Integrated, Interoperable, and Organic HR Technology
Recently, I’ve noticed a few people I highly respect getting caught up in a fallacy being perpetrated by a handful of HR technology vendors. In their marketing, these vendors coined the term "organic" to refer to their software and make the argument that this organic approach makes their software better.
Why They’re Wrong
Organic or organically integrated HR Software, defined by one of these people whom I respect as applications built from the ground up to be inherently connected, is really just the vendor’s way of arguing that we should buy everything from them. One such vendor even demands it – you can’t just buy the tools you need; you have to take everything they offer in HR and Talent Management, like it or not.
So how is it that these highly respected people – people who have been driving thought leadership and innovation in the HR and talent management software space literally since its inception – got it wrong? Their technology resumes destroy mine. They use phrases like "systemically effective-dated" and "inheritance across and within tenants." They are HR technology experts. Compared to them, I’m not.
I am, though, an expert in HR strategies and processes, have worked my entire career helping organizations drive productivity and engagement, have been fortunate to consult with more than half of Fortune’s 100 on HR transformation, and have personally been on the front lines of delivering HR services to "the business."
And so I’ve chosen my words very carefully here. The definition of fallacy is: "a mistaken belief, especially one based on unsound argument." And that unsound basis is precisely the issue. The reason these HR technology pioneers are getting it wrong is that they are putting technology, not people, at the forefront.
In a vacuum, the idea of organic HR software makes sense. We need systems that operate from a single source of truth when it comes to the core data used to drive actions and transactions — data like people records, organization structure, and hierarchy. We need our talent management technology to facilitate integrated processes. We need a common user experience. And we need that technology to keep working when its upgraded or changed, not to be left with a bunch of broken integrations.
Putting People Back in Focus
The organic approach only works, however, if you are solely considering the technology. If you put people and the realities of most organizations at the front of the equation, you see the argument’s unsound foundation.
1. Driving productivity and engagement means marrying HR and talent management interventions with people’s daily work. People use many software tools to do their work that are not now, nor will they ever likely be, provided by any one vendor.
2. Integrated data needed to enable our people and make better talent related decisions is not just HR data – it’s business data, and should therefore include other, non-HR, systems data.
3. There are, and again likely always will be, new innovative technologies entering the HR space that solve our people challenges in significantly different ways that are just too important to pass up.
4. Most organizations already have multiple HR systems – the average is 11 – and can’t afford to rip out their existing infrastructure and replace everything with software from one vendor, even if "everything from one vendor" existed (see points 1-3).
Don’t Just Take My Word for IT
Another person I highly respect, and whose technology resume destroys mine, gets it right. Josh Bersin, founder of Bersin by Deloitte, a company that delivers research-based people strategies designed to help leaders and their organizations deliver exceptional business performance, shared his thoughts in a blog post he wrote in 2012, The Integration of Talent Management Systems Comes to Forefront.
He explained, "It is nearly impossible to innovate in all areas of talent management fast enough to stay ahead. So rather than build a product set which is ‘barely good enough,’ most vendors buy a best-of-breed software company and integrate it with the rest of their suite (acquiring specialized skills in the process)."
More recently, in a response to a post on the benefits of organic integration on LinkedIn, he nailed what the future of HR technology should look like: "I'm sure Google Maps has location aware APIs and we're going to have time-aware APIs in all the various Internet of Things systems companies are building — so the future of 'integration' is lots and lots of high powered interfaces connected to each other. Look at how easy it is to use G+/Twitter/Facebook/LinkedIn/Discus APIs to login all over the Internet. And look at Waze. Whew. That's how our internal HR systems should work."
Interoperability is the Key
Standards emerging from consumer technologies and the Web Internet allow functions within software products to be invoked as needed, rather than one program handing off to another. Service-oriented architectures (SOA) enable integrated business processes across disparate software products. Master data management (MDM) technology creates a virtual single source of truth for information from multiple systems. We need HR and talent management technology with these attributes built in.
Consider this: We use interoperable technology all the time outside of the workplace. As Josh mentioned, we use our Facebook login to access other applications (that’s actually a transfer of core data), we play games imbedded in social applications, we share photos via mobile operating systems to those same social applications, and on and on. We should expect the same level of interoperability from our HR technology.
It is true that most HR technology isn’t highly interoperable. For example, right now there are no Cloud-computing standards accepted by most of the major commercial cloud providers. Perhaps that is why "integration complexities" always tops of the list of concerns about moving to SaaS HR systems in the annual CedarCrestone HR Systems Survey.
Steve Boese, co-chair of the HR Technology Conference, the world's largest gathering of the global HR Technology community, and a Human Resource Executive magazine editor, points out that these complexities aren’t just experienced in large organizations:. "The main realization for the HR leader at a smaller organization is that even a simple systems landscape can get complicated and inefficient very quickly. Once a ‘second’ system is deployed (it could be for employee scheduling, tracking time and attendance, or even performance management), the complexity level of the overall HR-technology platform has just doubled."
"And if these systems need to ‘talk’ to each other regularly to complete a business process or enable a full view of HR and workforce data, but are not designed to work together, do not share a similar deployment model or have wildly differing user experiences, then, all of a sudden, a simple technology environment becomes complex."
Interoperable HR Technology is a Reality
There are vendors that are delivering highly interoperable HR technology today, built on the open standards described above. And more than organic, this is what we should be demanding.
Microsoft, a company with a pretty good understanding of technology, explains the benefits of interoperability:
1. Reduces operational cost and complexity – Customers will continue to have mixed environments for the foreseeable future. The ability for these systems to work together reduces the cost of building and supporting a heterogeneous infrastructure.
2. Enables best-of-breed deployments – Customers may have business requirements that can only be delivered with specific applications or platforms.
3. Leverages existing investments – Customers have a large and diverse range of systems installed in their environments. The move to new platforms needs to be gradual and evolutionary.
Regarding the second point above — and I think it’s pretty important — the same HR technology vendors touting organic often offer "out-of-the-box best practices." They do this to limit the need to "personalize" the software to meet the unique needs of our organizations. This allows them to take a one-size-fits-all approach to demonstrating and configuring their software, and ensures they can implement it more cheaply and quickly and move on to the next customer.
But you can’t get best practices out of a box. By definition, creating a competitive advantage through your people processes and technology requires doing things differently than competitors.
Sandra Fisher, co-author of "An Evidence Based Review of e-HRM and Strategic Human Resource Management," Human Resource Management Review, 2012 explains, "Too much standardization and an overemphasis on ‘best practices’ may be hindering technology solutions from helping HR departments become more strategic. ‘Best practices’ will, at best, only let you perform as well as the other organizations that use them — and sometimes not even then, because ‘best practices’ may not work for every organization."
Daily Life is No Different
This organic-is-better fallacy reminds me of a recent trip to the grocery store. I saw kids’ cereal packed with sugar labeled Gluten-free. I saw "Natural" potato chips. And I saw "Organic" cookies. All were cleverly marketed to make you believe they were healthier, better. They aren’t.
We need to push back on HR technology vendors that don’t understand how work really gets done or our organizations’ complexities. We need to demand software that is designed to work well with other applications, not just with itself.
It’s time to put people, not technology, first.
Steve Parker is a vice president at SumTotal Systems and a former HR executive. At SumTotal, he uses his background and deep understanding of successful HR strategies, processes and technologies to deliver remarkable results to customers.