**Updated February 2018**
The debate over whether HR technology customers will adopt platforms or point-solutions is over and there is a clear winner emerging:
The informed customer.
For a long time now in the HR technology market we’ve been discussing and debating whether HR customers would adopt platforms or point solutions in order to address their HR technology needs.
The argument for a platform is the seamless end-to-end process and data flow it offers the customer and users. The argument against the platform is that while covering all of the bases in any given HR tech segment, platforms almost never do everything well.
The argument for the point solution is having the “best of breed” or latest and greatest innovation to use in any given scenario. The argument against the point solution is the challenge of complexity classically associated to integrating systems. This only gets compounded as you add more solutions to your tech stack.
Platform vs. Point-Solution was a worthwhile argument in 2008, but it’s getting less and less relevant as time and technology marches on.
HR technology customers are increasingly sophisticated. Their expectations of software to use in their business mirrors the rest of the B2B technology landscape. They want better, easier to use, interfaces that require little to no training. Like the consumer oriented systems they use for everything from home finances to social media. They also expect their data to be portable. They have grown tired of vendors that can’t support getting data in or out of their systems.
HR leaders have grown impatient with platform vendors that keep customer data hostage in order to hold onto their encampment on the “HR user’s desktop”. It’s an old school mentality designed to maintain market-share by being the only lens the user gets to look through. Many platform vendors fear that their value will be diminished if data is flowing out of their system and users get their “actionable insight” somewhere else. It hasn’t been a successful strategy in the Saas/Cloud-age for both the tech vendors that choose this path as well as their customers. Customers have found ways to implement point solutions they see value in, and to get the data in and out of their systems to support its use. Even when this meant a high degree of complexity doing so, making trade-offs with regard to usability of the integration, or both. I met a medium sized business a few weeks ago that had SIXTEEN different HR tech applications running alongside their legacy HCM platform. It’s a mess, and it isn’t nearly the biggest number I’ve heard over time.
So, what’s different now?
Along with improvements in user experience I see two technology advancements that have changed the landscape for HR technology customers moving forward.
It’s now an API world. API is the acronym for “application programming interface”, the set of routines, protocols, and tools for building software applications which specifies how software should interact at a component and interface level. Modern HR technology applications are now expected to come with a complete and transparent API. But, this isn’t just a technical issue. Culturally, the newer, emerging developers would never consider holding your data hostage. It’s your data. They are less concerned with maintaining the “real estate” on your HR desktop and more concerned with maintaining their relationship with you as a customer.
Modern HR technology vendors that are leveraging an improved user experience with truly open APIs are really the new standard. I expect any vendor launching a new product after 2010 to have this in it’s DNA both technically and culturally. Good examples in HCM are Namely for employers with up to 3500 employees, Gusto for employers with less than 100 employees, and Dayforce by Ceridian for employers with 500 to 50,000 employees, or Infor for 5,000 employees and larger. In talent acquisition, take a look at vendors like Greenhouse or gr8 People. In employee engagement vendors like Culture Amp, TemboStatus, and Glint are good examples.
Platform as a Service (PaaS) solutions are emerging in HR. PaaS is an architecture in cloud computing that provides a platform allowing vendors and customers to develop, run, and manage web applications without the complexity of building and maintaining the infrastructure typically associated with developing and launching an application. This means that when you invest in a PaaS platform you have the room to build out the next best of breed application and fit it seamlessly into your workflows. It also is inherently a more open architecture that normally allows for more seamless API integrations between systems. A great example of this is salesforce.com. Consider their “force” platform and the almost incomprehensible number of applications that have been built on it. And, it’s taking hold in some HR environments that are impressive. A growing number of HR technology vendors have built solutions on the salesforce.com platform. Vendors like Cornerstone OnDemand for just-in-time sales learning, FinancialForce for HCM, and jobscience for talent acquisition, to name a few. These vendors have taken advantage of innovations driven by Salesforce on an ongoing basis and offer customers with an incredibly agile future as they look to keep up with trends that users demand.
HR has its own PaaS offerings that are starting to take off. Consider how quickly trends in talent acquisition go in and out of favor with sourcing and recruiting teams. The ability to build applications quickly for the “the next thing”, or to seamlessly integrate the next hot recruiting app should really be a core requirement for talent acquisition teams. Gr8People founders and developers lived through the challenge of keeping up with recruiting tech trends in their previous life when they built Virtual Edge, the market-leading ATS that was ultimately acquired by ADP. When they introduced their new recruitment collaboration, marketing, and process platform they started with PaaS at the core. Their early traction seems to be validating the model.
Tips for HR technology Customers
The platform vs. point solution battle is over and as an HR technology customer, YOU WIN! But, as I stated earlier, it’s the informed customer that really wins. We’re entering an age of workforce and HR technology where you get to have your cake and eat it, too. Get the platform to drive the core processes and seamlessly integrate the right apps at the right time.
But, you’ll have to sift through an awful lot of “vendor noise” about their ability to integrate with or without an API. And, you’ll quickly learn that not all APIs are created equal. Some just clearly define a weak integration offering.
My advice to you is to start vetting it out during your buying process. Take a page from some of your peers in HR and get access to product and service teams at step one of your interaction with a vendor. Get the answers you need. Better yet, get the vendors to validate the integrations that you need BEFORE you sign off on a license. Remember that in this world of cloud computing you’re choosing a partner as much as a vendor, if you can’t easily get this access, you shouldn’t give the vendor your money. And, if you have an existing vendor that can’t make these things happen? Start moving on now.
Consultants like Mark Stelzner’s IAHR in HCM or Elaine Orler’s Talent Function in talent management and acquisition can help you with the process of switching. And, I’m always happy to help you with vendor selection strategy.
If nothing else, just stop letting anyone talk you into or out of a platform or a point solution. Focus on what your users need for functionality to support your business and make an open and transparent API and/or PaaS a core requirement.