The Human-Capital Factor

Virtually all forms of IT have been designed to boost employee or corporate performance in some way, but the category called workforce productivity (also known as workforce optimization or human-capital management) is especially fertile. Vendors abound in all its subcategories, and while there has been a noticeable movement toward consolidation, which companies will dominate the space is still an open question.

Many vendors cut across all the categories cited below, with product suites that address the entire "employee life cycle." Note that we did not include vendors in every category in which they play, nor are the listings at the end of each segment comprehensive. ERP vendors, for example, address most or all of these categories, and BI vendors are beginning to embrace HCM as well.

Recruitment-Management Systems
Among the more active areas of human-resource software, says Josh Bersin of Bersin & Associates, is recruiting — or talent acquisition, as it's called in strategic HR circles. "Every vendor seems to be offering recruiting systems," he says. Think Monster, Resumix, and Jobster. Those are just three choices in the crowded recruiting-software market.

More than just a system that stores and searches résumés for keywords, recruiting software is touted as a way to save money by streamlining the hiring process and to work more effectively by better matching candidates to available jobs. The software is typically offered via an on-demand subscription service. The reason, says Bersin, is that a lot of the functionality that goes along with hiring and recruiting, such as creating job postings, and collecting and storing résumés, can be easily delivered via the Web. Add to that the cyclical nature of hiring, and it seems logical for organizations to go with a subscription-based service. Still, many vendors do offer recruiting software as a traditionally licensed product or module within a broader suite.

Recruiting systems aim to help organizations improve the processes of recruiting and hiring by quickly prescreening, sorting, and storing résumés, and then matching those résumés to available job openings. Some systems also include modules for various administrative tasks, such as background and reference checks, and skills assessments. Some vendors, including BrassRing LLC in Waltham, Massachusetts, offer so-called "talent life-cycle management" software that encompasses a range of processes spanning recruiting, training, and internal hiring.

Other companies vying for a piece of the recruiting action include Deploy Solutions, Peopleclick, and Webhire. In June, Authoria acquired Hire.com, and in July, Jobster acquired WorkZoo, two deals that signal the continuous merging of functionality that currently characterizes the HRMS market.

Learning-Management Systems
For organizations large and small, training is an essential component of developing a workforce. Learning-management software essentially delivers training to the desktop (often via a Web browser) and allows organizations to track and monitor which employees receive training, when they are trained, and how well they understand the training material. Such systems are particularly relevant in industries that are bound by regulation and compliance issues (such as finance and health care) or that require employee certification. Learning systems are also deployed to train employees on new products, either those they are using internally or those they are selling to customers. "Suppose your company has a new finance system; you can use this type of technology to verify attendance to classes and then centrally test their comprehension," says Frank Russell, CEO of GeoLearning Inc., a vendor of managed-learning services.

Learning-management systems are based on foundational software that acts as a database or administrative hub, tracking employees, course content, and other components. On top of that may sit content-creation tools and other middleware that helps distribute content. And then there is the training content itself, which can be developed in-house or obtained from a universe of third parties.

As for ROI, companies can expect savings simply by making training materials available electronically rather than on paper, as well as by eliminating travel to a central training facility. "Cost avoidance can be a primary reason for deploying learning systems," says Charlie Gillette, CEO of learning-systems vendor Knowledge Anywhere Inc. Yet efficiency is just one argument. As Bersin notes, "Sometimes you can't do something without a learning system. You may need to quickly train your sales force prior to the launch of a new product, for example. That's where there is real value in the technology."

Plateau, SumTotal Systems, Intellinex, Saba, and Convergys are among the vendors in this space.

Performance and Compensation Systems
Practically every organization regularly reviews the performance of its employees, a chore that most managers happily confess is the bane of their existence. The aim of performance-management systems is to both automate the employee-review process and link reviews to organizational performance. Are employees taking definitive steps to achieve their sales goals? Are there succession plans in place for top managers? What kinds of skills will the organization need in the next two years? Those are the kinds of questions that performance-management systems put at the desktops of both managers and employees.

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