What's happening with Talent and People Success solutions 2023-24?

The stories behind the Talent and People Success 9-Grid. A conversation between Jon Kennard and David Perring at Fosway.        

JK - Similarly to Cloud HR, the market shows strong growth despite economic headwinds disruption obvious disruption and volatility elsewhere. Could you explain a bit about that?

DP - Over the last 12 months in particular, costs have been put under the spotlight. And people start to look at more efficiency or effectiveness in the approaches that they use, as potentially one of the low hanging fruits from an HR point of view.

Typically, people have four, five, six platforms, the number keeps on going, depending on what sort of organization you are. And if you can consolidate them, it's not just the license costs that you're trying to contract. What you're also doing is trying to contract the management overheads of administering the contract.

So actually, consolidating makes a lot of sense. What we've not really seen is the scale of pressure for some of the best breed solutions that people have, particularly around some niche areas. If you look at things like performance management that tends to have been quite resilient. If you look at things like in particular employee listening, then actually, those HR systems have never really had a track record of delivering in that space.

So you end up with this situation of needing something on top of the HR system. And what we have seen in particular over the last four years is that whole area of skills. So, where you have skills solutions, and wanting to use skills to encourage talent mobility and career development and understand future skills, development and strategic resourcing. Those have bubbled up more within some of the talent solutions than we've seen from the core HR solutions. So you end up with trying people trying to consolidate the HR platforms to some extent.

There is still resilience within the best of breed solutions in some of those categories, precisely because they do things so much better, and the cost of not doing it well is too big.

?

JK - There’s going to be some tech change for a lot of companies, it seems; People looking for new solutions because certain things don't cut it anymore - top of the list appear to be employee experience and usability. Everyone's got to step their game up, right?

DP - It's a really interesting subject, because when we think about employee experience, what you have to do is try and step beyond just the UI, there's also a rethinking of process. There's a reimagining of what it is to be an employee and to work within some of these HR or business processes. So it's not enough to talk about having a consumer grade UI, you need to have an experience that actually creates value, that creates benefit that adds to the employee.?

And so I think if you look at it from the employee view out rather than the system view out, you end up with much stronger solutions. There are things that have been broken for a long time; It’s often been easier for people to get a job outside your organization than it is to get a promotion within it.

And that's not just because of the cadence of vacancies - it's the visibility. So, trying to think about how we can be more exclusive to reach out to more people within our talent pool within the organization. And when you think about experience, it's not just enough to say, oh, the screen looks better. The bigger part is, how did it make people feel? Did it help them in their lives, did it help them with their work?

?

JK - Another interesting aspect of the report, counter to perception for a lot of people is that the actual end user take-up of AI isn't that great?

DP - The latent demand for AI is going to be very significant. This month Microsoft launched their Copilot so expectations are changing exponentially. One of the reasons for the gap between those people who are active practitioners

of using AI in HR and the conversation of ‘is there enough happening in the vendor space?’, I think that there’s not necessarily a great deal happening. Still, there's a lot of talk. But what we're seeing more slowly is the percolation of AI into particular processes. Is it being used by everybody? No, but it's percolating up, and I think the waters are rising.

It's not one great big deluge is happening. Lots of different little places, and slowly we'll see the headline level of water reach our neck, if that makes sense. That's one of the interesting things. I don't think it's a lack of demand. There are some issues potentially around HR’s view of risk, and rightly so, around explainable AI; does it fit with emerging legislation? All those things are coming through. But some the technology is here, and it is starting to be used. 2024 feels a bit of make or break here, in terms of people's inflated expectations and what actually gets realised. It's difficult to see how it won't start to disrupt both the employee experience, but also the role of HR and organisations as well. I think in 2024 we're going to see the release of more and more features that just make our lives a little bit easier, and those will become cumulative to big change.

?

JK - Two more things to talk about. The first one is from the first subhead in the ‘solution trends’ section. ‘Traditional talent management is a stagnating HR strategy’. So this reflects well on Fosway’s decision to rebrand this whole 9-Grid to include the new processes of talent management, and they aren't just about that any more, are they?

DP - I think it's a very good point. I think we've moved in the last 15-20 years from thinking we need to manage talent into probably over the last four or five years thinking we need to enable talent. That's driven by the availability of skills, the desire to unleash people's discretionary efforts by creating a great place to work. All these things converge. And I think that's what’s the catalyst for this reimagining of the employee experience, reimagining how we can be more of an enabler of people, and be more proactive with people rather than just purely managing the process.?

To use an example, and I will qualify to say that just because something is stagnating doesn't necessarily mean it's not useful. It's just foundational. But in order to build on that foundation, you need to take a more proactive approach. Take succession planning; succession planning used to be the sort of thing that only really happened to the top 250 in an organisation. It was small. It was focused. But when everybody is talent, you need to be able to scale that, and traditional management processes are too intensive or too demanding not only on the individual, but the business itself.

So, trying to find easier ways to excite, motivate, energise, optimise our people has to be about everybody, because everybody's talent some extent. Moving from management to enablement isn't much more facilitative, I think, of the demands and agility that's demanded by organisations and their business leaders.

?

JK - I don't want to do the whole report because we want something for people to download. So just one more question, which I think is really important and really fascinating, which is the advent of Microsoft in the AI assistant space with Copilot. It's such a familiar brand, and it's part of so many people's working process. What do you think the impact of the potential impact of this is going to be?

DP - It's a big one. Once Microsoft start to claim the space, and the intelligence that they have around the employee experience through Copilot, for some it will be the primary touch-point for stepping into an HR process HR rather than going to an HR System .

So as these processes come closer to being meaningful in supporting work and enabling better work and enabling better relationships at work. It's difficult not too see it becoming very disruptive to HR systems.

How well that will play out? Microsoft still got a lot of work to do to fill out across some of the overall talent processes, but the intelligence that they'd be able to gather, the things they're promising to bring? It's difficult to see them not being increasingly influential.

But when we think about the surfacing of assistants like personal AI bot assistants; are we going to have 20 assistants – one working for every system? Eventually we’ll need to have one voice, and that voice also needs to have a sense of cadence so it's not always into interrupting us. You don't want the assistant tapping your shoulder every five minutes, saying, Oh, did you know there's some new process? And there's this new thing for you to do? That's too overwhelming.

So, trying to find the right pacing for individuals to optimise their engagement as well is something that these systems will have to try and manage. But, it’s difficult to not see a big provider like Microsoft owning the primary voice of the bot when it talks to you. So I think they're going to be huge but they’ve still got to get it right. And this is where competitive market specialist knowledge really matters, where specialist expertise really matters… and where playing nicely together really really matters.

?