Bersin by Deloitte Research Shows HR Professionals Are Poised to Buy New Human Capital Management Software within the Next 18 Months

OAKLAND, Calif., May 7, 2013 /PRNewswire/ -- Bersin by Deloitte today announced new research that shows that after years of belt-tightening, most (61 percent) HR professionals surveyed indicate that they plan to replace their HR software within the next 18 months. Bersin by Deloitte, a leading research and consulting firm empowering Human Resource (HR) organizations to drive bottom-line impact, included the findings in its new research report, Managing Talent through Technology: HCM Buying Trends in 2013, available now to WhatWorks® members via BersinInsights™, the personalized and integrated member information platform.

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Summarized in a complimentary WhatWorks® brief, the research shows that one in four organizations plans on replacing a current HR information system (HRIS) in the next 12-18 months (more than half of all HR systems are more than seven years old).  Integrated talent management suites are the most sought-after new software application, with 20 percent of those surveyed indicating that they plan to replace their talent management applications with an integrated suite. Organizations are focused on two major buying needs: first, to improve user experience and second, to integrate the entire range of HR software to facilitate better analytics and effective decision-making.   

"Aging HR functionality, inability to support a global enterprise, disparate talent management applications, and tired talent acquisition tools are among the challenges facing many of today's HCM technology users," said Dr. Katherine Jones, lead analyst, Human Capital Management (HCM) Technology, Bersin by Deloitte, Deloitte Consulting LLP. "HR systems are very hard to replace because they are deeply integrated into many other systems and people practices.  Now more than ever, companies want to embrace cloud technology, support mobile users, and provide an easy-to-use experience for their employees and HR managers."

The research is based on a fall 2012 study of 308 senior HR executives representing global, multinational and national corporations and a broad range of industries. Almost two-thirds (62 percent) of respondent companies have $1 billion or more in annual revenue. The data was collected by working with Human Resource Executive magazine. The study looked at many different factors: the talent management and HRIS solutions used by the HR executives, the length of time they had been using these solutions and the changes they intended to make and had budgeted for in the year ahead.

"We see the replacement of HR and talent technology as a major trend over the coming several years," said Josh Bersin, founder of Bersin, now known as Bersin by Deloitte, and a principal with Deloitte Consulting LLP. "We are in the early stages of this technology replacement trend, which will help HR organizations propel their companies into an age of more data-driven decision-making."

The research revealed that:

• Improving the end-user experience is the biggest driver for change. Fifty-three percent of HRIS systems have been deployed for seven years or more, with almost two-thirds (63 percent) of large employers using their HRIS/HRMS for more than seven years.
• Lack of integration with other talent management or HR products and inability to derive analytics are primary considerations in new purchase decisions. Organizations want to understand workforce trends, performance drivers and predictors of future performance. Such business analytics can be achieved through integrated data from across HR and talent applications.
• Many talent areas within corporations are still managed by home-grown or custom applications. Given the need for better integration and new features, much of this software is perceived as outdated and expensive to support.
• Companies want new solution providers and are ready to switch vendors. Only one in four surveyed would consider returning to their current vendor for a new solution.
• Companies have set aside budgets for these products. Forty percent have budgeted more than $500,000 to replace their HRIS system and 40 percent have budgeted more than $750,000 for a talent management suite.

Register to join Dr. Katherine Jones for her online webinar, Buying HCM Applications: Where Users Will Likely Spend Their HR Dollars, 2:00 p.m. ET/19:00 BST on June 19, 2013

Those interested in learning more about Bersin by Deloitte or its WhatWorks® membership may email [email protected] or call (510) 251-4400. 

About Bersin by Deloitte

Bersin by Deloitte delivers research-based people strategies designed to help leaders and their organizations in their efforts to deliver exceptional business performance. Our WhatWorks® membership gives Fortune 1000 and Global 2000 HR professionals the information and tools they need to design and implement leading practice solutions, benchmark against others, develop their staff, and select and implement systems. A piece of Bersin by Deloitte research is downloaded on average approximately every minute during the business day. More than 5,000 organizations worldwide use our research and consulting to guide their HR, talent and learning strategies. For more information, please visit http://www.deloitte.com/bersin or http://www.bersin.com.

As used in this document, "Deloitte" means Deloitte Consulting LLP, a subsidiary of Deloitte LLP. Please see http://www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.

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