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Both Good and Troubling Signs for HR IT

Thursday, October 23, 2008
Both Good and Troubling Signs for HR IT

The 11th Annual HR Technology Conference & Exposition may have been incredibly successful, but nagging questions about the economy hung over the conference. Electronic polls of attendees revealed important insight into current business conditions, plus some expectations for the future.

By Bill Kutik

 

I've just returned from another incredibly successful HR Technology Conference, but please don't believe the co-chair who has co-created the program content for all of its 11 years. Instead, ask the senior HR practitioners and HR IT people who attended the conference and the record number of 240 vendors that exhibited in the trade show, dozens of them in enormous booths. Or check out one of the bloggers listed at the bottom.

While total attendance was basically flat at 2,000 -- same as our record 2007 event -- most people thought maintaining that number was a miracle in the current economy, and I did, too! Attendees flew to Chicago from 16 countries on five continents to pack the sessions, which some of them told me they loved (hardly a scientific sample).

Exhibitors who mentioned it (another unscientific sample) were pleased with the executive level and seriousness of practitioners who stopped by their booths. Nearly 80 percent of this year's booths have been re-signed for next year, a vital metric of success in the trade show business. Of course, the vendors don't have to start paying for them until the end of January.
 
snip

We got some snapshot answers to that question during the annual Industry Analyst Panel. We opened the session by electronically polling the audience of 1,268: a mixed group of practitioners, IT people and vendors with full conference tickets. Here are the questions and answers. Unfortunately the raw number of votes will not be available until later:

End-users only: What effect has the economy had on HR IT in your company since June 30?

 

Postponed purchase or subscription to new software and services: 23.0 percent

Eliminated some of the above: 10.7 percent

No effects: 66.3 percent

End-users only: What effect has the economy had on these other activities since June 30?

Postponed consulting, system integration, or system upgrades: 21.6 percent

Eliminated some of the above: 9.5 percent

No effects: 68.9 percent

Vendors only: What decline have you seen or projected in revenue since June 30?

 

5 percent: 6.0 percent

10 percent: 8.0 percent

15 percent: 14.0 percent

20 percent: 19.0 percent

More than 20 percent: 9.0 percent

No decline: 44.0 percent

Keep in mind, only 111 votes were cast for this last question. Also if some devilish end-users were pushing "More than 20 percent" on their keypads to create a bargaining chip for their next vendor negotiation!

But the conclusion is inescapable: More than half of vendors voting expect their business to go down and one-third of end-user companies voting are making it happen already by postponing or eliminating HR IT projects or purchases.

Lately, I've found myself reminding friends (and myself) that three-quarters of Americans still had jobs during the Great Depression; factories still made things; people still had money to buy them.

In the same vein, the next question showed clear evidence that companies are still buying technology products for HR. Note the question asked with "budget approval."

Which application is your top priority for purchase or implementation in the next year and you have budget approval (select one)?

 

Portal or Self Service: 13.3 percent

Performance Management: 18.3 percent

Succession Planning: 6.8 percent

Compensation: 4.7 percent

Recruiting: 16.5 percent

Career Development: 1.8 percent

LMS: 10.0 percent

HRMS: 20.8 percent

None: 7.89 percent

No surprise that Performance and Recruiting are so high. They have been No. 1 and No. 2 for the last four years, at least. And Portals and Self Service are still far from ubiquitous, despite conventional wisdom.

But I was surprised at the size of the HRMS number, since our attending companies skew high: more than one-third above 35,000 employees. But half have fewer than 5,000 employees, and they are probably more likely to be replacing HRMSes. (Don't tell Dave Duffield at Workday, who's now targeting the big guys.)

Remember, these are just snapshots of a self-selected audience. Lexy Martin's annual Cedar/Crestone HR Systems Survey, which debuted at HR Technology for the third year, is more thorough about future buying patterns, especially since respondents could pick more than one product in her survey! And our buying list left out "Analytics," a big category in her results. But the Cedar/Crestone data on planned purchases was largely gathered before our current economic crisis got so serious.

On a cheerier note, my two favorite moments were talking with Kiran Bhalodia of Gujarat, India, and Chuma Ofoche from Lagos, Nigeria. They had both flown to Chicago in search of HR technology knowledge and products that they just couldn't find at home. Imagine, all that way?!?

Every year, I ask attendees who have come a long way to stop me to talk. Those two did, along with a fellow from New Zealand and many from the U.K. and Canada. But I still missed chatting with our attendees from Australia, Malaysia, China, Pakistan, Egypt, Finland, Romania, The Czech Republic, Italy, Germany and Belgium.

Maybe next year -- depending.

Check out these blogger reports of the conference: Vinnie Mirchandani of Deal Architect, Jason Corsello of Knowledge Infusion, Zach Thomas of Forrester Research, Larry Dunivan of Lawson, Mike Smith of Ventana Research, and Brian Sommer of TechVentive.

HR Technology Columnist Bill Kutik is co-chairman of the 12th Annual HR Technology Conference & Exposition® in Chicago, earlier than usual next year on Sept. 30 to Oct. 2. He is also host of The Bill Kutik Radio Show. He can be reached at bkutik@earthlink.net.


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