Unless you’ve been living under a rock, you’ve noticed a lot of moving and shaking going on in the HR software industry. While mergers and acquisitions are always interesting for industry analysts, the most recent bout of activity – including the acquisitions of Rypple and SuccessFactors by Salesforce and SAP (respectively)–and now Taleo by Oracle–as well as the announcement of VC funds flowing into the market (with large investments in SmartRecruiters and iCIMS) – are particularly exciting. Why? Because this activity is driving change in areas of talent management technology that we primarily paid lip service to in 2011.
With two major players taking action, the market in 2012 is poised for the continued expansion of HR solutions into the Cloud, as well as further integration of social media functionality across the full spectrum of HR applications. To that end, 2012 will see more large software companies making strategic moves in the talent management niche as they fight for the biggest piece of the pie.
Kyle Lagunas, HR Analyst at Software Advice – an online resource for reviews of HR software – has taken an in-depth look at what SAP and Salesforce stand to gain from their HR acquisitions, how it will impact this dynamic software market, and where other contenders in this space might make moves of their own in 2012.
As vendors great and small continue developing Cloud-based solutions, I believe there are three HR applications that offer the greatest opportunity for strategic growth through acquisition in 2012: talent management software, applicant tracking and recruiting software, and analytics and reporting applications. And in these areas, there are a few vendors who are ahead of the pack.
- Because business leaders increasingly see the value in a system for developing their workforce,Talent Management Software continues to experience rapid growth in the Cloud. This sector has also seen some movement, as large vendors acquire best-of-breeds, particularly in learning management and performance management. As Schiemmer points out, “Flabby and out-dated HR software will have to move over as there are lean and more efficient solutions emerging, one of which is HiringBoss.”
- Many of the core functions of Applicant Tracking and Recruiting Software thrive in the social media arena, and it makes sense that you’ll see more social capabilities evolving in this area first. But Schiemer warns “lower quality ATS’s, irrespective of their size, will start to feel the pinch as providers offering better value and more flexibility take market share.”
- Your ability to identify and track trends in your retention rates, boosts in productivity, and benchmark performance will set your HR department apart from your competitors. And though HR has never had a problem with gathering data, HR software is recently making great strides in delivering technology that allows them to use that data. Analytics and Reporting Tools will continue to drive innovation in HR software.
Take a look at his full analysis and forecast on his HR blog at: http://blog.softwareadvice.com/articles/hr/the-hr-software-round-up-setting-the-stage-for-2012-1011912/.