Seeing the value of employees more clearly: with workforce management software, banks can get...

While many application areas loudly proclaimed their presence in the big push to take market share, the unfolding of the human resource "e-volution" has been quieter. And so, you might have been fixated on your ERP system, thinking your work for support staff complete, while other options were

With banks and Fortune 1000s a bit more comfortable with the economy and seeking ever more efficiency, interest has been rising in giving human resource functions a slick new electronic face, now referred to as human resource management software (HRMS).

While some banks have experienced this first hand within the last two years or so, for the fast followers, catching up may be an interesting exercise. By last count vendors in the HRMS sector numbered in the hundreds, according to Workforce Management, a portal devoted to human resource trends. All those HR systems are designed to give web treatment to work previously stuck in manual "dead tree" or disparate fat-client system mode.

"Initially, the software was administrative, for use by HR personnel or accounting departments," said Jim Holincheck, research director, Gartner, Stamford, Conn., during a recent webcast.

"Now you're seeing companies deploy technically simpler, but more comprehensive solutions that everyone in a given company can use as part of a strategic talent management program," said Holincheck.

Although some consolidation has occurred, the market for HR software is still taking shape, with creative approaches and new solutions in the offing.

Like a CIF for employees

The idea is to develop your talent pool, in part, by building a kind of electronic employee record--accessible by portal--that makes performance and project management data more evident. Senior management and HR personnel collect key daily managerial tidbits and combine them with other information gathered during periodic hiring and promotions. Being systematic in gathering data usually kept in paper records--if at all--is said to improve objectivity (during performance reviews and training assessments), lead to fewer errors (by either informing or directly linking to systems that issue paychecks, benefits, rewards), and allow senior management to be more perceptive about talent, perhaps putting workers to better use over time. For instance, when certain projects come up, you can easily query a given system and get a list of candidates that are theoretical fits. Systems like these are designed to help management focus on details that can elude daily perspective, such as how particular skills are being leveraged over an entire department or whether a given employee is up to speed on his training.

A broader enterprise-wide human capital management system can encompass areas such as recruiting, on-boarding, career development, and incentives management. (Additionally, Holincheck indicated, employees can also self manage careers and keep track of training or additional education and skills improvement.)

Solutions at work

Because getting and keeping good talent is increasingly viewed as a critical differentiator in corporate performance, the niche is beginning to gather momentum.

"Awareness in this HR space has really increased in the last year or so," says Robert Bernshteyn, senior director, product marketing, SuccessFactors, San Mateo, Calif. One reason for this, he says, is that company's application supports hiring from within--or at least makes it viable as an option.

The idea is not to be so dependent on what's stuck in the hearts and minds of individual managers to whom HR might not have easy access--certainly not instant access. And, with demographic shifts on the horizon, corporations are beginning to revert their thinking away from constantly going outside the firm or seeking stop-gap measures.

"In the next ten years, there will be fewer workers than positions in the U.S.," Bernshteyn says. "It will be too expensive to keep going outside.

But staying inside requires some finesse. Supporting peer evaluation and management skills assessments, the application, in effect, transforms implicit knowledge of worker capability into a formal data trail. Enterprise automation gives a company a lens on many aspects of individual employee performance and strategy contribution.

"It turns out, companies that are generally more profitable tend to have certain innate characteristics as part of their culture," says Bernshteyn. "These include excellent communication, a value placed on collaboration, and an ability to garner ideas from the talent pool." And, he maintains, his companies' wares help clients track such hard-to-enumerate qualities as avidity or conscientiousness.

The need for accuracy and speed has bumped up interest in automated incentive management as well.

"Without automation, many clients couldn't properly calibrate their rewards," says Shankar Trivedi, senior vice-president & chief marketing officer, Callidus Software, San Jose.

"Only banks with an idiosyncratic rewards program would need a manual approach and spreadsheets."

Otherwise, Trivedi notes, it makes sense to automate the process, because it creates transparency and aligns the overall program perspective with individual contributors. To whit, the numbers add up and nothing gets out of whack.

"This motivates individuals and allows management to see how effort is contributing to objectives and see if adjustments need to be made due to unintended consequences," Trivedi says. The rule-based system is easy to adjust. "Without an incentive management system, sales people aren't as able to visualize their progress and management doesn't get a simple sense of what they are paying out to generate sales," he explains.

A "logistical" start--a broader future

In some ways, the wider use of tools for talent began out of the call center sector with the humble scheduling application.

"Strategic staffing improves productivity, and use of performance metrics also helps workers and management keep on track," says Chris Zaske, managing director, operations practice, Demos Solutions, Norwell, Mass.

Over the years, its SmartStaff tool has added capabilities, allowing a firm to accurately predict future volumes and workload requirements, enable just-in-time response alerts, and individual team and enterprise performance measurement. Embedded workflow and data gathering capabilities allow its clients to synchronize workflow, HR, labor, payroll, time and attendance.

Other toolsets were developed initially from the perspective of training, but again, bloomed into a broader selection of talent management options. In the mid-market, regional banks have been interested in automating key HR functions and in combining human resource and payroll data so that employee demographic information such as Social Security number, address, and benefit enrollments can be tied together for more accurate payroll deductions and better employee records, says Tom Tillman, director of product marketing, for Sage Abra, a full-service HRMS suite from Sage Software, Herndon, Va.

The company has offered web-based capabilities since 2000 and now has expanded to include talent management. Of its core group of early customers, Tillman says: "Financial services firms have been early adopters, whether they've outsourced benefits delivery or not. In the last year, there's been more interest overall in a newer capability, which is automation of the recruiting process via the web," Tillman adds.

Among non-users of such systems, there's room for improvement in the people department, it turns out.

"There's still a lot of supply-chain issues in the standard approach to hiring and managing talent," says Adam Miller chief executive officer, Cornerstone OnDemand, Santa Monica, Calif. Miller says that his company's solution has allowed one client, for instance, to hire a single full-time administrator to meet the compensation assessment and other training administrative needs for 25,000 employees. E-mail reminders automate what used to be a list and phone operation. Compliance management is one specialty of the firm, allowing management to keep track of employee training and other requirements.

One vendor--or many?

Some vendors are promising a one-stop shop--Sage Software for instance, couples administrative with basic talent management capabilities--while others sit in narrow niches and promise to easily blend with classic ERP systems from Oracle, Peoplesoft, or SAP or even with accounting systems.

As you might expect, the jury is out on which approach is best and it probably depends on what matters most to your company. Generally, the trade-offs revolve around speed of integration against the need for a deep set of capabilities in a particular area, such as sales management.

Then there are technical considerations. A Workforce Management article on integration of HRMS systems pointed out that today's ERP systems are easier to link into than earlier versions, but the HR research firm Newman Group said that all recruiting applications suffer from gaps that hamper rollouts. As with customer relationship management systems, much of this pertains to a dearth of accurate data.

The other challenge is political. Figuring out who will sponsor a new human resource application project may be as hard as any head butting of power titans in your organization.

"We're seeing it be a tug of war between Operations and HR execs who wish to sponsor this," says Bernshteyn. "HR knows that their future viability is at stake."