Enterprises Focus on Human Capital in Response to Changes
Enterprises are increasingly investing in HCM technologies to enhance agility and workforce management, with a focus on AI-driven automation and personalized employee experiences, as per the 2023 ISG Provider Lens™ report. The report highlights the growing importance of unified HCM platforms for data insights and tools to navigate changing business conditions efficiently.
The integration of Human Capital Management (HCM) technologies is a strategic move by enterprises aiming to enhance operational agility amidst market uncertainties. The shift towards AI-driven automation and personalized employee experiences is reflective of the broader digital transformation trends across industries. The demand for unified HCM platforms suggests a growing market for vendors that can offer sophisticated, integrated solutions. This trend is likely to influence investment decisions and partnership opportunities within the tech sector, potentially affecting the valuation of companies that are leaders in this space.
From a stock market perspective, the report's identification of leaders and rising stars in the HCM technology space offers investors a roadmap to companies that may experience growth due to their innovative solutions. The emphasis on AI integration could signal long-term growth for tech companies that are at the forefront of AI HCM applications, as their products become increasingly indispensable to enterprise operations.
As enterprises invest in HCM platforms, there is an implied expectation of ROI through improved workforce management and operational efficiency. This investment is not merely a cost center but a strategic enabler that can lead to cost savings through automation and better talent management. Financially, companies that can leverage these platforms effectively may see reduced HR operational costs and enhanced productivity , which could positively impact their bottom line.
For investors, the growth of the HCM market suggests a need to monitor the financial health and R&D investments of companies that produce these platforms. Those that continuously innovate and align with enterprise needs—especially in AI—may provide attractive investment opportunities. However, investors should also be aware of the implementation risks and integration challenges that companies may face with these technologies, which could impact expected benefits.
The report highlights the importance of interoperability and user experience in HCM platforms, which are critical factors for successful technology adoption. Companies that prioritize these aspects in their HCM solutions can gain a competitive edge by enabling seamless integration with existing systems and ensuring high user engagement. The focus on consumer-like experiences and real-time insights into workforce sentiment reflects a deeper understanding of the human element in technology adoption.
For businesses, the strategic use of HCM technologies can lead to a more resilient and responsive workforce , which is crucial in a rapidly changing business environment. The ability to quickly adjust resources and respond to employee needs can result in a more adaptive and innovative organization. This approach to workforce management can become a significant differentiator, potentially impacting market competitiveness and investor perception of a company's future prospects.
03/14/2024 - 01:01 PM
Companies are turning to HCM platforms to better understand workforces, adjust resources on the fly, ISG Provider Lens™ report says
STAMFORD, Conn. --(BUSINESS WIRE)--
Enterprises are investing in human capital management (HCM) technologies to improve their agility in uncertain times, according to a new research report published today by Information Services Group (ISG ) (Nasdaq: III ), a leading global technology research and advisory firm.
The 2023 ISG Provider Lens™ global HCM Technology Platforms report finds that organizations are turning to unified HCM platforms for reliable data insights and effective tools that allow them to pivot more quickly as business conditions change. More enterprises are seeking new HCM capabilities, including AI-driven automation, personalized employee experiences and innovations that allow HR organizations to do more with fewer resources.
“For a growing number of enterprises, change is mission critical,” said Stacey Cadigan, partner, ISG Human Capital Management and Enterprise Transformation. “HCM platforms provide data insights that make complex organizational changes more manageable.”
AI is becoming a core element of many HCM applications as organizations embrace efficient, accurate automation of HR tasks, the report says. They are relying on AI to evaluate resumes, give employees tailored career advice, offer training, make personalized decisions on benefits and ensure payroll compliance. As generative AI (GenAI) matures, ISG expects nearly every HCM technology vendor to integrate it into their solutions in the coming years.
Enterprises investing in HCM platforms are also looking for more consumer-like user experiences for their employees, ISG says. Over the past two years, platform vendors have carried out major upgrades to make their systems as approachable and easy to use as online platforms such as Facebook, Snapchat or Amazon.
Interoperability among HCM tools is another high priority for enterprises, the report says. Companies want to be able to add components, such as a recruiting platform, while maintaining a consistent base of data across all elements of the solution. Providers are meeting this need by using web services, microservices architectures and modern integration toolsets.
Many enterprises are also focused on improving employee engagement in response to digital communication fatigue, overworked employees and rising employer-employee tensions that have led to lower engagement scores, ISG says. HCM vendors are introducing solutions that provide real-time insights into workforce sentiment and help companies manage employee needs.
“Enterprises know that productivity and growth require an engaged workforce,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “Vendors are meeting demands for tools that help companies stay connected to employees.”
The report also explores other HCM platform trends, including the increasing importance of retraining current employees and more efficiently recruiting the best new hires.
For more insights into the HCM challenges enterprises face, including the growing need for HR departments to prove their value to the business, and advice on how to address them, see the ISG Provider Lens™ Focal Points briefing here .
The 2023 ISG Provider Lens™ global HCM Technology Platforms report evaluates the capabilities of 29 providers across three quadrants: Core HCM Technology Plus Talent Management – Large Market, Core HCM Technology Plus Talent Management – Small Market and Midmarket, and Best-of-Breed ATS.
The report names ADP, Dayforce, Greenhouse, iCIMS, isolved, Jobvite, Oracle, Paychex, SAP SF, SmartRecruiters, UKG and Workday as Leaders in one quadrant each.
In addition, Darwinbox, HiBob and PageUp People are named as Rising Stars — companies with a “promising portfolio” and “high future potential” by ISG’s definition — in one quadrant each.
Customized versions of the report are available from HiBob and isolved .
The 2023 ISG Provider Lens™ global HCM Technology Platforms report is available to subscribers or for one-time purchase on this webpage .
About ISG Provider Lens™ Research
The ISG Provider Lens™ Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across Europe , as well as in the U.S. , Canada , Brazil , the U.K. , France , Benelux, Germany , Switzerland , the Nordics, Australia and Singapore /Malaysia , with additional markets to be added in the future. For more information about ISG Provider Lens research, please visit this webpage .
A companion research series, the ISG Provider Lens Archetype reports, offer a first-of-its-kind evaluation of providers from the perspective of specific buyer types.
About ISG
ISG (Information Services Group) (Nasdaq: III ) is a leading global technology research and advisory firm. A trusted business partner to more than 900 clients, including more than 75 of the world’s top 100 enterprises, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes in digital transformation services, including automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn. , ISG employs more than 1,600 digital-ready professionals operating in more than 20 countries—a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry’s most comprehensive marketplace data. For more information, visit www.isg-one.com .
View source version on businesswire.com: https://www.businesswire.com/news/home/20240314158648/en/
Press Contacts:
Will Thoretz, ISG
will.thoretz@isg-one.com
Julianna Sheridan, Matter Communications for ISG
isg@matternow.com
Source: Information Services Group, Inc.
What is the focus of enterprises investing in HCM technologies according to the ISG Provider Lens™ report?
Enterprises are focusing on enhancing agility and workforce management through AI-driven automation and personalized employee experiences.
Which technologies are organizations turning to for reliable data insights and effective tools as per the report?
Organizations are turning to unified HCM platforms for reliable data insights and effective tools.
What are some key capabilities that enterprises are seeking in new HCM platforms based on the report?
Enterprises are seeking AI-driven automation, personalized employee experiences, and innovations to do more with fewer resources.
How is AI being utilized in HCM applications according to the report?
AI is being used to automate HR tasks, evaluate resumes, provide tailored career advice, make personalized decisions on benefits, and ensure payroll compliance.
What are enterprises looking for in terms of user experiences for their employees as mentioned in the report?
Enterprises are looking for more consumer-like user experiences for their employees, similar to online platforms such as Facebook or Amazon.
