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Ultimate Software is one of the larger players in the market for human capital management (HCM) software, with roots in providing human resources and payroll management products. Recently I attended its annual Connections conference. Last year the company focused attention on expansion of its global capabilities, which I analyzed, while this year it highlighted broadening and modernizing of the product suite.

A major effort in modernizing the suite was to improve the user experience for UltiPro, its HCM suite. This update reduces the number of clicks it takes to execute any task in and makes the applications visually more intuitive. In addition, the home portal design elements now resemble some that other vendors have introduced which provides pictures of a user’s team members. The user interface team, led by Patañjali Chary, VP of user experience, used advanced application design approaches such as eye-tracking models to provide information on the screen in places users expect to find it. The result feels lighter and provides visual cues to guide the user through the product’s features.

Also as part of the redesign of their user experience, Ultimate used HTML 5 to enable mobile access to  UltiPro. During the event company representatives described its approach to mobility as “responsive design.” Essentially that means the application can automatically detect the device being used and deliver a user experience designed for that device. This is an evolving capability we are seeing as more vendors strive to provide compelling user interfaces.  However, using responsive design and HTML5 to develop for mobile devices still produces some application screens that do not render cleanly for all mobile devices. I find developing native mobile applications to be a better approach, at least for the present. However, this capability should improve over time.

vr_Payroll_Management_06_what_to_integrate_with_payroll_managementUltimate’s speakers showcased three new products which expand the breadth of the suite, two of them in talent management. There is a new compensation module called UltiPro Compensation Management. This is a necessary addition for Ultimate. Our recent benchmark research in payroll management optimization shows that compensation management is a very important application to integrate with payroll management for nearly half (45%) of organizations. Ultimate’s product enters a segment in which many mature products are available; it is likely to find most use for midsize companies that already use UltiPro and have basic compensation planning needs. This addition enhances Ultimate’s expansion from a payroll and HR management vendor to providing a more complete human capital management suite.

The second major module recently released is UltiPro Recruiting, which provides applicant tracking capabilities to current UltiPro customers and follows other HCM platform vendors that have released a recruiting product in the last 12 months. I recently wrote about growth in the recruiting market.

The third new announcement expands the functionality of the core product through a time-capture device, UltiPro Touchbase. Based on technology from the company’s acquisition of EmployTouch in 2013, it is a hybrid device that users can unplug and use like a tablet as well as meeting all the needs of a standard time clock with employee punch-in and -out methods. It also adds features designed to avoid “buddy punching,” such as photo verification. This addition should help Ultimate stay competitive in the workforce management and payroll management markets where others vendors also have introduced their own time-capture devices.

Following last year’s emphasis at Connections, Ultimate has continued to expand UltiPro’s global capabilities. It released the product in three additional languages and continues a partnership with Celergo to provide international payroll capabilities. As Ultimate tries to compete in more deals for organizations that have an international presence, I believe it must invest more rapidly in this area to catch up with other vendors that have strong international capabilities, such as Oracle and SAP.

vr_Payroll_Management_01_integrated_payroll_management_provides_valueIt is clear that Ultimate Software is making significant investments in its products. In 2014 the company plans to invest more than US$100 million in product development, which represents approximately one-quarter of its total revenue for 2013. This effort should benefit its customers and perhaps win new ones. Our research in payroll management optimization finds that companies that invest in integrating their payroll and talent management functions end up with more effective core payroll processes than those that keep them separate.

Ultimate Software’s strategy is further evidence of the continuing trend of vendors of HR and payroll management software broadening their product offerings toward complete suites of human capital management applications. In recent years ADP and Ceridian have invested in this strategy, as Oracle and SAP did earlier by acquiring Taleo and SuccessFactors, respectively. While specialized stand-alone products will continue to drive innovation in segments of HCM, the move toward integrated suites is coming to dominate. This is happening for reasons on each side of the relationship. As organizations struggle to make their array of human capital management applications work together, having fewer vendors to support and more consistent product release cycles to manage can provide hard cost benefits and softer benefits of better communications between customer and vendor. From the vendor perspective it is much less expensive to cross-sell to an existing customer than it is to find and sell to new ones.

Ultimate’s investments in expanding and modernizing its products make sense, and the company is proceeding in a logical fashion. The new individual products provide expanded coverage, and the improved user experience should please customers. For organizations, especially midsize ones, that are evaluating HCM platforms and have not looked recently at Ultimate’s I recommend including them in the evaluation process.

Regards,

Stephan Millard

VP and Research Director


Human capital is most organizations’ largest investment and one of their largest differentiators against the competition. So it follows that those that take advantage of the compelling, game-changing technology now available in human capital management (HCM) will place themselves at a competitive advantage.

HCM has for the past several years been integrating and continues to integrate under one roof what have been different processes and technologies. In addition, HCM product developers have now incorporated several powerful technologies from other areas to improve the analytic power and usability of HCM tools for all users – technologies such as mobile access to systems, social collaboration platforms for learning, recruiting, performance and other parts of HCM, and powerful analytics and big data capabilities to help managers and executives make better human capital investment decisions. I believe 2013 will be the year in which we reach a tipping point for some of what are now being viewed as “next generation” technologies – the year in which they are shown to deliver compelling returns on investment to organizations and so will increasingly be adopted and will enter the mainstream.

I’ve designed my 2013 research agenda to explore the most significant HCM-related business and technology innovations and issues facing organizations. It will enable HR professionals, managers and executives to understand how to address problems facing their business so they can be maximally competitive while helping them to find best practices to apply to the practical core-HR issues that most every business faces. This human capital management practice will cover three main areas in 2013:

We will look from several different angles at how mobile and social collaboration technologies will transform the workforce. How, for example, are social collaboration technologies being used and how can they be used to engage managers and workers more effectively across the organization? Ventana Research will examine how the relationship between learning and the use of social collaboration can lead to greater business effectiveness. In 2013 we will conduct benchmark research focused on social learning and performance to explore how organizations have been using these technologies effectively and what kinds of challenges they have faced. Drawing on the 2012 benchmark research on social collaboration and HCM, we also will look at the emerging impacts of social collaboration and media technologies on the important human capital process of recruit-to-perform.

In addition, as we found in ourvr_nextgenworkforce_mobile_device_deployments_increasing 2012 next-generation workforce management benchmark research, many organizations are either planning to or already deploying tablets (44%) and smartphones (71%) across their organization to increase access to workforce management technologies. This year we will expand on this research, in our next generation HR technologies benchmark research looking further at how both early adopters and mainstream organizations are starting to use smartphones and tablet-enabled applications to make HCM more accessible and effective.

The second focus area for 2013 will be researching how managers and workers can improve many of their current human resources activities through changes in process, technology and better access to information. Over the past decade we have seen many advances in process automation in the workplace and in human resources. Some have resulted in a streamlining of business and some have not. Recent technologies such as social media, predictive analytics, big data, mobile platforms and workforce management hold promise to greatly improve the way workers and managers can manage an organizations human capital.

Social media, for example, will be one key technology that will have impact across the spectrum of HCM. In 2013 we will investigate further how social media can improve recruiting by optimizing marketing and candidate-related hiring tasks. We also see workforce management as being key to HCM success. In 2012 Ventana Research laid the groundwork with our benchmark research on next-generation workforce management, which investigated how organizations are responding to their changing workforce management needs. In the coming year we also will introduce a value index to evaluate these next-generation workforce management software offerings.

Another process innovation we will be researching in 2013 is task and activity tracking across several aspects of human capital management. Task and activity tracking has been offered for several years in workforce management applications, with activity tracking tied into scheduling and time and attendance applications. Now, however, it has evolved to have a presence in social performance management software products to make it possible for employees and managers track individual goals more effectively, and we will cover it as part of our social learning and performance benchmark research.

Another important development in human capital management is the recent introduction of predictive analytics and big data. These vr_nextgenworkforce_mobile_device_deployments_increasingtechnologies have applicability across HCM applications and many vendors have started to introduce products that bring the power of this technology to different parts of human capital management, from analytics that address one point need to full workforce planning systems. In 2013 Ventana Research will be launching both new benchmark research and a Value Index for Human Capital Analytics to assess best practices and organization adoption patterns as well as the utility and maturity of the market offerings. Our most recent assessment of workforce analytics found that organizations face significant challenges in the efficient use of technology and the optimization of workforce processes. Also relevant in this area is the finding in our research on social media and recruiting that workforce metrics can be used to justify new investments; indeed, quality of hire is the most important recruiting metric in 79 percent of organizations.

The third main area we will address in 2013 is the issue of change management in HCM processes and technology. After all, the pace of change in human resources has accelerated in recent years and I predict this increase will continue in 2013. Many, if not most, VR_TCM_Value_Index_Weighted_Overall_Ratingsorga­ni­za­tions are working to simplify and streamline their processes and use to their advantage the most promising technologies. For many this happens first in their core people processes, usually through unifying their talent management and core HR processes. In addition, as compensation is the single largest controllable expense in most organizations, streamlining the efficiency and effectiveness of payroll and compensation processes is often an important change management effort in HCM. Our total compensation management benchmark research found that improvements are still needed to increase the efficiency of analytics in compen­sation and our 2012 Value Index in Total Compensation Man­age­ment identified a short list of vendors that are capable of meeting organizations’ needs. This year we will conduct benchmark research looking at payroll optimization to understand how payroll systems are evolving to become a more strategic part of HCM by being integra­ted into compensation and other key areas.

One of the most powerful and transformative technology trends, and one where HCM has been a leader, is cloud computing. Cloud computing has dramatically changed the economics of businesses and has also had a strong impact on change management across organizations by improving the time-to-value of HCM and transforming the way software solutions are implemented and supported. This technology change has made perhaps its strongest impact on the relationship with Finance and the CFO, improving the way organizations use their capital to invest in HCM solutions and ultimately improving their ROI. We will explore the transformative value and the economics of cloud-based HCM in our benchmark research on next-generation HR technologies.

The pace of innovation looks to continue 2013 for human capital management. In my view, those organizations that embrace this pattern of change and do a reasoned but determined job of evaluating and implementing the most promising technologies will be able to lead in improving worker effectiveness. Taking the steps to unify your HCM applications, using the economics of cloud computing and applying enabling technologies like mobile platforms to increase reach and access of applications potentially will deliver to the businesses that invest in them a long-term competitive advantage over those that choose to stay with dated technologies and processes.

Come read and download the full research agenda.

Regards,

Stephan Millard – VP & Research Director

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