Social HCM is a Journey, Look before you Leap

By Jim Lundy

The Social Human Capital Management (Social HCM) market just got more interesting because it is going Social. This week Salesforce is throwing down the gauntlet and announcing its Work.com Social Performance Management offering. Most that follow HCM know that Salesforce bought Rypple in 2011 (see our First Cut: Salesforce buys Rypple, Signals Move into HCM). Expect lots of announcements at Dreamforce about this move.

Social HCM and the new Merger Wars

Of course Oracle isn’t standing still either and yesterday they announced they were buying Select Mindsto bolster their Social Talent/HCM capabilities in areas such as Social Recruiting and alumni networks. Oracle’s Social Network, which recently started shipping, is one to watch as it is integrated with other Oracle apps in a fairly seamless fashion. You also can’t count out SAP’s recent acquisition of SuccessFactors, who has been offering its Jam Social Network to its clients and they are gaining some traction. Even more important, IBM has also jumped into the Social HCM game with its purchase of Kenexa (see our First Cut: IBM Shifts into HCM Software and Buys Kenexa for $1.26 Billion).

We expect that Salesforce’s Work.com announcement and Oracle’s counter move will cause a lot more M&A activity to the delight of founders and VCs who placed the early bets in Social HCM capabilities. One thing to keep a watchful eye on is Salesforce’s Force.com growing app ecosystem. This is one of Salesforce.com’s not so secret weapons, since there are a mulitude of third party apps that can be integrated with its Sales, Service or Marketing Cloud. We expect to hear more this week about Work.com as well.

Social HCM and Pricing

One of the things that will come up more and more is what is the value to the enterprise vs the price being charged. We wrote about Rypple and its initial pricing earlier this year. The pressure is on for the incumbent software providers to add social capabilities and price will be a sticking point. Suffice to say, IT will probably have advice for the HR pros since collaboration apps already exist in the enterprise. A perfect example is Microsoft SharePoint, which with SharePoint 2013 is looking much more Social. Combine that with a free entry point, such as Microsoft’s recent acquisition of Yammer, and you have an inexpensive way to get started.

With standards for things such as Activity streams and Social Gadgets (app plugins via Open Social), the question is this: Will your Collaboration provider become the Social Platform provider of record or will your HCM/Talent Provider be able to step up and do it all.

Social HCM, Look before you Leap

There is still a lot of confusion in the market about what all of this means. Socially enabling applications is all the rage and we have now reached the phase where activity streams are common in almost every software category. HCM and Talent is no exception. There will be tremendous pressure for HR executives  to make the leap into Social. Clearly, Social Recruiting is a great place to start, since finding talent one of the biggest challenges today in almost every market. Put aside recruiting, Performance looks to be another area of interest, partially because as any great manager knows, it is the feedback that happens daily, weekly and monthly that matters most, not the annual performance review. Social Performance offers new ways to help managers and peers tell others they are doing a good job.

This brings us back to the question of where to start with Social. Many HCM providers today offer activity feeds, but not a full Social Platform. We analyzed 22 Social Platform providers recently and there were a number of HCM vendors that made into the evaluation. See the overview of our report for the list of vendors.

We also outlined the five priorities of a Social HCM strategy in one of our Syndicated Research. If you are trying to figure out where to start with your Social Strategy, now is a good time to start working with Aragon Research.

This is an ongoing discussion and one in which there will be many more chess board moves before the market shakes out. Look for more posts from us this week. Social HCM has become a hot topic. If you are at Dreamforce, look us up (@JimLundy and  @Mikeanderson0).