Let’s Blame HR!

I was looking at the title of a blog series posted by Michael Carty on the topic of “If I Could Change One Thing About HR". Here we go again, I thought. Another round of “Let’s blame Human Resources!”

I frequently read blogs,to keep up on what is happening in HR, my career of 20 years. Lately I have noticed many blogs saying that HR isn’t strategic enough, or not concerned with the bottom line, or that it is filled with incompetent people who need more training, and so on.

So when I read blogs on HR I prepare myself to feel slightly indignant. It seems like every blog blames human resources for everything from unhappy employees to lawsuits against the company for sexual harassment (how exactly is that HR’s fault?). What about the PunkRockHR blogger who wants to know if “HR is Dying: Yes? No?” In this recent post, she writes that people just try to get around HR, that it is essentially a roadblock.

Most HR professionals are hardworking, competent individuals who toil day-to-day with important tactical responsibilities - getting people enrolled in benefits programs, responding to benefits and/or insurance claim questions, getting salaries changed, assisting with performance reviews, listening to employees personal problems, and all the other required duties. Most don’t even have time to read blogs!

While this work may not earn a seat at the table and may not be strategic it has dignity. Is there something wrong with doing this job? And many of us are kind, caring individuals who took the job because with the notion of helping others. The tactical HR professionals don’t have a seat at the table but our days are entirely filled with tasks that have to be done. If they don’t get done, things go wrong very quickly.

The first blog I read had what I expected – guest blogger Sukhvinder Pabial muses about why HR professionals rarely move up the ladder to run the company:

”Quite simply it's the way HR talks about business. We don't put ourselves in a credible position which shows that we are able to have business discussions with other business leaders. And don't fool yourself into thinking you're doing this.”

I read a few of the other blogs in the series. They were all about the same. Finally, I found the 'Existentialism is an HRism' blog, written by “The HRD” who states:

“It is my belief that HR is facing its own existential crisis. We can learn a lot from the existentialists about how HR can face up to this crisis, and take charge of its actions…...we seek the approval of others by behaving in ways that we often do not believe are proper…….stop worrying about what people think of you and start doing what you believe is right. Start today, start right now. Make every action count.”

That, I can agree with!

Who'sa comin' to Chicago and HRTech Conference

I have attended the HRTech Conference for - OMGosh - about 7 years now, and I do have to say there is always this spin of excitement for me at this conference that I don't always feel at others when I know that I am going to be spending 2 days talking, talking and talking. The difference between HRTech and so many other conferences, I find that with the talking comes learning, learning and learning. Learning about the space, about the new and innovative products coming in the space and about the changes and trends that will dictate the future of the space.

If you have ever attended HRTech, there is no way that you don't get what I am saying. I mean, if you have found this blog because of a search of HRTech, you totally get it. The program of the conference is deep, rich and varied and truly will change/validate your understanding of technology in Human Capital Management.

One of the splendid things about this event are the SHOOT OUTS - oh ya! Putting vendors head to head with only the HR practitioner attendees to "vote" on who totally understands the pain points of HR departments and have dealt with it in a product that will be user friendly and valuable, and can articulate how the two components come together. This is really the opportunity for the presenters to step out of their box and truly be put to task with hard hitting and pointed questions from the audience. Almost as tense and stressful to watch as any Friday night UFC match. AND sometimes as much of a "train wreck".

This year is also somewhat suspenseful because we are all very anxious to see how the integrations of the recent acquisitions are coming along - Learn.com to Taleo; Salary.com to Kenexa; Workscape to ADP; and Softscape to SumTotal. I am sure we will see smiling exec's in the booths, but are they playing nice in the "sand box"? Keep your eyes open and make your own impression.

PS - watch for new product announcements from some large and leading companies - Kronos, Lawson, SuccessFactors and Taleo (boy Taleo is going to be busy) and HRTech is always the best place to do these kind of announcements with the number of journalists, editors and analysts that hang out there - perfect time.

Hope to see you in Chicago - and just contact me if you want to sit down and chat about things, PR, the world, marketing, organic SEO and UFC. Windy city here I come.

The power of the Tweet - Good or Evil

All powerful TweetDeck -

A very interesting situation happened to me the other day, and after the events rolled out positively the way they did, I realized that it could have had a totally different outcome. Using Twitter for “Good or Evil”.

The situation – my Mother wanted to take her two sisters visiting from The Netherlands, for a night in Toronto. Of course I suggested that they go to a very well known, historical and exclusive hotel – The Royal York. My husband and I helped them to book into a nice room, we were satisfied that we were helping them to get an “experience”. WELL let me tell you, an experience it was! Needless to say, when my Mom arrived home the next day and told me what happened, I was shocked, surprised and down right appalled. Though my Mother did speak to the front desk just before she left the hotel, and they kindly gave my aunts and Mom a complimentary breakfast. I told her – NOT ENOUGH!!!! I Tweeted my anger.

Here is the dilemma I am in – did I do this for good? – to let others know what potentially they may find at Royal York Hotel in Toronto and to help my Mom feel like her bad experience was somewhat eased? OR did I do this for evil – knowing full well the damage that this could potentially do to the hotels reputation?

Why didn’t I call the customer service line to voice my complaint and anger? Why didn’t I pen a very strong and seething email? Why did I take 10 seconds and type 140 characters of anger and then say “take that RYH”? Lazy? Easy? or Powerful?

Did I expect a response? I hoped for one, but was not sure if Royal York Hotel and The Fairmont monitored tweets – and YES they do, and within 30 minutes I received and invitation to talk to them to discuss a resolution. Within a few hours, the conversation had happened and they were more than considerate and generous with their resolution, and my Mother is very satisfied that her complaint was dealt with.

Has society (online anyway) created more than three ways to file a complaint (in person, on the phone and by email – I mean who writes a letter anymore?). We have built another communication channel to deal with customer service issues - and it worked.

What if I didn’t get a response? I am a great heroine to the world for letting them know what kind of surprises you might find in a hotel room, even a hotel like The Royal York (I will now forever check behind the window curtains the second I step into a hotel room).

I realize that the outcome of this story was a happy ending and was handled with great tactfulness by The Royal York Hotel in Toronto. But that doesn’t help me sleep any better at night asking myself – Did I Tweet for Good or for Evil?

Thoughts on Software as Content Heading into #HRTechConf

Catching up on my podcasts today while at home making lunch for my ill wife (I think I'll be next) and making enough noise in the kitchen to wake our sleeping infant son (doh!) recovering from a stomach bug, I listened to the most recent Bill Kutik Radio Show episode featuring Naomi Bloom (for the few of you not already subscribed to this cast, you may want to stop reading and listen now - http://www.knowledgeinfusion.com/ondemand/docs/DOC-7965).

Early in the interview, Bill asks Naomi about her take on where HR Technology is going, and the "sea-change" she sees now underway, and Naomi offers many thoughtful points from her position of truly unique insight.

Three very succinct points really got me thinking:

1. Multi-tenant SaaS environments offer a huge upside potential in their ability to aggregate data for benchmarking and analytics.
2. The SaaS deployment model for vendors provides the ability to deliver HR-related content such as competencies that support the broader talent functions. SaaS vendors only need to do this once and can then support all of their customers.
3. For vendors, tremendous opportunity exists to "crowd-source" to support customer service and product planning.

I think she's exactly right on all three of these points. But she's not only right for HR technology, but also very probably for every other functional business technology that's making a migration from client server to cloud-based.

Much like recruiting conferences teach me about new ways to think about marketing (since both professions and disciplines have so much in common), HR technology conferences, especially the Analyst panel discussions at the HR Technology Conference, also teach me about where business technology generally is heading.

Content

Increasingly, the content mediated via SaaS technology no longer originates with the end-user.

For example, in the past when explaining one aspect of our HRmarketer software to sales and marketing pros, I'd ask my interlocutor to imagine if those responsible for PR and Media Relations had a CRM to manage that work and imagine if it came "pre-populated" with nearly all of the contact information and intelligence they'd ever need, how useful would that be?

A year ago, that analogy was imperfect and required some imagination. Not now. Salesforce.com (software provider) acquired Jigsaw (content provider of business contact data) this year. These two had already been integrated, but clearly Salesforce sees a powerful market opportunity in the ability to provide a new CRM customer a pre-populated a prospect database with up to date information. Existing customers have a way to augment and clean their data now too. And the larger community of Jigsaw users keeps that data refreshed.

Benchmarking

This one's really fun to think about. Today, it seems to be more vision than reality.

Going back to Salesforce, they do provide a "monthly usage" report to me as an Administrator that shows me how our implementation compares to other companies of our size across a range and functions.

And one of my favorite personal productivity tools, RescueTime, offers me a weekly email report of my workday efficiency as measured by the applications I'm using on my computer. It gives me an efficiency score compared to that of an average user.

Neither of these insights really moves beyond the realm of interesting to actionable though.

We launched our own benchmarking site this year for HR professionals based on a store of data we've been sitting on and building each month via our budget survey for the free HR Vendor Phonebook and Directory. It's interesting data. I like to imagine a 10 slide presentation delivered by a VP of HR to a CFO making the case for a budget initiative with one slide pulled from our benchmarking site... but we really don't know yet how it's been used.

Crowd-Sourcing

Naomi's point about learning from your user base is a simple and powerful one. And it's easier said than done. We're now getting into deep into our own data to learn about the usage patterns of our software customers. Extracting genuine insight without being led down a dead-end path will forever be the challenge.

Deciphering "digital behavior," as a marketer and a sales professional has become a skill set I've set out to master. Reading digital behavior offers a gold mine of insight to help deliver innovation and value to current customers as well, right?

What do you see on the horizon? What should we expect from these marriages of content (from many and various sources) and function in our SaaS applications?

P.S. Looking forward to seeing you all at #HRTechConf. We'll be at booth #935 under the name HRVendors.com.

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Will HR vendors spend more time in social media or less? Is direct mail still effective? Where do your peers go to stay current on the HR landscape? Is it where you go?

Take approximately 15 minutes to share what’s working, what’s not working, and where you’ll be focusing your marketing efforts in 2011.

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Kenexa Buys Salary.com. More Integration in HR Marketplace.

Kenexa's acquisition of Salary.com is the latest big M&A story in the HR technology spaces (well, technically, that honor goes to Taleo who later the same day announced they were buying Learn.com for $125 million).

Kenexa paid $80 million for Salary.com, or $4.07 per share - a 43% premium over the previous days closing price.

I believe this is a good strategic buy for Kenexa who in their media release stated the following "compelling" reasons for the acquisition:

• Compensation management is highly synergistic with Kenexa’s current suite of talent acquisition and retention solutions.
• Salary.com has established a market leadership position in the on-demand, compensation management market.
• Salary.com and Kenexa have complementary business models as both companies deliver a combination of software and proprietary content through a subscription-based, on-demand model.
• Kenexa believes there is a significant opportunity to expand Salary.com’s adoption in large organizations and on a global basis.

What's interesting is how Kenexa's list of compelling reasons mentioned nothing about Salary.com's talent management / performance management software which would lead one to conclude little if any value was placed on anything but Salary.com's compensation management solutions.

As such, the acquisition appears to be a horizontal integration play by Kenexa which may explain the premium price of 2x revenue for a company losing over $20 million annually on just $46 million in revenue. And with just $8.77 million in cash & equivalents (down from $49 million in 2007).

So why the premium? Or was it a premium? There really is no way of knowing at the moment. 2x revenue for a SaaS is not great but it is not bad either in this economy and considering Salary.com lost $26 million and has never made a profit as a public company.

Aside from the reasons Kenexa offers for the deal, which I 100% agree with, I suspect Kenexa sees tremendous cross-selling opportunities with Salary.com and also expects to benefit from a huge reduction of costs/expenses by removing duplicate departments/operations. They can start by focussing on Salary.com's bloated selling/general/admin expenses of $37 million. Salary.com's R&D expenses of $10 million may also be reduced since Kenexa no longer needs to fund Salary.com's talent management software pursuits - which never really gained traction. In fact, it would not surprise me to see Salary.com profitable within 18 months and for the deal to pay for itself within five or six years after that. So maybe Kenexa did not pay a premium.

Whatever the case, I do think this is a win for customers and a win for both Kenexa and Salary.com and arguably for shareholders (unless you bought prior to 2009). The deal also illustrates the continuing challenge for cash strapped companies in the HR marketplace and how difficult it can be to grow horizontally outside your core competency.

The deal ends a very interesting ride for Salary.com as an independent company.

Founder Kent Plunkett started the company in April 1999 and raised just $8 million before taking his company public in February 2007 at $13.50 and bringing in $175 million - a 22x exit value to capital used ratio! Very impressive. The company's stock peaked in October of 2007 at around $16 before a long, downward slide to the acquisition price of $4.07 - down 69% since the IPO.

Best of luck to all parties.

Post by HRmarketer CEO Mark Willaman. Join Mark on LinkedIn and Twitter.