RS Talent Acquisition Systems 2010 Executive Summary Bersin 21pgs

Talent Acquisition Systems 2010

Executive Summary

© BERSIN & ASSOCIATES RESEARCH REPORT | V.1.0

Madeline Laurano,

Principal Analyst

September 2009

Talent Acquisition Systems 2010: Executive Summary �

Bersin & Associates © September 2009 • Not for Distribution • Licensed Material

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TABLE OF CONTENTS

Introduction 4

Summary of Key Findings 5

1. Today’s Talent Acquisition Systems Providers Are Responding to the Market by Offering More Innovation in Advanced Features and Strategic Partnerships. 5

2. Although Many of Today’s Solution Providers Are Offering Full Talent Management Suites, Organizations Are Slow to Embrace One Platform for Both Recruitment and Employee Development. 6

3. Organizations Need to Consider Integrating Their Talent Acquisition Systems with Their Human Resource Management System (HRMS) and Third-Party Recruitment Providers during the Implementation Stages. 6

4. Customers Are Demanding More Web 2.0 Capabilities and Social Networking Integration from Their Talent Acquisition Providers. 8

5. Global Support Needs to Encompass More Than Multilingual Configuration Including Compliance to Local Regulations, Currency and Time Zone Support. 9

6. Market Churn Is a Constant in Today’s Talent Acquisition Marketplace. 10

7. Solution Providers Are Experiencing an Uptick in Customers from High-Volume Industries, Such as Retail and Hospitality. 10

8. Contact Management Needs to Be a Priority When Considering Talent Acquisition. 11

9. Organizations Need to Consider the Integration of Talent Acquisition and Performance Management Solutions. 12

Conclusion 1�

Appendix I: Vendor Profile – SuccessFactors 14

About Us �1

About This Research �1

Talent Acquisition Systems 2010: Executive Summary 4


IntroductionThe talent acquisition technology market is one of dramatic change and innovation. Both during strong and weak economies, investment in talent acquisition systems remains a priority for best-practice companies looking to gain a competitive advantage and secure a solid talent pipeline1 of both active and passive candidates. Unlike other areas of talent management that are not continuously driven by external pressures, the state of talent acquisition systems continues to evolve.

Organizations at both the enterprise and midmarket level recognize both the short- and long-term value in this investment. Yet, with recent consolidations and a new crop of providers entering today’s talent acquisition market, making the right decision around recruitment technology can feel daunting. Organizations are currently in a precarious position to not only demand more from their existing providers, but also to take advantage of the new innovations in areas, such as social networking, video tools, job-matching and search engine optimization.

The purpose of this research is to give readers insights into the distinctions and overall market trends of the leading talent acquisition systems providers available today. In our research, we explore:

• Various market trends during both strong and weak economies;

• Market growth and potential for talent acquisition systems providers;

• Recommendations for purchasing a talent acquisition system;

• The best practices for evaluating and selecting a talent acquisition solution provider;

• Key concerns during product implementation;

• Global support and configuration;

• Customer satisfaction; and,

• Key partnerships with talent acquisition providers.

1 “Talent pipeline” refers to an organization’s ongoing need to have a pool of talent

that is readily available to fill positions at all levels of management (as well as other key

positions) as the company grows. At each level, different competencies, knowledge and

experiences are required, and (to keep the pipeline filled) the organization must have

programs designed to develop appropriate skills sets.



Summary of Key Findings

1. Today’s Talent Acquisition Systems Providers Are Responding to the Market by Offering More Innovation in Advanced Features and Strategic Partnerships.

Long viewed as a commoditized market, talent acquisition has experienced a breakthrough in innovation over the past year. Solution providers are not only facing competition from a highly saturated market – but also from a new cast of players aiming to offer new tools and services that replace the résumé and strengthen employer branding. Organizations are taking advantage of today’s down economy by reassessing their current talent acquisition processes and investments in technology. Any organization looking to make leaner and smarter decisions around identifying talent needs to reassess its current system and determine what opportunities are available. Traditional solution providers are responding by offering more Web 2.0� capabilities (such as RSS feeds and integration with social networking sites). Other providers are forming partnerships with these new providers (such as Jobs2web, SimplyHired and Jobfox) to offer their customers search engine optimization, social networking capabilities and a standard job application. Organizations looking for new strategies to recruit talent now have options.

2 “Web 2.0” refers to a perceived second generation of web-based communities and

hosted services (such as social-networking sites, wikis, folksonomies, weblogs / blogs,

social bookmarking, podcasts, RSS feeds, social software, web application programming

interfaces / APIs, and online web services), which aim to facilitate creativity, collaboration

and sharing between users. Although the term suggests a new version of the World

Wide Web, it does not refer to an update to any technical specifications, but to changes

in the ways software developers and end-users use the web. Source: http://en.wikipedia.

org/wiki/Web_2.0#Defining_.22Web_2.0.22.

http://en.wikipedia.org/wiki/Web_2.0#Defining_.22Web_2.0.22

http://en.wikipedia.org/wiki/Web_2.0#Defining_.22Web_2.0.22



�. Although Many of Today’s Solution Providers Are Offering Full Talent Management Suites, Organizations Are Slow to Embrace One Platform for Both Recruitment and Employee Development.

During both qualitative and quantitative research, it became clear that, while organizations in other areas of talent management (such as performance management and succession planning) look to one platform to support these areas, talent acquisition still remains isolated. One reason is that the buyers are a different audience from other areas of talent management. Secondly, many organizations make their decisions about talent acquisition without considering a long-term approach to retaining employees. Talent acquisition departments are looking to find quality candidates in an effective and efficient manner; they are not looking at employee development and retention. Sixty-eight percent of respondents to our survey only use their solution providers for recruiting. The talent acquisition solution providers included in this report are financially stable and have strong customer satisfaction rankings, whether offering a best-of-breed recruitment solution or full talent management.

�. Organizations Need to Consider Integrating Their Talent Acquisition Systems with Their Human Resource Management System (HRMS) and Third-Party Recruitment Providers during the Implementation Stages.

Integration is a critical component of any talent acquisition system and, surprisingly, one aspect that is often overlooked during implementation. More often than not, organizations feel pressure to select and implement a system in a short period of time. In doing so, they fail to think about any long-term implications, such as integration with their existing HRMSs and third-party recruitment providers. Several years ago, the majority of organizations were not considering the process of integration when



selecting and implementing talent acquisition systems. They were making decisions without thinking about a more strategic view of talent. Today, organizations seem to be more mature in their views of identifying, developing and retaining talent, but still are not making integration an initial priority. This is evident in the number of “N / A” responses with satisfaction in integration (see Figure 1). You can assume that these organizations have not integrated their talent acquisition systems with their HRMSs or third-party recruitment providers. We recommend that organizations consider their current HRMSs, talent management providers, third-party recruiting providers and social media when implementing their talent acquisition systems.

13%

17%

24%

11%

21%

15%

29%

13%

10%

13%

13%

10%

5%

4%

9%

7%

5%

0%

0%

0%

46%

51%

25%

59%

0% 10% 20% 30% 40% 50% 60% 70%

Background Checking

Assessments

HRMS

Social Networking

N / A Very Unsatisfied Unsatisfied Neutral Satisfied Very Satisfied

Figure 1: Satisfaction with Talent Acquisition Systems Integration

Source: Bersin & Associates, 2009.



4. Customers Are Demanding More Web �.0 Capabilities and Social Networking Integration from Their Talent Acquisition Providers.

Social networking has exploded in talent acquisition over the past few years. While most solution providers avoided this topic in the past, they are beginning to recognize a strong demand from their customers to provide more support for features that enable connectivity, such as video, social networking and RSS feeds. According to our research, 41 percent of companies indicated that social networking is a “must-have” when considering advanced features they would like included in their talent acquisition systems (see Figure 2). For many organizations, integration with social networking is even more critical than these advanced features. Not surprisingly, as many providers have been slow to respond to this demand, most organizations are not satisfied with the current level of integration with social media (see Figure 3).

Copyright © 2009 Bersin & Associates. All rights reserved. Page 3

Must Have41%

Nice To Have24%

Not a Concern1%

Solution Provider Already Supports This

17%

Don't Know17%

Figure 2: Demand for Web 2.0 Capabilities




5. Global Support Needs to Encompass More Than Multilingual Configuration Including Compliance to Local Regulations, Currency and Time Zone Support.

Evaluating, selecting and implementing a global talent acquisition system requires a deep understanding of local needs and regulations. Many of the providers included in this report are able to support global multilingual configurations for both the recruiter and candidate interfaces. The challenge is that not every provider is able to provider support in other areas of a global system, such as local regulations, currency and time-zone support. We recommend that organizations consider and plan for various scenarios that may occur during global implementation, and involve a representative from each region to participate in the selection process. Organizations should conduct customer reference calls with other global organizations facing similar challenges.


8%

13%

54%

15%

10%

0% 10% 20% 30% 40% 50% 60%

Very Satisfied

Satisfied

Neutral

Unsatisfied

Very Unsatisfied

Figure 3: Satisfaction with Social Networking Integration




�. Market Churn Is a Constant in Today’s Talent Acquisition Marketplace.

This reality makes the task of selecting a talent acquisition system more difficult than ever. During market consolidations, many customers lose the level of customer support they had received from their providers. Due to this market consolidation and customer dissatisfaction, organizations have been looking for replacement solutions for their talent acquisition systems. Many questions are often left unanswered and organizations begin to look at other options. According to our survey results, 40 percent of organizations have invested in two or more talent acquisition systems in the past few years. Through our interviews, we learned that many of the customer references provided by solution providers are actually frustrated with their talent acquisition systems and are looking at other options. When considering a talent acquisition system, buyers need to take into account financial viability of the solution providers, as well as the impact of market consolidation.

�. Solution Providers Are Experiencing an Uptick in Customers from High-Volume Industries, Such as Retail and Hospitality.

Historically, high-volume industries (such as retail and hospitality) have been slow to adopt technology solutions. One reason is that many organizations are not familiar with the differences involved with recruiting hourly versus salaried workers. Solution providers have recognized an opportunity for growth in these industries (some providers stated that 40 percent of these organizations still need a talent acquisition system) and have responded by offering separate modules for hourly workers, interview management tools, and tax and screening procedures. Organizations in retail and hospitality now have options when selecting a talent acquisition system.



�. Contact Management Needs to Be a Priority When Considering Talent Acquisition.

Several years ago, contact management was dubbed an immature area of talent acquisition for solution providers and customers. In today’s shaky global economy, things have changed. Contact management needs to be a priority for any organization looking to build a strong talent pipeline, and establish long-term relationships with potential applicants, key stakeholders and former employees. Adopting a strategy that includes contact management will help organizations build an integrated talent acquisition strategy by focusing on connectivity, accountability and interactivity. We found that 41 percent of organizations believe that contact management is a must-have. Even more astounding is that 55 percent of organizations are using their talent acquisition providers for contact management. These organizations are asking more from their providers – and, in return, solution providers are adding this functionality or partnering with companies, such as AIRS to provide this functionality.


Must Have44%

Nice To Have18%

Solution Provider Already Supports

14%

Don't Know24%

Figure 4: Organizations That Request Contact Management


Talent Acquisition Systems 2010: Executive Summary 1�


�. Organizations Need to Consider the Integration of Talent Acquisition and Performance Management Solutions.

In our Talent Management Suites industry study�, we identified performance management functionality as the “backbone” of the integrated solution. In fact, every talent management suite available on the market today supports core performance management feature sets, as well as many of the advanced feature sets (including job and talent profile management, and talent analytics).

3 For more information, Talent Management Systems 2010: Market Realities,

Implementation Experiences and Solution Provider Profiles, Bersin & Associates /

Leighanne Levensaler and Madeline Laurano, September 2009. Available to research

members at www.bersin.com/library or for purchase at www.bersin.com/tmsuites.


Figure 5: EPM Integration with Other Talent Management Processes

Integrated Approach Information Shared

Performance and Learning Management

• Competencies• Learninganddevelopmentactivities–tomeetgoals,andclose

performanceandcompetencygaps• Learningexperiencesasdevelopmentgoals• Progressandcompletioninformationonthedevelopmentplan.

Performance and Recruitment Management

• Performanceresults• Initialdevelopmentgapsfrompre-hireassessmentandinterview

results• Jobprofile(e.g.,requiredexperience,skillssets,abilitiesand

behaviors)

Performance and Workforce Planning (Talent Planning)

• Criticaljob,roleandskillrequirementsforbusinessplanandfutureneeds

• Gapsincriticalskills• Jobprofile(e.g.,requiredexperience,skillssets,abilitiesand

behaviors)

http://www.bersin.com/library

http://www.bersin.com/tmsuites



ConclusionThe leading talent acquisition systems will continue to develop beyond core functionality (e.g., applicant tracking and candidate requisition) into areas, such as contact management, onboarding, employer branding and performance management. Understanding your organization’s needs and considering your company’s talent management strategy along those lines will help locate software automation solutions that support those objectives. When considering product differentiators, consider from what position of strength this application developed. Get to know the other customers – you will be able to be a resource for each other. We hope that our report, Talent Acquisition Systems 2010: Facts, Practical Analysis, Trends and Provider Profiles4, serves as an educational tool for project teams and their key stakeholders to understand the current state of the market – and can also serve as a framework for solution selection.

4 For more information, Talent Acquisition Systems 2010: Facts, Practical Analysis, Trends

and Provider Profiles, Bersin & Associates / Madeline Laurano, September 2009. Available to

research members at www.bersin.com/library or for purchase at www.bersin.com/TAS.

http://www.bersin.com/library

http://www.bersin.com/TAS



SuccessFactors, Inc.

Company Background

SuccessFactors is one of the fastest-growing public software companies, and a leading provider of on-demand employee performance and talent management solutions. The company enables organizations of every size, and across every industry and geography, to achieve high-performing workforces through talent acquisition, goal alignment and execution, talent development and planning, and pay-for-performance initiatives. From 92 customers and approximately 282,000 end-users in 2003 to more than 2,800 customers and more than five million end-users today, SuccessFactors’ solutions are widely deployed across 60 industries in more than 185 countries in 31 languages. Founded in 2001 with offices around the world, the company employs more than 700 people, all passionately focused on revolutionizing the future of work. For more information, please visit http://www.successfactors.com.

Headquarters: San Mateo, California

Other Locations:SuccessFactors has offices in 22 global locations, including Copenhagen, Paris, Munich, Weggis Switerland, London, Melboune, Sydney, Hong Kong, Jakarta, Manila, Singapore / Malaysia / Thailand, Seoul, Sao Paulo, Santiago, Mexico City, Lima, Rio Pedras (Puerto Rico)

Date Founded: 2001

Public or Private: Public

Mergers & Acquisitions: N / A

COMPANY SNAPSHOT

Figure 5: Sample Screenshot – SuccessFactors

Source: SuccessFactors, 2009.

Appendix I: Vendor Profile – SuccessFactors

http://www.successfactors.com



Product Overview – Talent Acquisition Product Family

Product Name

Current GA

Version Number

Date Current Version

Released

Number of Customers

on This Version

Delivery Models Supported (SaaS /

Multitenant, Hosted and / or

Installed)

Languages Supported

Development Technology

(i.e., Microsoft.NET, Java, Cold Fusion, et al)

Recruiting Management

Partofsingle

instancecodebase

Sep-09 Morethan600,000usersin

organizationsofallsizesandacross

allindustrieswith

acceleratedgrowthin

thelastfewquarters

duetothecompany’s

latestrelease.

SaaS Bahasa,Bahasa(Indonesian),

Bahasa(Melayu),Czech,Danish,

German,English(U.K.),English(U.S.),Spanish,French,French

(Canadian),Croatian,Italian,

Hungarian,Dutch,Norwegian,Polish,

Portuguese,Portuguese(Brazilian),

Romanian,Swiss(HighGerman),

Slovenian,Slovak,Serbian,Finnish,

Swedish,Tagalog,Vietnamese,

Turkish,Greek,Russian,

Bulgarian,Ukrainian,

Hebrew,Hindi,Thai,Korean,

Japanese,Chinese(Simplified),

Chinese(Traditional)

Java



(cont’d)

2009 Projected Revenue:$150.6 million, growth of 35% (year over year)

Number of Deals in 2008:More than 850 new customers (e.g., in 2009 it is roughly 40%)

Number of Employees:620+

Customers: Total Number of Customers: 2,800+Number of Customers Using the Most Recent Release: All customers

2009 / 2010 Geographic Expansion Targets:Continue to grow in Europe / the Middle East / Africa, Asia-Pacific and Latin America. All global regions have seen strong growth in 2009, e.g., Europe / the Middle East / Africa growth 169% (year over year) in 2009.

Total Number of Users:More than 5.4 million

2008 Customer Retention Rate:Greater than 90% retention, greater than 100% dollar renewals

Top 3 Largest Implementations (and number of users)1. Siemens (420,000 users)2. One of the world’s largest retailers (300,000 users)3. TD Bank (75,000 users)

COMPANY SNAPSHOT

= None. = Basic = Comprehensive

Core and Advanced Features Bersin & Associates Evaluation

Requisition Management

Requisition Approval

Pre-Screening Questions

Assessments

Job Posting

Offer Letter Generation

Candidate Career Portal

Search

Conceptual Search

Workflow Automation

Employee Referral Programs

Interview Management

Contact Management

Staffing Agency Portal

Web 2.0 Functionality

Reporting and Analytics

High-Volume Recruiting

Global Configuration



Product Overview – Other HR Products

User Experience Bersin & Associates Evaluation

Recruiter’s User Experience

Candidate User Experience

Hiring Manager’s User Experience

= Current = Leader

Other Products: Product Name and Current GA Version Number

Core HRMS

SuccessFactorsemploysaseveral-times-a-yearreleasecyclethatallowscustomersto“opt-into”new

features.Viathecompany’sSaaSmodel,allcustomersareonthemostrecentrelease.

Competency Management

Competency Content Library

Onboarding

Performance Management

Succession Planning

Learning Management

Learning Content Management

Offboarding / Transition Management

Compensation Management

Workforce Planning

Workforce Analytics

Other



Top Partners and Resellers

Service Offerings

Implementation ServicesTechnologyimplementationincludedineverydeal,optionalSuccessFactorsUniversityfortrainingandbusinesstransformationservicesthatfocusonbusinessprocessbestpractices.

Customer Service (phone and online)

Phoneandonline,tieredcustomerservice.Premiumoptionsavailable

Non-English Language Support Supportsmorethan31languages

Dedicated Account Representative

Eachcustomerhasadedicatedaccountrepresentativethroughoutthelifeofthecustomer

Technical Consulting Services Yes.

Strategic Consulting Services Yes,partofbusinesstransformationservices

Platform Hosting SaaS,multitenantsolution

Hosting LocationSecuredatacentersintop-tierhostingfacilitiesinmultiplelocationintheU.S.andEurope

Back-up Hosting Location RedundantdataserversintheU.S.

Recruitment Process Outsourcing

Notprovided

Customer Training SuccessFactorsUniversity

Partner TrainingSuccessFactorsUniversityincludescontenttomakeresellersandimplementationpartnerssuccessful.

Partners IBM,eQuest,HireRight,DDI,Lominger,Geolearning,SkillSoft

New Partners Planned for 2009 / 2010

TheSuccessCloudprogramincludesinitialpartners(CastIron,PervasiveandConformity).

Resellers TriNet,Ceridian,IBM



Key Differentiators

1. Organically built application provides seamless integration across all talent acquisition and talent management initiatives.

2. Proven track record exhibited by a large user base and high number of satisfied customers.

3. Use of the latest Web 2.0 technology to support an innovative employee and manager experience.

Bersin Analysis

SuccessFactors is a leading talent management provider with a large percentage of market share by number of customers and revenue. With the latest release of its Recruiting Management solution in September, SuccessFactors offers a best-in-class solution with a comprehensive core and advanced features set, as well as tight integration with the rest of the Talent and Performance Management suite.

SuccessFactors Recruiting Management is used by more than 600,000 users in organizations of all sizes and across all industries. Over the last year, the company has had great success with selling into large, complex organizations. In addition, the company’s global presence and experience

Regional Users GroupsMorethan10,000SuccessFactorsonlinecommunitymembers,typicallyconducting4–6regionalusergroupseachquarter.

Industry Users GroupsMorethan10,000onlinecustomercommunitymembersthataretaggedbyindustrytosupportcustomerinteractionwithinagivenindustry.

User ConferenceMorethan700customersattended(lastonehappenedonNov9–10)the5SuccessConnectUserConferencesinSanFrancisco,Chicago,NewYork,BarcelonaandMelbourne

Live Demo Yes

Free TrialProvidefreeandfreetrialsoftwareforoursoftwareservicesforthesmallersegments

Office of Federal Contract Compliance Programs (OFCCP) Best Practices

RecruitingsoftwaresupportsOFCCP-complianceincludingthroughad-hocreports

Equal Employment Opportunity (EEO) Best Practices

RecruitingsoftwaresupportsEEO-complianceincludingthroughad-hocreports

Talent Acquisition Systems 2010: Executive Summary �0


are steadily increasing. Siemens is implementing all SuccessFactors products, including Recruiting Management to all of its employees across 80 countries and in 20 different languages. As global corporations seek out multilingual configurability and local compliance, SuccessFactors is responding to this demand in several areas, including micro-career sites for various geographies and support for European Union data purging rules by country.

One area that has enabled SuccessFactors to stand out from other providers (especially those with a heritage in talent acquisition) is by providing recruiters with an internal view of the organization. SuccessFactors creates consistency from its pre-hire to its post-hire solutions by using the same job description of top performers during the recruitment process. Recruiters also have access to organizational charts and performance data. This provider is helping organizations integrate talent acquisition with performance management.

Another key differentiator is SuccessFactor’s reporting capabilities. This solution provider has introduced flexible reporting templates that can be customized by location and job level, as well as by source-of-hire reports. Source-of-hire reports include the number of people hired, the average cost to acquire and how candidates perform once they are hired.

SuccessFactors has demonstrated a strong commitment to the talent acquisition market in 2009 with advancements in reporting, assessments and communication. SuccessFactors Recruiting has custom workflows and optimizes the experience for recruiters, hiring managers and interview teams – enabling them to collaborate together to efficiently hire the best candidates for their organization.

The upcoming release in the first quarter of 2010 will include an updated user interface, as well as advanced interview management capabilities.

Talent Acquisition Systems 2010: Executive Summary �1


About UsBersin & Associates is the only research and advisory consulting firm focused solely on WhatWorks® research in enterprise learning and talent management. With more than 25 years of experience in enterprise learning, technology and HR business processes, Bersin & Associates provides actionable, research-based services to help learning and HR managers and executives improve operational effectiveness and business impact.

Bersin & Associates research members gain access to a comprehensive library of best practices, case studies, benchmarks and in-depth market analyses designed to help executives and practitioners make fast, effective decisions. Member benefits include: in-depth advisory services, access to proprietary webcasts and industry user groups, strategic workshops, and strategic consulting to improve operational effectiveness and business alignment. More than 3,500 organizations in a wide range of industries benefit from Bersin & Associates research and services. Bersin & Associates can be reached at http://www.bersin.com or at (510) 654-8500.

About This ResearchCopyright © 2009 Bersin & Associates. All rights reserved. WhatWorks® and related names such as Rapid e-Learning: WhatWorks® and The High-Impact Learning Organization® are registered trademarks of Bersin & Associates. No materials from this study can be duplicated, copied, republished, or re-used without written permission from Bersin & Associates. The information and forecasts contained in this report reflect the research and studied opinions of Bersin & Associates analysts.

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RS Talent Acquisition Systems 2010 Executive Summary Bersin 21pgs

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