Reading time ( words)
“People dimension” gains prominence as a critical factor for achieving business success in Australia driving modernization of human capital management (HCM) systems.
The HCM market in Australia recorded a 5.2% of YoY growth, reaching US$129M in 2016 and set to maintain its growth trajectory in 2017 and beyond. Traditionally, HCM has been considered as a cost center and as a general record keeping system; however, rapidly evolving market landscape, war for talent and digital skills shortage, as well as evolving customer and employee expectations in Australia, is forcing organizations of all sizes to start embracing modern HCM practices and intelligent systems to be able to succeed in the digital transformation (DX) economy.
The “people dimension” has witnessed an increased attention and importance within the Australian market and is considered as the most critical component for achieving business success. This has been supported by results from IDC's 2017 Asia/Pacific Software study, which revealed that employee productivity and profitability is the most critical business priority for organizations across Australia in the next 18 months, while focus on employee satisfaction and experience is the number one initiative Australian organizations endeavor to undertake in order to improve customer experience.
“Employees are equally, if not more important than customers; employee engagement and productivity contributes to the company’s success and helps to significantly increase the overall customer experience,” says Anastasia Antonova, Market Analyst at IDC.
Today's multi-generational workforce has different drivers and incentives for better employee performance. Maintaining old archaic HR systems is no longer an option for organizations considering themselves as top market performers. Business leaders are being forced to undertake WorkSource DX* and modernize the way their enterprises acquire, manage, and leverage talent among different generations for achieving business success. “Every transformation and adoption of a new HCM system is unique. It is critical for all members of the organization - from C-level executives to IT and HR teams to be involved in WorkSource transformation and to provide the needed change management support, resources, and toolsets to empower employees at the individual level and optimise talent,” – Antonova continues. According to IDC's 2017 Asia/Pacific Software study, 83% of Australian businesses plan to upgrade and modernize their current ERP (Enterprise Resource Management) systems, as those existing systems are unable to support current and future business needs and are too cumbersome to maintain.
3rd platform technologies (cloud, mobility, big data and analytics, and social workflow), along with innovation accelerators (artificial intelligence (AI), cognitive computing, machine learning, etc.) will have a profound impact on HR organizations across the globe and Australia is no different. The application of disruptive technologies creates new opportunities to support and accelerate WorkSource transformation, help organizations to enhance maturity and empower employees to create business success, but also eliminate growth inhibitors - lack of suitable talent, high talent churn, managing contingent workforce, etc. Looking into 2018 and beyond, Australian businesses place big data and analytics on top of the list of the most important technologies to enhancing companies’ competitive advantage. Big data and analytics (including predictive and prescriptive analytics), data-driven insights and a robust end-to-end HR/talent management platform are making headlines across Australia, as 78% of businesses in Australia have either already deployed or planning to deploy workforce analytics solutions to increase visibility and improve employee engagement.
"The talent management function in most organizations have pondered over the idea of leveraging the quantum of data under its belt for years. Unfortunately, only a few have succeeded in utilising the tools and technologies available to build a truly refined and harmonious data-driven HCM system," says Sabharinath Bala, senior research manager at IDC.
HCM global market leaders: SAP, Oracle, Workday, Kronos, Saba Software, Cornerstone OnDemand, etc. along with local players such as Cognology, ELMO Talent, and the likes support organizations in transforming HR in to a strategic business function, by providing solutions, powered by custom reporting capabilities as well as predictive and prescriptive analytics.
"Australian firms have now started to explore the usage of data-driven intelligence and workforce analytics with an organization-wide context making the involvement of the HR team an integral part of this journey, to identify the risks and opportunities associated with these initiatives. HR teams are now inching toward being a regular and crucial fixture on the executive table," he added.
* IDC defines WorkSource DX as the evolution of the way how enterprises achieve business objectives by effective sourcing, deployment, and integration of internal resources, both full-time and part-time employees, and external resources, including contract, freelance, and partner assets.
International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly-owned subsidiary of International Data Group (IDG), the world's leading media, data and marketing services company.