CRM and ATS space with the HRSmart acquisition, and more recently, acquiring Jobr (the Tinder of recruitment). But most of its efforts (with the exception of TalentBin- by far, its best decision) fell short. The products did not integrate, the pricing was all wrong and yet, the messaging stayed the same.

The downfall of Monster reminds me of the high school quarterback. Someone that gains so much attention early in his life and then tries to relish those glory days even when the rest of the world has moved on.

So, where do we go from here? Two days ago, Randstad announced its plans to acquire Monster for $429 million – that works out to be $3.40 a share (by the way, Monster’s share price was once $91). In my opinion, the acquisition does not disrupt the market or change the landscape in any major way. What it does do is present a few unique opportunities for Randstad.

  1. Establish Leadership in Technology: Services and technology are becoming more ingrained in all areas of HR Technology and recruitment is no exception. Randstad is working to establish itself as a tech provider with its investments (through its Innovation Fund) in companies like gr8People and RolePoint and its own development of solutions like Talentradar. Yet, when you think of Randstad, you still think of services- RPO and MSP. This acquisition gives them more of a ground to stand on as a recognized technology provider.
  2. Expand its Global Presence: There is no denying that both companies are global companies but the acquisition of Monster gives Randstad even more global recognition. Monster has a presence in over 40 countries and 50,000 employees around the world.
  3. Articulate the Value Proposition: Monster made some bad decisions but it made a few good ones (I mentioned TalentBin above). Its major problem was it could not articulate the value proposition. It couldn’t get out of its own way. It acquired a broad spectrum of talent acquisition providers and developed solutions that would connect employers with job seekers but it wasn’t able to integrate these products or its messaging. It was still stuck in the past. The glory days.

Randstad is an impressive company with an impressive team of industry experts and individuals committed to helping companies recruit better. So, this acquisition may be the best decision Monster has ever made.

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Dog Days of Summer: What’s Keeping Us Busy

woman working from her tablet sitting outside at a wooden table

It has been an exciting summer for us at Aptitude. After several months of hectic travel schedules, Mollie and I have decided to stay local in August. We are busy publishing new research, prepping for the fall conference season, and collecting and analyzing more data. The best thing about less travel is that we get to have some amazing conversations with solution providers, corporations, and the broader HCM community. It has been eye opening and we have learned a lot.

If you are curious about what we have been up to this week, here are five things that have been keeping us busy:

  1. Research on the Rocks: In case you missed the news, we are now part of the HR Happy Hour Network founded by Steve Boese and Trish McFarlane. Our podcast series, Research on the Rocks, will highlight some of the key findings from our research and interesting trends in HCM technology. Our first episode covers payroll, communication, recruitment marketing, and assessments.
  2. Recruitment Marketing Index and Workforce Management Index: We published our first Talent Acquisition Index report a few weeks ago and we are already well on our way with the next two. The Workforce Management Index will provide insight on areas such as time and labor, scheduling, payroll, and absence management. The Recruitment Marketing Index will provide clarity around a very popular yet confusing space.
  3. Culture Survey: Culture is a powerful force within organizations, but one that remains mysterious to many. This survey will focus on how an organization communicates, what behaviors, skills and achievements it rewards, the work environment and “employee deal” of compensation, reward, and benefits, and even how it assesses talent. We are collecting feedback on the survey now and it will launch at the end of this month.
  4. New Technology: It is an exciting time to be in HR Technology, especially with so many new providers offering solutions that are solving business challenges. We have been conducting briefings with many of the start-ups in the space and we are getting excited for The HR Technology Conference.
  5. New Research: We have new research now available on our website that cover a wide range of HCM topics including: background screening, employee communication, the talent acquisition trifecta, and employee burnout. These are reports all based on data we have collected over the past few months and topics we feel deserve more attention.

So, we have been busy but in a good way. If you have a new company, new product, new strategy or new idea, send us a note. We would love to schedule a call and hear from you.

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Employee Communication: Lessons from The State of Colorado

A woman scrolling through the New York Times on her smartphone

Most companies understand the importance of employee communication but fail to have an effective strategy. Companies need to continuously practice and improve the way they communicate. They need to invest in the right strategies and tools to make communication consistent and engaging. And, for many companies, it doesn’t come easy. We found that less than half of employees are reading their communication messages.

The State of Colorado is one company that has prioritized communication, invested in an employee communication platform and achieved significant results over the past few years. I had the opportunity to interview this impressive organization recently for our recent Employee Communication report. Below are some highlights:

With over 95,000 total employees and offices in all 65 counties, the State of Colorado is the second largest employer in Colorado. Communicating with employees and providing the right education on Total Compensation became a top priority in 2015 when the State of Colorado revamped its communication strategy and invested in a communication platform.

The Challenge: Several years ago, employee communication was a major challenge for the State of Colorado. For starters, HR was not centralized and agencies within the State of Colorado had their own independent communication strategies. These agencies had no clear model or even a standard employee benefits guide to inform them on issues such as benefits, wellness and compensation. Communication was not consistent and often had conflicting messaging throughout the organization. As a result, only 12% of employees participated in open enrollment in 2014.

The Strategy: Two years ago, the State of Colorado made the decision to invest in a more systematic approach to communication. HR began to shift from a reactionary role of delivering messages to a proactive role of empowering employees to achieve success. Instead of agencies doing one-off communication, the State of Colorado made the following changes:

  • Communication Campaign: The State of Colorado invested in a multi-channel campaign, referred to as its “HR Toolkit” that included emails, train-the-trainer materials, webinars, regional meetings, and posters.
  • Communication Platform: Through the use of GuideSpark’s multi-media solutions, the State of Colorado was able to provide compelling videos and content to engage and connect with employees. It was also able to measure those efforts through GuideSpark’s analytics.
  • Develop an Annual Employee Benefits Guide: For the State of Colorado, the employee benefits guide replaced the independent communication efforts of the various agencies and provided the consistency and context that employees needed.

The Results: Through a new communication strategy and the right technology investment, the State of Colorado was able to achieve the following results in open enrollment in 2015:

  • 98% participation in open enrollment program
  • 31% increase in High Deductible Health Plan enrollment
  • 150 hours of time saved by eliminating meetings
  • 50% participation in wellness program.
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Blog Talent Acquisition Strategies

New Research on the Talent Acquisition Market: The Aptitude Index Report

The Aptitude Index Report for the Talent Acquisition Systems from 2016

If you read Mollie’s blog post on Monday, you can probably sense that we are very excited to announce the launch of the Aptitude Index report today. This is a comprehensive study of the leading talent acquisition system providers and their unique differentiators. It is not a ranking report. It is not a traditional buyer’s guide. It is not a magic quadrant. Instead, it provides in-depth analysis of the market and information that is not necessarily available in a demo or on a website. We spent over 8 months interviewing customers, demoing solutions, and getting briefings from providers. We are ready to share our findings. I learned a lot and I am very impressed by how far the ATS market has come in just the past year.

(Check out our video describing the report here)

If you are still unsure about what the Index is or how you can use it, the information below might help.

Who is Included? We looked at the leading talent acquisition system providers including: ADP, Cornerstone OnDemand, Greenhouse Software, iBM Kenexa BrassRing, iCIMS, Lever, Lumesse, Newton Software, Oracle, PeopleFluent, SAP, SilkRoad, SmartRecruiters, Workday

What is it? It provides an overview of the market and helps companies rethink the evaluation criteria used to select partners and what providers might meet their unique requirements. As the market becomes more complex, organizations must take a step back and reexamine what is driving success and ask new questions around technology decisions. The final section of this report includes profiles of ATS providers describing their attributes along these criteria. The appendix includes a list of providers in the ecosystem that partner with talent acquisition systems.

When does it publish? Today!

Where can we find it? Download a copy here: http://aptituderesearchpartners.com/ATS-Index-2016

Why should we care? Companies spend a lot of money on talent acquisition technology. It is hard to figure out if you are getting value from your providers and what solutions might match your unique hiring needs. Today, the decision to purchase technology is not just about price and product capabilities. It involves services, leadership, culture, and viability of these providers.

We launched this report to start a new conversation around talent acquisition systems. One that looks beyond just functionality and instead at what providers will serve as true partners. Check it out and let us know what you think!

 

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Don’t Go Changing…The Dangers of Category Creation

A street sign with directions pointing different ways labeled what, where, who, when , why and how

The HCM technology market is competitive and crowded. Providers are trying to gain market share and expand into new territory. Especially, when customers are increasing their investments and 1 in 5 companies (on average) are looking to replace their existing solutions (Aptitude’s 2016 Hire, Engage and Retain study). Given this state of the market, one trend I have noticed is that many providers are trying to get the buyer’s attention by creating new categories. They are coming up with clever names to describe very mature areas of technology investment or in some cases, inventing something new. Sometimes it makes sense but most of the time, it doesn’t. Does anyone really want to invest in an ”employee awesomeness experience excellence platform”?

You get my point.

Below are a few considerations for any solution provider that is thinking about embarking to the land of Category Creation.

  1. Budget: Does this new category align with HR Technology, workforce management or recruitment budgets? If not, buyers are going to have to build a business case for something they don’t have any idea of what the demonstrated ROI is going to be. That’s no fun and sounds like a recipe for failure.
  2. Confusion: The HCM technology market is already filled with confusion. Most companies are still trying to understand the difference between talent acquisition and talent management. Will a  new category exacerbate this confusion or bring clarity? Too often, new categories leave customers unsure of where this technology fits into the broader HCM landscape.
  3. Product vs. Marketing: There are product providers and then there are marketing providers. Which one are you? If you truly believe in your product and the value it provides, then by all means, create a category. But in many cases, providers are putting a marketing spin on a performance management system, LMS or ATS.

If you are set on category creation, then there are a few success stories that might be worth watching. Recruitment marketing is one example. A few years ago, companies had no idea what a recruitment marketing platform would look like. Today, it is a very well-recognized category thanks to providers such as SmashFly that have not only built a strong product but educated customers on the value. HireVue (video interviewing) and Globoforce (social recognition) are a few examples of other providers that have created awareness for new categories that now align with budgets and provide tremendous value.

Companies have a lot to think about when selecting the right technology. They want simple solutions that will help them do their jobs better and improve business results. Fancy names and new categories will not always help them achieve these goals.

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