If you are a talent management systems owner, buyer, or vendor I recommend you read this - it is filled with important information about the state of customer satisfaction, what drives vendors to deliver higher results, and analysis of various considerations for selecting and implementing a system. (You can purchase the report independently or packaged with our big Talent Management Systems 2010 Industry Study. Research members have full access to both reports in the library.)

Preface:

The Talent Management Systems market (which we define to include software platforms for performance and succession management, recruiting and applicant tracking, compensation management, and learning management) is over $2.8 billion this year and growing at over 20%. There are more than 40 providers of such systems, and we publish market share and vendor details in our research.

We know from our Talent Management Factbook® research that these systems can be used to drive tremendous business value. Companies with superior talent management processes (measured as the top 10% in process maturity among 62 different processes) generate 26% greater revenue per employee and show many other benefits as well. While Talent Management Software does not DO talent management (managers do this), these systems are now considered fundamental to the automation and global rollout of strategic talent programs and they generate tremendously high ROI.

A Few Customer Satisfaction Findings:

Our research studied more than 900 implementations across 20+ different vendor solutions. Without disclosing too much detail (we encourage you to read the report), we found the following:

• General customer satisfaction across all vendors and all markets is medium to low. Across all dimensions, on a 1-5 scale (where 1=highly satisfied and 5 = very dissatisfied) buyers rate their systems between 2 and 3. Buyers are fairly happy with product features and functional capabilities but often struggle with implementation services, support, and integration with other HR systems.
• The biggest area of dissatisfaction is with "data and systems integration," a problem caused by the immaturity of the market and newness of the SaaS offerings. The ERP vendors (Oracle, PeopleSoft, SAP), surprisingly, scored the lowest in integration satisfaction. Vendors are working to build more end-to-end suites, which will somewhat alleviate this problem. In larger organizations, however, the essential problems companies face is the existence of several older HRMS systems and now several talent management systems (typically a recruiting system, a learning management system, and a newer performance and succession management system). Most buyers struggle to integrate these important systems into a cohesive solution.
• Satisfaction with product features and functionality is relatively high. The highest rated area of these systems is the products themselves. The reason for this is that most buyers cannot ever use even a fraction of the functionality provided. They key here is to identify the few critical features you need and select a system which offers these features.
• Customer satisfaction varies widely by vendor. Our research shows that vendors which focus very heavily on one core market (mid-sized, enterprise, or global enterprise) tend to outperform their peers. We also find that different suppliers have very different "philosophies" of client service: some focus heavily on product excellence; others focus heavily on sales and marketing; others take an end-to-end solutions focus to their customers and are now developing vertical solutions. As this market grows and matures, our research shows that vendors that take the latter strategy will outperform the others (both financially and in terms of customer satisfaction).