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Bersin by Deloitte Research Shows Organizations Plan to Replace or Buy New Human Capital Management Software to Support their Workforces in the Next 18 Months

Buyers seek replacements for Human Resource Information Systems (HRIS), a better end-user experience, faster technologies, improved integration across talent platforms and improved analytics  

OAKLAND, Calif., April 7, 2014Bersin by Deloitte today announced new research showing that after years of recessionary budget cuts, most (90 percent) organizations surveyed indicate that they plan to replace their Human Capital management (HCM) software within the next 18 months. Bersin by Deloitte, a leading research and consulting firm empowering Human Resource (HR) organizations to drive bottom-line impact, included the findings in its new research report, Investments in Human Capital Management Systems 2014: What Technology Users Have and What They Will Buy in the Year Ahead. The research is available now to WhatWorks® members via BersinInsights™, the personalized and integrated member information platform.     

Human Capital Management is the term applied to all large scale HR-related platform software – Talent Management Systems, Learning Management Systems, and Human Resource Information Systems (HRISs), which serve as the core HR systems of record. Summarized in a complimentary WhatWorks® brief, the research shows that more than twice the percentage (at 39 percent) of global organizations are planning to replace their HRISs than were a year ago, when just 14 percent of global organizations had such plans. Singling out performance management and hiring management systems that cannot be integrated as the ripest for replacement, organizations studied indicated they have plans to acquire or replace both talent management and HRISs in the next 18 months.  

“The top themes for software acquisition remain remarkably consistent,” said Katherine Jones, vice president, HCM Technology Research, Bersin by Deloitte, Deloitte Consulting LLP. “Seventy-four percent of respondents in the market for a replacement HCM system sought to improve their users’ experience, recognizing that new, better and faster technologies are available in the market today. The ability to integrate the entire range of HCM software to improve access to analytics and decision-making were also key drivers.”

The research is based on a study of 134 senior corporate users of HRIS software, talent management suites and standalone talent management software applications. Half (50 percent) of respondent organizations have $1 billion or more in annual revenue. The data was collected by working with Human Resource Executive magazine. The study looked at many different factors, including the solutions the respondents are using today (both their talent management and HRISs), the length of time they have been using these solutions and the changes they intend to make and have budgeted for in the year ahead.     

Criteria for buyers planning to replace or buy new software in 2014 differ somewhat depending on the planned acquisition. The research revealed that:

  • Better analytics and reporting capabilities emerged as the number one criterion for buyers of a replacement HRIS. Nearly half (47 percent) of respondents have had their HRIS solutions for seven or more years. 
  • One half (50 percent) of large organizations have owned their HR Management Suites/HRISs for more than seven years. 
  • Improving the end-user experience was the key motivator for those seeking an integrated management suite. Seventy-four percent of respondents who are replacing an HR system sought to improve the experience of their users.
  • The ability to integrate with other talent and business applications was the key driver for those moving from standalone applications to a suite. Seventy-five percent of suite-seekers want integrated learning and development, performance management, recruiting and onboarding.  

The research also found that cost ramifications as a driver are more important to HRIS/HRMS buyers than to talent management system buyers. Global capabilities are among the top five drivers for those moving from standalone applications to an integrated suite. Customization is most important to those acquiring an integrated suite for the first time.     

In addition, the study results showed that more than half (58 percent) of multinationals are planning to replace their HRISs/HRMSs, and more than two-fifths (42 percent) of national organizations plan to replace these systems.

Please register to join Dr. Katherine Jones for her online webinar, Unleashing the HR Budget:Buying Trends for HR Investments at 2 p.m. Eastern on May 29, 2014.      

Those interested in learning more about Bersin by Deloitte or its WhatWorks® membership may email info@bersin.com or call 510-251-4400.     

About Bersin by Deloitte

Bersin by Deloitte delivers research-based people strategies designed to help leaders and their organizations in their efforts to deliver exceptional business performance. Our WhatWorks® membership gives Fortune 1000 and Global 2000 HR professionals the information and tools they need to design and implement leading practice solutions, benchmark against others, develop their staff, and select and implement systems. A piece of Bersin by Deloitte research is downloaded on average approximately every minute during the business day. More than 5,000 organizations worldwide use our research and consulting to guide their HR, talent and learning strategies. For more information, please visit http://www.deloitte.com/bersin or http://www.bersin.com.     

As used in this document, "Deloitte" means Deloitte Consulting LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.     

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Laura Evenson

Communications

Bersin by Deloitte

Deloitte Consulting LLP

+1 415-465-2711

levenson@deloitte.com