Ultimate, Workday, and Slack Acquisitions Focus On Productivity And Employee Experience

It’s hard to keep up with all the AI acquisitions taking place these days, as over $10.8 billion was invested in AI startups in 2017 alone. Everywhere I look I find software companies developing tools that are smarter, more predictive, and intelligent.

In the last few weeks there have been three important deals I want to mention, each of which focuses on a single theme: using AI and conversational interfaces to improve the employee experience and make a positive dent in our productivity.

Too Much Messaging: Productivity At Work Is Suffering

As I’ve been writing about over the last year, lagging productivity is an economic problem, leading to lower wages and lots of people working extra hours. Today people spend 35% of their day reading email and we have been overspending on new tools to communicate.

Our study of the Hyper-Connected Workplace found that the average company has 7 different communication systems, and 70% of executives expect to buy more. Tech vendors are inventing them as fast as they can.

Slack now has 8 million users, Microsoft has more than 200,000 companies using Teams, Facebook has 30,000 companies using Workplace, and there are more than 1.2 billion users on Gmail, all of which can use Hangouts. And in our consumer lives, it’s even more distracting: Statistica believes there are 1.5 billion people using WhatsApp, 1.3 billion using Facebook messenger, 1 billion using WeChat, and 300 million using Skype. 

We asked people whether all these new tools help them at work and more than two-thirds told us they are getting in the way. We love our personal tools, but we’re just spending too much time dealing with them. A rather astounding study just found that we check these systems every 6 minutes and 40% of us never get 30 minutes of uninterrupted time at work.

This is ridiculous. Our communication paradigms are broken. Why should anyone in the company have the opportunity to distract us from our work whenever they want to send us an email, text us a message, or mention us on Slack?

And this is unhealthy. Research shows an enormous increase in stress to keep up with the onslaught, and in response, we are now buying “wellbeing solutions” to put a band-aid on the problem. Of course, yoga, mindfulness, and meditation are good – but isn’t it the unproductive workplace that’s really the cause?

Productivity Becomes The New Theme of HR

While I know most of you have a new program focused on the “employee experience,” I really believe the new focus for HR should be in productivity. Productivity is the key to health, happiness, and engagement at work, and lots of research supports this.

Perhaps the most convincing one is the book The Progress Principle, by Teresa Amabile. She convincingly proves, through her analysis of employee work logs, that the most enjoyable and rewarding part of work is “getting things done.” So let’s focus on making people productive, and we’ll see engagement, wellbeing, and other measures go up as well.

Of course we have to deal with issues like the workplace, management practices, goals, and rewards – but ultimately if we find ways to help people get their work done, all these programs have more focus and add more value. If you’re running a research department, for example, your talent strategy should be focused on programs that help people produce great research. Ditto sales, marketing, and every other part of business. 

And this issue, the need to make work easier, is leading to some major HR technology M&A.

Workday Acquires Stories.bi 

The first one I want to highlight is Workday’s acquisition of an Augmented Analytics company called Stories.bi. I just saw a demo of this system and it blew my mind.

This company uses AI to monitor and analyze corporate databases (focused now on Workday) to identify trends, data moving out of range, or variance from plan. It then produces a conversational interface in plain English (or another language) that points out what it learned.

Here’s an example.

As you can see, these little cards tell you precisely what’s going on, and you don’t have to dive into a spreadsheet, click around a dashboard, or hire a statistician to figure out why some business metric isnt going in the right direction. It’s an AI tool yes (called Augmented Analytics), but in reality its here for productivity. Workday plans to integrate this system into its platform and the new Workday Prism Analytics product, and it’s going to make our lives much easier.

I’ve been studying analytics for almost 30 years now, and the whole marketplace is still one of tools. While many advanced vendors like Visier now offer out of the box solutions, it’s tools like Stories.bi that will really make analytics easy for everyone. And I have to believe this type of augmentation will appear in most of our HR products.

Slack Acquires Mission

The second one I want to point out is Slack’s acquisition of Missions to create workflows and “employee journeys” within Slack. 

If you accept the fact that we are spending half our lives in these messaging platforms, why don’t we just use them to do more productive things? An army of little startups is building tools to read and interpret your messages and send hints, suggestions, and training tips to make your work life easier. (One of them, Disco, actually learns when you’re giving someone a kudo, and recommends you to send that information to their employee record). 

The product Slack just acquired is a tool to help HR departments (and others) build employee experiences right in the messaging platform. This type of “embedded HR workflow” is becoming very popular (IBM’s cognitive assistant does this also) and Slack is now making it part of the product.

While most companies don’t use Slack as an enterprise-wide platform yet (Microsoft, Google, and Facebook all want that market too), I think this feature makes that goal more possible. Slack is now what we call an “employee experience platform,” which is a huge new fastgrowing market in business. (The leaders here are ServiceNow, PeopleDoc, Salesforce, and others.) I’ll be writing more about this space in the coming months, but in a sense, Slack has just “entered this market.”

Again the goal here is productivity. We don’t have to leave our “system of productivity” to get our HR process work done, and this is an enormous trend in the market.

Ultimate Acquires PeopleDoc

The third deal I want to point out is one that my ERP friends are watching: Ultimate Software’s acquisition of PeopleDoc, a fast-growing employee experience platform.

PeopleDoc, as the name implies, built a very good business (over 1,000 customers) automating and streamlining all the HR-related documentation, paperwork, help, and various employment agreements companies need to manage around the world. The company is headquartered in France, so it serves many European companies, where management of employment contracts alone is an enormous headache.

Over the last few years PeopleDoc discovered this market for employee self-service, case management, and document and service management software (what I call the “employee experience platform” market), and they started to grow like crazy. (The biggest player in this market today is ServiceNow, and they are essentially creating a market that may become a multi-billion dollar market over time.)

While I don’t have any details on Ultimate Software’s plans quite yet, I can again assure you that this deal too was driven by the need to improve productivity and the employee experience at work. Ultimate Software, which is one of the best-managed HR software companies in the market, recently acquired Kanjoya (an AI-based employee survey and engagement tool) and this fits right into the strategy. Over time, it puts Ultimate in direct competition with ServiceNow, Deloitte ConnectMe, Salesforce, Zendesk, and other service-delivery platforms.

Watch for More On HR Technology

Fall is coming soon, so I”m already starting to work on my big annual study on “HR Technology Disruptions” for the year ahead. One of the big themes I want to point out is this enormous shift from “systems of engagement” to “systems of productivity” in the HR software market. These three deals are just the tip of the iceberg on what’s to come, stay tuned for more excitement in the months ahead.

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