Hexaware Technologies Presents:

Transcription

1 Hexaware Technologies Presents: Complex HR Applications? Sourcing Strategies for your HR-IT Stephanie Moore- Vice President, Forrester Research Bill Martorelli-Principal Analyst, Forrester Research 1 Entire contents 2006 Forrester Research, Inc. All rights reserved.

2 A Global IT and BPO Service Provider 2 Entire contents 2006 Forrester Research, Inc. All rights reserved.

3 Strategies and Strengths 3 Entire contents 2006 Forrester Research, Inc. All rights reserved.

4 Managing HR IT Complexity with Offshore Sourcing Options Stephanie Moore Vice President Bill Martorelli Principal Analyst Forrester Research

5 Theme Structural factors make investments in HR IT difficult to optimize. Sourcing alternatives, including offshore firms can contribute to greater HR IT effectiveness 5 Entire contents 2006 Forrester Research, Inc. All rights reserved.

6 Agenda Challenges in managing HR IT HRMS platform landscape Sourcing alternatives for HR IT The emerging offshore alternative 6 Entire contents 2006 Forrester Research, Inc. All rights reserved.

7 Agenda Challenges in managing HR IT HRMS platform landscape Sourcing alternatives for HR IT The emerging offshore alternative 7 Entire contents 2006 Forrester Research, Inc. All rights reserved.

8 HR IT value curve Retention Value Performance Productivity Loyalty Service Efficiency Tactical Strategic 8 Entire contents 2006 Forrester Research, Inc. All rights reserved.

9 Challenges in managing HR technology Perception of HR as non-differentiating activity Limited appetite for significant HR IT investments Volatility, fragmentation in HR IT landscape» ERP leaders, HR specialists and many specialty providers compete in various HRMS segments There is no complete one-stop shop for HR IT» Challenges for HR organizations in managing multiple suppliers 9 Entire contents 2006 Forrester Research, Inc. All rights reserved.

10 Agenda Challenges in managing HR IT HRMS platform landscape Sourcing alternatives for HR IT The emerging offshore alternative 10 Entire contents 2006 Forrester Research, Inc. All rights reserved.

11 HRMS applications value proposition Tactical HRMS transactional systems objectives: Manage personnel costs Operate efficient HR business processes Meet compliance obligations Strategic HRMS applications objectives: Optimize the value of your investment in human capital through:» Performance and competency measurement» Learning and development» Talent management» Rewards and retention strategies 11 Entire contents 2006 Forrester Research, Inc. All rights reserved.

12 Trends HR transactional applications are mature, but companies need to get to a single system of employee records Performance focus: Business strategies drive individual goals and measures Our aging workforce demands proactive talent retention and development strategies Younger workers entering the market have different ways of absorbing knowledge and adapting to corporate cultures Software-as-a-service (SaaS) is well established in HRMS applications, blending more with outsourced services SOA technology is starting to affect software delivery and partnering strategies 12 Entire contents 2006 Forrester Research, Inc. All rights reserved.

13 September 2006, Tech Choices The Forrester Wave : Human Resource Management Systems, Q HRMS application footprint 2006, Forrester Research, Inc. Reproduction Prohibited

14 September 2006, Tech Choices The Forrester Wave : Human Resource Management Systems, Q Forrester Wave HRMS Q3 06 multinational enterprises 2006, Forrester Research, Inc. Reproduction Prohibited

15 September 2006, Tech Choices The Forrester Wave : Human Resource Management Systems, Q Forrester Wave HRMS Q3 06 US midmarket 2006, Forrester Research, Inc. Reproduction Prohibited

16 January 2006, Market Overview HR/HCM Applications: Strategic Processes Move To The Forefront HRMS market overview Base: 2006 worldwide HR/HCM application license and SaaS revenues Core HRMS is the largest segment at $5 billion, or 48% of the total market Best-of-breed segments are dynamic: Recruitment mature and fragmented Workforce management mature concentrated Performance and talent management rapidly evolving Learning management benefiting from new technology 2006, Forrester Research, Inc. Reproduction Prohibited

17 January 2006, Market Overview HR/HCM Applications: Strategic Processes Move To The Forefront HRMS segment growth analysis 2006, Forrester Research, Inc. Reproduction Prohibited

18 Complementary solution providers Representative vendors Performance and talent management Recruitment Learning management Authoria, Halogen, Softscape, SuccessFactors, Workscape Deploy, icims, Kenexa, Taleo, Trovix, Vurv Connexys, Jobpartners, MrTed SumTotal, Plateau, Saba Workforce management Cybershift, Kronos, ScheduleSource, Stromberg, TimeLink, Workbrain 18 Entire contents 2006 Forrester Research, Inc. All rights reserved.

19 What it means: the future of HRMS applications Software-as-a-service will become a primary delivery model for most HR/HCM applications Process outsourcing will become more closely linked to the technology solution Best-of-breed solutions will continue to prosper via SOA integration Vendor consolidation will proceed along horizontal and vertical paths:» Roll-ups» Talent management suites 19 Entire contents 2006 Forrester Research, Inc. All rights reserved.

20 Agenda Challenges in managing HR IT HRMS platform landscape Sourcing alternatives for HR IT The emerging offshore alternative 20 Entire contents 2006 Forrester Research, Inc. All rights reserved.

21 Sourcing options for HR IT Maintenance and support of HR MS platforms» Available from many application outsourcing suppliers, including multi-nationals and offshore HR staff augmentation» Available from many domestic and offshore providers Software-as-a-service» e.g., Ultimate Software, Workday HRMS Integration» Various suppliers Platform-based BPO» e.g., ADP, Fidelity ERP surround BPO» e.g., Accenture, Hewitt, IBM et al 21 Entire contents 2006 Forrester Research, Inc. All rights reserved.

22 Principal suppliers of HR IT sourcing alternatives Leading ERP ISVs Major global systems integrators Leading offshore suppliers Second tier offshore players Niche suppliers/saas (e.g., Taleo, Recruitmax, Mr. Ted) 22 Entire contents 2006 Forrester Research, Inc. All rights reserved.

23 Agenda Challenges in managing HR IT HRMS platform landscape Sourcing alternatives for HR IT The emerging offshore alternative 23 Entire contents 2006 Forrester Research, Inc. All rights reserved.

24 Global Sourcing Trends 2007 Offshore outsourcing is a corporate imperative in much of North America and Western Europe Existing offshore efforts are scaling rapidly» From an FTE perspective» From a service offering perspective Infra, BPO, KPO, Consulting Companies expectations with regard to Indian vendors/offshore outsourcing have changed» There is nothing the Indian vendors can t do 24 Entire contents 2006 Forrester Research, Inc. All rights reserved.

25 What types of work are companies offshoring? Base: 133 IT decision-makers Source: Business Technographics August 2005 United States Enterprise Governance Survey 25 Entire contents 2006 Forrester Research, Inc. All rights reserved.

26 Where are companies going to increase their offshore spend? Base: 133 IT decision-makers Source: Business Technographics August 2005 United States Enterprise Governance Survey 26 Entire contents 2006 Forrester Research, Inc. All rights reserved.

27 Trends 2007: where are we today? Some companies are still only looking for pure labor arbitrage» How low will the vendors go? The smart ones are looking for value: 3 rd Generation Outsourcing» How can I improve my processes?» How can I align better with the business?» How can my vendor help me innovate? Buyers want best of breed rather than a single provider: most buyers use between two and five offshore/nearshore providers to manage demand, needs, and pricing 27 Entire contents 2006 Forrester Research, Inc. All rights reserved.

28 India is still the destination of choice Market maturity, cost, quality, experience Vendors who know how to optimize/transform and do higher value work However, India has its challenges» Rapid growth puts pressure on vendors» Labor costs, availability» Attrition» Infrastructure Roads, communications, hotels, airports, traffic 28 Entire contents 2006 Forrester Research, Inc. All rights reserved.

29 India trends 2007 Customers look for Indian alternatives, but are often disappointed by reality However, for large enterprises, a portfolio approach is required» Different geographies for different needs Skills Mexico for real-time collaboration Brazil for mainframes Languages Client location Indian vendors are becoming the best option for 21 st Century global support because they understand how to transition work around 29 Entire contents 2006 Forrester Research, Inc. All rights reserved.

30 Recommendations Despite its legacy, HR is an increasingly strategic activity for many companies and industries A variety of sourcing options are emerging Optimal mix of HR IT outsourcing options will vary, but many companies can benefit from selective or full-scope approach Despite their lack of direct impact to date, offshore suppliers are increasing their profile in HR IT sourcing scenarios 30 Entire contents 2006 Forrester Research, Inc. All rights reserved.

31 Thank you Stephanie Moore Bill Martorelli Entire contents 2006 Forrester Research, Inc. All rights reserved.

32 Selected Bibliography September 28, 2006, Tech Choices The Forrester Wave : Human Resource Management Systems, Q June 29, 2006, Market Overview ERP Applications Market Outlook Improves Ahead Of The Architecture Battle March 31, 2006, Tech Choices Oracle Versus SAP In Enterprise Applications: Let The Battle Of Architectures Begin! January 23, 2006, Market Overview HR/HCM Applications: Strategic Processes Move To The Forefront September 15, 2005, Market Overview Financial Management Applications: Expanding Beyond The Accounting Hub July 26, 2005, Quick Take Demystifying The Confusion On Project Fusion June 9, 2005, Market Overview ERP Applications The Technology And Industry Battle Heats Up June 3, 2005, Quick Take A Merger Of Equals: Lawson And Intentia 32 Entire contents 2006 Forrester Research, Inc. All rights reserved.