hr-tech-survey

PwC HR Technology Survey detailed report | 1

PwC HR Technology Survey detailed report Innovating for tomorrow’s workforce

Moving HR applications to the cloud

2016


MethodologyPwC worked with Oxford Economics to survey executives from more than 650 companies about their organization’s use of HR technology as part of an ongoing annual research program.Respondents represent a range of company sizes with more than $500 million in annual revenue; a majority of respondents have more than 1,000 employees. Industries represented include, but are not limited to, Industrial Products (28%), Financial Services (19%), Healthcare (13%), Retail and Consumer (10%), and Power and Utilities (9%). These mostly international companies are headquartered in countries around the world.



Q2. What is your role in HR or your connection to HR technology at your organization?

Name, title and company.

Q1. Respondent information

Q2. What is your role in HR or your connection to HR technology at your organization?

I work in HR focused on HR technology (HRIS)

35%

21%

24%

19%

1%

I work in HR as an HR business partner

I work in HR in a Center of Excellence/support function

I work in our IT department focused on HR Technology (HRIT)

Other

Q3. What is your company’s total employee headcount?Q3. What is your company’s total employee headcount?

Morethan 50,000

Between25,001 and

50,000

Between10,001 and

25,000

Between5,001 and

10,000

Between1,001 and

5,000

Under 1,000

23%

38%

19%

13%

3% 4%


Q4. What is your organization’s annual revenue in USD for the most recently completed fiscal year? Q4. What is your organization’s annual revenue in USD for the most recently completed fiscal year?

$500 million–$999 million

42%

43%

15%

$1 billion–$4.9 billion

$5 billion and over

Q5. Do you have employees based in more than one country?Q5. Do you have employees based in more than one country?

Yes

70%

30%

No

Q6. In what region is your organization headquartered?Q6. In what region is your organization headquartered?

North America

37%

20%

21%

22%

Latin America

Asia Pacific

EMEA


Q7. Please select your industryQ7. Please select your industry

Other

Entertainment and media

Cable and wireless/communications

Technology

Power and utilities

Retail and consumer

Healthcare

Financial services

Industrial products 28%

19%

13%

10%

9%

6%

6%

5%

4%



Q9. Select the various ways in which you or your employees/managers currently use mobile technology applications for HR processes. Select all that apply.

Not applicable—we do not use mobiletechnology for anything HR-related

Most transactions that I perform on my desktopcan be performed on my mobile device

Recognition programs

Performance management

Viewing HR reports/analytics

Chage personal/job data

Training enrollment/delivery

Time and/or expense entry

Company directory look-ups

Viewing infromation about myself or my team

Work-flow approvals (e.g., hiring approval,time report approvals, etc.)

40%

36%

32%

29%

26%

24%

21%

18%

10%

4%

30%

The use of mobile devices for managing HR processes is increasing rapidly. Two years ago, only 30% of respondents used mobile for HR. That number has risen to 70% this year.

Q8. Select the various ways in which you or your employees/managers currently use mobile technology applications for HR processes. Select all that apply.

When we compared the overall survey answers against the subset of those respondents that have their core HR in the cloud (via SaaS), we found that organizations with SaaS core HR are 23% more likely to leverage mobile technologies.


Q10. In your opinion, what transactions or functionality would be most beneficial to deploy on mobile to boost the productivity of managers across your organization? Select up to 5.

Initiateemployee

job changes

Initiateemployee

compensationchanges

Initiate jobrequisitionsand approvecandidates

for hire

Be able tosee predictive

analyticsregarding teamengagement/

attrition

Be able to seecorrelations

betweenperfomance

andcompensationfor my team

Be able tosee a talentdashboardthat showskey gaps

Reviewand approve

employee time/absences/expenses

Manageindividual

performance

59%

54%52%

45% 44% 44%

31%

16%

Q9. In your opinion, what transactions or functionality would be most beneficial to deploy on mobile to boost the productivity of managers across your organization? Select up to 5.

Companies are looking to deploy mobile capabilities to boost employee productivity. HR in the cloud is serving as the enabler of that strategy given the enhanced user interface and shorter path to deployment.

52% Be able to see a talent dashboard that shows key gaps

59% would like to manage individual performance

Q9. cont’d

54% would like to use mobile to review and approve employee time/absences/expenses

Viewing HR reports/analytics

Work-flow approvals

Performance management 18%

40%

21%

As you can tell from the prior to charts, there are still large gaps between what has been deployed (red bar on the left) and what is desired (percentage on the right).


Q10. When you think about the number of different software vendors that are included in your current HR technology portfolio, how do you see that changing in the future?Q11. When you think about the number of different software vendors that are included in your current HR technology portfolio, how do you see that changing in the future?

We plan to use even more software vendors (e.g., we anticipate needing to integrate between even more HR software vendors)

14%

36%40%

10%

No change, we plan to have about the samenumber of software vendors

We plan on using fewer software vendors (e.g., consolidating our portfolio)

Unknown

We continue to see vendor consolidation in the HR technology market. These numbers are consistent with last year, where 39% planned to use fewer software vendors to deliver HR services.



Q11. If you are planning to consolidate the number of software vendors in your HR technology portfolio, what are the motivating factors? Select all that apply. Base= 261 respondents

Q12. If you are planning to consolidate the number of software vendors in your HR technology portfolio, what are the motivating factors? Select all that apply. Base = 261 respondents

Drive towardconsistent

user experience

Ability tonegotiate better

volume discountson the license orsubscription fee

Greaterinteroperabilityand integration

across the solutionsoffered by thesame vendor

Receive bettersupport from

the vendor givenincreased footprint

Need lessvariety of skills

internally tosupport the HR

technology stack

Easier tomanage

relationshipswith one vendor

vs. multiple

61% 60%57%

47%

41%39%

Companies are looking to minimize the complexity of vendor management, limit the variety of skills required internally to support and are looking to receive better support through HRIS vendor consolidation. Surprisingly, driving for a consistent user experience was not in the top five. This may imply that, as long as the UI is a good experience, it does not need to be the exact same experience.


Q12. Over the next 12–24 months, what are your top priorities for implementation or upgrade?

Q13. Over the next 12–24 months, what are your top priorities for implementation or upgrade?

2013 2014 2015

Mobile

Manager self service (MS)

Employee self service (ESS)

Learning management

Benefits

HR help desk

Employee portal

Absence management

HR analytics

Onboarding

Incentive compensation

Compensation

Time reporting

Recruiting

Payroll

Talent review and succession planning


Core HR 23%27%

22%9%

7%8%

4%4%

8%4%

5%7%

24%19%

9%7%

8%7%

3%1%

7%1%

2%6%

5%8%

5%

5%5%

1%1%

4%

1%4%

2%3%

4%2%2%

2%2%

4%2%

4%5%

1%

1%

Core HR and Talent related processes seems to be top priority for most of the companies which has been a consistent theme for the last 3 years. Addressing the Core HRMS solution continues to dominate the list of priorities as organizations address this foundational process area—mostly migrating it to the cloud.


Q13. Do you have any HR-related processes in the cloud using Software as a Service (SaaS)?

Q14. Do you have any HR-related processes in the cloud using Software as a Service (SaaS)?

Yes

68%

32%

No

Based on survey results, two out of three companies have at least one process in the cloud. Two years ago, the number was 55%.

Q14. In general, what were your primary motivators for deploying cloud Software as a Service (SaaS) for your HR-related processes? Select all that apply.

Q15. In general, what were your primary motivators for deploying cloud Software as a Service (SaaS) for your HR-related processes? Select all that apply.

A companymandateto movethe cloud

Had a costly/complex

environmentand needed acatalyst event

for change

Wanted abilityto access

processes viamobile devices

Did not have theinfrastructure tohost/manage the

software ourselves

Ability totake advantage

of softwareinnovations/

quickerrelease cycles

Lower cotof ownership

Wanted lessdependence on IT

64% 63%

45%43%

33%29%

3%

Companies see cloud as a way to lower their dependence on an IT function that already has a full plate. They also see it as a way to lower their cost of ownership. The third motivator globally (at 45%), and the first priority in the US, was to stay ahead of internal customer demand by taking advantage of more frequent software innovations.


Q15. When considering the HR processes that your organization has moved to the cloud, what were your biggest challenges during the implementation? Select all that apply.

Q16. How satisfied are you with your cloud product(s’) ability (in aggregate) to meet your business needs?

Q16. When considering the HR processes that your organization has moved to the cloud, what were your biggest challenges during the implementation? Select all that apply.

55%

55%

52%

42%

28%

25%

10%

4%No challenges

Lack of executive sponsorship or clear vision

Lack of skilled/available resourcesin the market who know the product

Lack of internal resources to assistwith the project

Not fully prepared for the processtransformation required

Product defects/bugs

Our organization’s readiness to give upcustomizations and embrace the SaaS mindset

The product didn’t have the features or didn’tperform as we were led to believe in the

sales process

Q17. How satisfied are you with your cloud products’ ability (in aggregate) to meet your business needs?

Very satisfied

20%

42%

26%

10%

2%

Somewhat satisfied

Neither satisfied nor dissatisfied

Somewhat unsatisfied

Very unsatisfied

More than half of the respondents say their ability to give up customizations and product functionality were the top challenges. Investing time upfront in product evaluation and project planning (e.g., change readiness) will minimize surprises during the implementation.

To a large extent, customers are satisfied with the cloud technology and we expect to see the satisfaction level continue to grow as products further mature and new features are released. Understanding the vendor’s product roadmap is important when selecting the solution.


Q18. On average, for the HR processes you have in the cloud, what percent (0%–100%) of your functional requirements have been met through the software product(s) as delivered?

20%

30%

40%

50%

60%

70%

80%

90%

100% 1%

11%

22%

22%

21%

13%

6%

1%

1%

Q17. On average, for the HR processes you have in the cloud, what percent (0%–100%) of your functional requirements have been met through the software product(s) as delivered?

On average, only 67% of business requirements are met out of the box. For the remaining 32%, creative configuration and/or policy/process change is required.

Obviously, the sophistication and amount of special exceptions associated with an organization’s requirements will drive these initial fit scores. However, it’s important to ensure all critical (or inflexible) requirements are met rather than focus on every single requirement. Critical requirements need to be evaluated against the product before embarking on a full scale implementation or signing up for the software subscription. Also, don’t be shy about working with your software vendor on future release enhancement requests that may satisfy key needs. Lastly, Platform as a Service (“PaaS”) can be an answer for unique requirements as well if current processes cannot be changed.


Q18. How satisfied are you with the support offered by your cloud software vendor(s)?

Q19. How satisfied are you with the support offered by your cloud software vendor(s)?

Very satisfied

14%

45%

25%

13%

1%1%

Somewhat satisfied


Somewhat unsatisfied

Very unsatisfied

Don’t know

Last year, 20% of respondents said they were “very satisfied.” That number is down 6% this year to 14%.

Q19. How would you describe your cloud vendor’s version update/release process? Rate your agreement on a scale of 1–5. “Agree” and “Strongly agree” responses

Q20. How would you describe your cloud vendor’s version update/release process? Rate your agreement on a scale of 1–5. “Agree” and “Strongly agree” responses

Vendor communicates upcoming new features and functionality

ahead of time.

47%

New features are easy to implement,

do not require additional staff to implement.

38%

Typically, the new features break existing functionality/processes.

36%

The frequency with which new

features are released is adequate.

33%

Moving to the cloud is an adjustment, especially for organizations that have grown accustomed to internal HRIS / HRIT departments that can focus on any or every unique request that management deems critical. With cloud, you are now in a shared community with many, many others. And while there are benefits to consuming HR technology in this manner, “having it your way, everyday” is not one of them.

Nearly half of the respondents agree that vendor communication of new releases is adequate. However, sometimes, the existing functionality does get impacted by changes. Hence, it’s important that customers establish a repeatable testing/validation process to ensure that the new features do not break existing processes as was the case with over one third of the survey respondents.


Q20. Is the patching maintenance schedule for your cloud solutions disruptive to your operations?

Q21. Is the patching maintenance schedule for your cloud solutions disruptive to your operations?

Very disruptive

9%

38%

46%

7%

Somewhat disruptive

Not disruptive

Don’t know


Moving any new technology or release into production is going to require some degree of extra effort and, thus, can be disruptive. However, most—46%—felt the patching and maintenance schedule was not a problem. Still, it is important to understand your vendor’s maintenance schedule early on and to plan your business and maintenance operations accordingly so that you avoid disruptions.


Q22. If you are considering moving your core HR/payroll system to the cloud but have not done so yet, what concerns do you have? Select all that apply.

38%36%

32%

29% 28%

22%

28%

8%

2%

Ability to integrate with

other on-premise or third-party

solutions

Concerns over the security

of critical HR data stored in the cloud

Not ready for the level of

change management and process

transformation the product may force

Ability of the product to flex as our business

needs change

Ability to meet critical business

requirements

Budgetary concerns

Not applicable—core HR and/or payroll solutions

are already in the cloud

Not applicable—we are not

contemplating a move to the cloud for any HR processes

Not applicable—we do

not have any concerns

Q21. If you are considering moving your core HR/payroll system to the cloud but have not done so yet, what concerns do you have? Select all that apply.

Ability to integrate on-premise solutions and security are the top concerns that are slowing the move to cloud, particularly, for some of the smaller organization with limited IT resources. The level of process change required is another large concern, keeping some organizations on the sidelines.


Q22. If you have no intentions of moving your core HR/payroll system to the cloud, what would change your mind? Select all that apply.

Security and maturity of products are the top two justifications cited by the 53 respondents who had no intentions of moving their HR technology to the cloud. The ability to extend the functionality to meet unique requirements was another big concern. We expect these fears to be eased as cloud vendors continue to make heavy investments in their solutions, data centers and PaaS offerings.

Q23. If you have no intentions of moving your core HR/payroll system to the cloud, what would change your mind? Select all that apply.

Other

Not applicable—other reason(s)

Not applicable—we are already in the cloudfor core HR and/or payroll

Nothing would change our mind

If the cloud solutions become more affordable

If our current vendor stopped enhancing the product

If the solutions we are currently using no longer supportedour business needs

If our current vendor stopped supporting our current solution

If cloud solutions provided a better ability to extend(or customize) the product to meet unique customer needs

If the cloud solution became more mature interms of the functionality offered

If our concerns about data security in the cloud were alleviated 43%

43%

40%

28%

26%

26%

17%

9%

9%

4%

2%


Q23. How is your solution currently deployed?Q24. How is your solution currently deployed?

On premise SaaS Third-party supplier N/A

61% 15% 10% 14%

39% 24%14%

52%

43%

31%

33%

45%

32%

34%

32%

51%

19%

19% 13%

13% 21%

10%40%

22% 21%

24%

13%

9%

22%

21%

24%

8%

44% 3% 1

24%

30%

35%

35%

5%

26%

20%

34%

15%Time reporting


Recruiting


Payroll

Onboarding

Learning management

HR analytics

Core HR

Compensation

Benefits

We continue to see erosion of the on-premise population in favor of more cloud solution deployments.



Q24. What are your plans in 1–3 years?Q25. What are your plans in 1–3 years?

50% 6%

30% 21%

30%

32%

32%

32%

1

1

1

1

1

12%

18% 28%

33% 28%

22%

20%

3%5%

30%

27%

22% 22%

9%

40% 1

1

2

2

2

2

1

1

1

2

2

3%

3%

3%

4%

46%

66%

51%

50%

35%

68%

39%

48%

52%

55%

No change Bring on premise Move to SaaS Outsource Don’t know

Time reporting


Recruiting


Payroll

Onboarding

Learning management

HR analytics

Core HR

Compensation

Benefits

1

Q25. Please choose your current product/provider.

Cor

e H

R

Ben

efits

Tim

e R

epor

ting

Pay

roll

Rec

ruiti

ng

Onb

oard

ing

Com

pen

satio

n

Per

form

ance

M

anag

emen

t

Tale

nt R

evie

w

& S

ucce

ssio

n P

lann

ing

Lear

ning

M

anag

emen

t

HR

Ana

lytic

s

Oracle: PeopleSoft 141 95 59 85 28 29 56 39 24 21 34

No vendor, internally developed solution

7 24 47 21 34 62 41 42 45 47 45

Oracle: e-Business Suite (EBS) 55 52 30 44 32 19 44 35 26 28 22

Oracle: cloud 8 2 5 6 119 67 43 53 35 25 23

ADP 41 41 35 159 22 12 25 7 6 3 5

Manual, no technology used 2 16 27 11 46 44 30 44 41 43 49

SAP: SuccessFactors 25 15 15 12 24 16 45 70 51 28 16

SAP: R/3 or ECC 61 44 30 30 15 13 22 22 21 26 29

Workday 39 27 29 29 5 12 33 25 18 8 26

Kronos 2 5 118 10 15 7 3 5 6 5 2

Highest Second highest

Top ten most commonly used vendors are shown below


Q26. What release are you on?

The data displayed below is for Core HRMS, on-premise applications (since SaaS vendors generally require organizations to stay on the current release or no greater than one release behind). The data would indicate that over the last few years, while cloud HRMS has been growing, the organizations that have chosen to wait have gotten more current on their vendor’s latest release—likely to buy time (especially for those needing payroll tax updates). Others (around 30%) have likely chosen not to invest more in their HRMS until they are ready for cloud or cloud is ready for them.

24% 35% 10% 32%

4% 53% 13% 30%

Current release

1 releasebehind

2 releasesbehind

3+ releasesbehind

Current release

1 releasebehind

2 releasesbehind

3+ releasesbehind

2015

2013


Q27. How satisfied are you with your current solution?Q29. How satisfied are you with your current solution?

13%

53%

23%

8%

2%1%

Very dissatisfied Somewhat dissatisfied Neither satisfied nor dissatisfied

Somewhat satisfied Very satisfied Don’t know

Core HR Benefits

7%

42%34%

11%

3%3%

Time reporting

25%

21%

14%

20%

15%

5%

Q29. How satisfied are you with your current solution? cont’d

21%

18%27%

20%

10%

4%

Payroll Recruiting

21%

19%30%

18%

3%

Onboarding

21%

21%33%

18%

2%

9% 6%




Q27. How satisfied are you with your current solution? cont’dQ29. How satisfied are you with your current solution? cont’d

24%

22%

30%

16%7%

2%

Compensation Performance management

22%

27%

31%

14%

1%


18%

27%36%

13%

2%

5% 4%



Q29. How satisfied are you with your current solution? cont’d

Very dissatisfied21%

30%

31%

12%4%

3%

Somewhat dissatisfied


Somewhat satisfied

Very satisfied

Don´t know

Learning management HR analytics

14%

48%

29%

5%

2%2%


It took longer and/or cost more than we expected

Q30. Describe your implementation.

It was shorter or cheaper than we expected

20%

24%

17%

20%

18%

20%

21%

22%

22%

23%

11%

11%

18%

40%

22%

28%

21%

19%

19%

20%

19%

25% HR analytics

Learning management

Talent review andsuccession planning

Performancemanagement

Compensation

Onboarding

Recruiting

Payroll

Time reporting

Benefits

Core HR

Q28. Describe your implementation.

Q30. Describe your implementation. cont’d

Core HR Benefits

11%

62%

20%

7%

18%

45%

24%

13%

Don´t knowIt was shorter or cheaperthan we expected

It was about

what we expected

It took longer

and/or cost more than

we expected


It was about

what we expected

It took longer


we expected



Q.30 Describe your implementation. cont’d

Time reporting Payroll Recruiting

40%

29%

17%15%

22%

39%

20% 20%

28%

43%

18%

12%


It was about

what we expected

It took longer


we expected


It was about

what we expected

It took longer


we expected


It was about

what we expected

It took longer


we expected


Onboarding Compensation Performance management

21%

44%

20%

16%

19%

48%

21%

13%

19%

48%

22%

11%


It was about

what we expected

It took longer


we expected


It was about

what we expected

It took longer


we expected


It was about

what we expected

It took longer


we expected





Learning management HR analytics

20%

50%

22%

9%

19%

46%

23%

12%

25%

55%

11%8%


It was about

what we expected

It took longer


we expected


It was about

what we expected

It took longer


we expected


It was about

what we expected

It took longer


we expected

Q29. When you consider HR/People Analytics in your organization, what is your primary focus for the next 12 months?Q31. When you consider HR/People Analytics in your organization, what is your primary focus for the next 12 months?

None of the above, not focusedon this over the next 12 months

All of the above

Data governance(e.g., data dictionary, data harmonization)

Transactional reporting(e.g., employee lists such as anniversaries)

Advanced analytics(e.g., data mining, predective analytics)

Foundational analytics (e.g., headcount reporting,turnover, hiring metrics, KPIs for a dashboard) 39%

38%

24%

22%

29%

11%

The largest percentage of respondents are still focused on the “basics” when it comes to HR/People Analytics.


Q30. Do you have a strategy and roadmap in place to drive your HR/People Analytics agenda (i.e., what is needed by whom and why, how it will be delivered and when)?

55%

6%

39%

45%

3%

52%

Yes

No

Not sure

Q32. Do you have a strategy and roadmap in place to drive your HR/People Analytics agenda (i.e., what is needed by whom and why, how it will be delivered and when)?

Q33. Do you have a dedicated HR/People Analytics organization/Center of Excellence supporting and sustaining your data, reporting,and analytics needs?

Q34.Does your current Human Resource Information System (HRIS) platform provide for your end-to-end reporting and analytics needs?

Yes

49%

15%

36%

No

Not sure

Q32. Does your current Human Resource Information System (HRIS) platform provide for your end-to-end reporting and analytics needs?

Q31. Do you have a dedicated HR/People Analytics organization/Center of Excellence supporting and sustaining your data, reporting, and analytics needs?


Q33. What are some of the common challenges you face with your HR analytics efforts? Select all that apply.

OtherWe have the capabilityto utilize our HRIS

for more sophisticated reporting and analytics

but lack the internal resources to make

that happen

The HRIS platform meets our transactional

reporting needs but not much beyond

simple queries

Data quality is still an issue, leading to

inconsistent reporting and analytics

Lack of consolidatedreporting (i.e., need to report from your HRISplatform combined with data from other

HR systems)

Q35. What are some of the common challenges you face with your HR analytics efforts? Select all that apply

70%

63%

46%

23%

4%

Q34. Do you have a need for external HR analytics benchmarks for your industry or peer group?Q36. Do you have a need for external HR analytics benchmarks for your industry or peer group?

43% 41% 16%

Yes No Not sure

Benchmark Report Disclaimer:PricewaterhouseCoopers has exercised reasonable care in the collecting, processing, and reporting of this information but has not independently verified, validated, or audited the data to verify the accuracy or completeness of the information. PricewaterhouseCoopers gives no express or implied warranties, including but not limited to any warranties of merchantability or fitness for a particular purpose or use and shall not be liable to any entity or person using this document, or have any liability with respect to this document. This report is for general purposes only, and is not a substitute for consultation with professional advisors.

© 2016 PwC. All rights reserved. PwC refers to the US member firm or one of its subsidiaries or affiliates, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. 104877-2016

Contacts

For more on PwC’s annual HR Technology survey, please contact:

Dan Staley Principal PwC Office: 678 419 1802 Mobile: 770 331 7417 [email protected]

Murali Gandi Director PwC Office: 314 206 8781 Mobile: 847 226 2364 [email protected]

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