Why Salary.com Won the 2009 HR Technology Shootout

For the last two Octobers we have travelled to the HR Technology Conference to see four HR software providers show off their software in the Talent Management Shootout. While the Shootout is a relatively short event at 75 minutes (each vendor gets about a total of 10-15 minutes of demonstration time), there are often as many as 1,000 HR professionals voting, so the results are often very indicative of buyer needs, market trends, and key innovations in the market.

This year the conference focused on integrated end-to-end solutions and featured Lawson, Plateau, Salary.com, and SAP. Each vendor was asked to demonstrate a range of scenarios co-authored by one of our analysts and co-chair Bill Kutik, including:

  • Integrated performance management and development, from an employee’s  perspective:  the employee can access their profile and goals, view performance reviews and developmental suggestions, look for other jobs of interest, find gaps in their competencies, and create development plans to fill their deficiencies and achieve their career aspirations.
  • Pay for performance, from a manager’s perspective:  manager viewing their employees as a group, looking at merit-based pay drivers and allocating salary budget between employees, applying standard guidelines, and viewing and changing compensation to meet the manager’s final evaluation.
  • Talent planning and analytics, from an HR manager’s perspective:  using competency-based analysis to determine strengths and weaknesses of a team, creating multiple views of successors with graphical readiness indicators, comparing high-potentials by a variety of criteria, doing side-by-side comparison of candidates based on many background factors, creating a pool of nominees for a new role or group, and creating a development plan for those in a talent group.

These scenarios actually represent very complex business processes.  Each demands a software platform with many features, extensive data integration, an easy-to-use yet powerful user interface, and a tremendous amount of content integration (e.g. employee profiles, job families and required competencies, compensation data, performance appraisals, career aspirations, learning and development offerings, career paths, and development plans).

In a sense this year’s Shootout represents the next wave of integrated talent management solutions – bringing together the standalone applications for recruiting, learning, compensation, performance management, and succession management into real-world solutions which every organization faces.

Why we believe Salary.com Won

The four companies which competed in this year’s challenge are all excellent solution providers:  Salary.com is a leading end-to-end provider of talent management software, content and data;  SAP and Lawson are world-class ERP solution providers which provide financials, HR, talent management software and much more;  Plateau is one of the world’s most successful enterprise-class learning and talent management software providers.  So what was it about Salary.com that perhaps swayed the audience?

Today Integrated Talent Management is the Sum of the Parts

I think the bottom line is that integrated talent management software today is far more than a platform.  While HR and L&D buyers continually evaluate product features and functionality, in the real world of “making talent management decisions” the users of these systems (whether they are employees, managers, or HR people) must have three things:

  1. Easy-to-learn, easy-to-use software, which is designed to work like they do.
  2. Integrated employee and organizational information from the rich set of data needed to make talent management decisions.
  3. A core set of content which describes the organization’s job families, roles, organization structure, competencies, compensation models, and performance management processes.

When a company selects and implements a system, they rapidly find that there are many decisions about data they must make.  How are we going to describe or define our job families in the system?  What forms of evaluation and rating are we going to adopt?  What type of competency model (if any) are we going to use to assess people?  What forms of competency models will we use to train and certify people?  How will we define, evaluate, and compare compensation structures across the company?  What data elements will we use for employee profiles and succession management?  And much more.

Some of these decisions may have been made already – but in most organizations they are either not clear, not implemented, not consistent, or subject to change.  Therefore we have to realize that a talent management platform without this underlying data and content is really like an Excel spreadsheet with no data.  It has a lot of power, but you have to load it and build the models you need to run your business.  And since integrated talent management is still very new to most organizations, the “models” you need have to be developed as well.

One important concept we have realized in our research is that HR and talent management, unlike almost all other business processes, have no real “right” and “wrong.”  In accounting there are “proper and correct” ways to account for revenue, expenses, and capital.  In HR and talent management there are only “generally accepted principles” for all the processes and practices we implement.  Therefore the implementation of a talent management system often requires a lot of time talking about philosophy, what data and information we want to collect, and what type of management and employee practices we want to build.

Salary.com’s Strategy

Which brings us to the focus of this article:  Why did Salary.com win the shootout?

Over the last several years Salary.com has taken a unique, end-to-end approach to talent management.  Through a series of acquisitions, Salary.com has built not only a platform, but a complete solution – one which includes rich salary data, job profiles for a variety of industries, well developed and proven competency models for all the roles in these job profiles, and a complete user-driven focus on bringing all this content and data into an easy-to-use environment.

When one looks at the Salary.com system, we see a “complete solution” – one which can be implemented and used right out of the box.  While all talent management software vendors have access to industry job profiles, competency models, and salary data – few deliver it in an integrated solution like Salary.com.

In addition, because Salary.com has access to all this content, the product managers and engineers can design the system so it works with real-world data.  One of the biggest challenges enterprise software companies have is trying to design a system which will work well after a large enterprise’s data is entered.  It often takes years before enough customers have loaded data for the solution provider to completely understand how to make search panels, reports, and various selection windows work well.  In Salary.com’s case, because the company purchased and built all this underlying data, the product is built to be easy to use with real-world data.

Candidate CompareA simple example of “data-driven design” is illustrated in Salary.com’s scenario to enable managers to assess candidates for promotion and succession management.

Because the data in the Salary.com system is real, the scenario to assess individuals against job competencies, rank and rate these individuals against peers, and select candidates for promotion is extremely easy, intuitive, and compelling.

Bottom Line:  Think about the Entire Talent Management Solution

The bottom line is this:  whichever platform you are evaluating, you must think of talent management as a complete end-to-end solution.  This system, which will become one of the most valuable and detailed databases in your company, is ultimately a decision-making tool.   It must store and manage a wide and deep set of information and content about your people, your organization, your jobs, and your development strategies.  I want to congratulate Salary.com on their big success at the 2009 HR Technology Conference and I encourage everyone to think about talent management as a complete “program” for your company – one which requires a focus on data, content, process, technology, governance, philosophy, and leadership.