HR Software
HR Facebook HR Twitter HR Google+ HR YouTube HR Software RSSSocial HR
 
HRMS Reviews
HRlab Talent Management Software Talent Management Software Business Case

Micah Fairchild Building the Business Case for Talent Management Software

3.5 stars Average rating: 3.5 (from 77 votes)
 By Kazim Ladimeji

Establishing the Strategic Need for Talent Management Systems

Talent management software is the "new rage" and these HR technologies have occupied an increasing amount of the prime real estate of HR and IT publications for the better part of the last few years—in large part thanks to the strategies these HCM software solutions offer for stemming the tide in the "war for talent". For those companies looking to build the business case for talent management software, chances are that explicitly telling your CEO about this "war" isn't necessary; the press provides exhaustive coverage on the topic and it's likely that your organization is already experiencing the effects of these talent shortages on your own business operations.

Indeed, given recent research from PWC (Annual Global CEO survey), 66% of CEOs already fear that "talent shortages will strangle their company's growth". What your top executives may not yet be aware of is that the market situation has worsened dramatically over the last 12 months. In fact, as Manpower's Annual Talent Shortage survey indicates, 52% of organizations are struggling to fill key roles—a 14% increase. Severe talent shortages are appearing in the areas of skilled trades, engineers and sales staff, the latter of which is a paramount concern for all organizations; regardless of sector or vertical market. This intensification has countless implications, not the least of which is that talent strategies employed in the past last may no longer be sufficient.

Of course alerting your CEO that passé talent management initiatives aren't working is far from needed either, as fully 83% of CEOs were ready to make changes to their people strategy in response to the talent war; many going so far as to say that "major" changes were needed. This means that the C-suite is not only open to the idea of talent management software, but is likely expecting proactive interventions from their management team to address these talent issues. Crafting the business case for a specific talent management software approach or solution though is an entirely different ball game; filled with potential pitfalls from stakeholder engagement to return-on-investment (ROI). HR professionals may well intuitively know that a well-executed, integrated talent management software suite can be the answer to many of the "talent war's" issues, but convincing company executives of this will take a cogent and well-planned strategy to secure the necessary investment required. This strategy is imperative to clearly show how a talent management technology intervention can drive needed changes. To help with that, here is HR Lab's list of the critical elements for building this type of business case.

Introduce talent management software in stages

More important than a specific vendor's talent management software features, when constructing your business case for talent management software, one of the first areas to consider is pragmatism (i.e. what can realistically be achieved). Recent research from Bersin & Associates indicates that business momentum is generally available for these organizational strategies, as roughly 66% of organizations "intend on purchasing a full or partial management suite". However, it should be noted that less than 10% of companies will actually "buy and implement as one big project". More likely, as the Bersin study found, most firms will purchase and implement one or two modules (e.g. succession, performance or Learning & Development) at a time—addressing specific organizational needs first. As such, it's recommended that organizations adopt a similar incremental approach from a business case development perspective. After all, if you can clearly illustrate exactly how each component of the talent management software can address a specific business need, the argument becomes more compelling and will likely require more effort to debunk than one that encompasses the full swath of a broad talent management offering.

Benchmark your talent management technology approach

Benchmarking your talent management technology practices against tier 1 competition is a great way to convince a CEO that your current approach to talent management technology strategy is deficient and may need to be improved. Therefore, as part of building the business case for a specific strategy or solution, you should show how your tier 1 competitors are using talent management software to gain competitive advantage. While research will likely be required, analyst firms and vendor websites offer a plethora of information to aid in the pursuit of this information; not the least of which often takes the form of client-specific case studies. Aside from providing priceless data on potential competitors, these reports also allow for: a unique type of vendor evaluation—giving organizations an "apples-to-apples" comparison snapshot; and a leg up on the market's talent management technology trends.

Further, going through the process and research of benchmarking, it is likely that data points can also be found on how other organizations (even outside of your direct competitors) have successfully created their own business case for talent management software.

Link the talent management system to overall business strategy

More than anything, executives in the C-suite will need to see how any new talent management system or solution fits into the overall business strategy and helps the organization meet specific business goals. While a seemingly daunting task, evidence abounds that shows just how effective talent management systems can be at underpinning organizational strategies. For example, recent research from Deloitte highlights that the top two HR differentiators of companies with top quartile profitability were the talent management elements of succession planning and compensation based on performance—a key indication that the organizational initiatives fueled by talent management technology are key contributing factors to profitability. What CEO would not find that argument compelling?

Bottom-line for the talent management software business case

With the current global talent shortages affecting the majority of businesses and compromising their ability to compete effectively, talent management is top of the agenda. Most CEOs are receptive to proposals that will enhance their talent management practices and in reality many of them will be expecting it. These factors create an incredible opportunity for HR talent strategists to intervene and put talent management technology on the table. However, organizations have to be cognizant of the fact that a strong business case is necessary in order for that opportunity to see fruition and for talent management software to become the key part of the solution (to addressing chronic talent shortages) it's meant to be. End

How would you rate this article?   

Implementation Category
 Filed In Categories: Talent Management Systems
HCM Tag
 Tags Tags: Talent Management Software
Trackback
 Permalink Permalink: www.hrlab.com/talent-management-software-business-case.php
Author
Author  Author: Kazim Ladimeji
Share
 Share Share:    Bookmark and Share
CRM Deployment

 

 

Share This Article

 

Quote

As Manpower's Annual Talent Shortage survey indicates, 52% of organizations are struggling to fill key roles—a 14% increase.

 

Related Articles

 

 

HR Review

Follow Us
social
social
social
social
HR lab
Home   |  HRMS  |  HR Solutions  |  Talent Management  |  Performance Management  |  Channels  |  Resources  |  Blog