Changing HR Technology Trends in 2020

By: Chris Grunwald
HR professional discussing technology with employee

Today’s recruitment and HR landscape is one of constant change. Companies across industries must consistently deal with forces like automation, globalization, new expectations, changing demographics and distributed workforces.

And the result has left employees and HR leaders feeling more stress than ever—the former must constantly adjust to a rapidly changing world and the latter must regularly attract and retain talent.

When looking at 2020 and beyond, it’s clear that change will be the only constant. We are in the midst of a massive demographic (10,000 baby boomers are retiring every day) and technological shift (30% of work activities could be automated by 2030; 85% of the jobs people will be working on in 2030 don’t even exist yet).

To navigate these changes, HR departments around the globe are looking to tech for solutions. Here are some of the key trends I am seeing that will shape HR technology.

The Market Is Rapidly Growing

The HR technology market is exploding to keep pace with recent workforce disruption; there’s been a $16 billion investment in it in the last ten years, and half the companies were founded within the last two years. This technology is increasingly being backed by venture capital funding and private equity firms, meaning innovation and competition are at an all-time high.

Additionally, every major company is now building HR technology—for example, tech giants like Microsoft, Google (Google for Jobs) and Facebook have all entered the arena.

Solution Optimization Is Ongoing

Market expert Josh Bersin likes to frame the HR technology landscape as an ecosystem and use the analogy of treating technology offerings like apps on your phone. There is no end-to-end solution yet, so HR leaders are becoming comfortable working with multiple vendors and trying out different technologies, then optimizing those solutions as they go.

Improve Customer Experience by Improving Employee Experience

Historically, the focus has been on improving the customer experience. But more than ever companies are realizing the impact their own employees have on that customer experience—happy employees lead to happy customers, which lead to happy shareholders.

While an employee-first focus isn’t necessarily a new concept, the employee experience and engagement markets are rapidly growing, changing and consolidating to help companies attract and retain top talent. Design thinking continues to be prevalent within HR teams. They focus first on the specific needs of their employees (versus what HR thinks they need), then design a solution and a minimum viable product (MVP) they can iterate based on those needs.

Additionally, companies are becoming more reliant on multiple vendors to make up their HR technology stack. These companies commonly use Glassdoor as an input to the vendor selection decision, as one can conclude that products made by happy employees will result in happier customers using those products.

Changing User Expectations

Just as HR buyers are looking for easy adoption of vendor technology, employees don’t want to have to go out of their way to use it. As such, employees now expect the technology they use at work to be as easy to use as the technology they use every day as customers.

A recent study by Gartner on employee experience found only 1% of employees disagree with the statement, “I expect to have the same quality experience at work as I do as a customer.”

The bar has been raised on how workplace technology needs to look and feel, with the risk of low adoption if that technology is not intuitive or easily accessible in the flow of work.

Flexibility & Personalization Are Still Important—Even in a SaaS World

While the HR technology market is full of off-the-shelf, multi-tenant SaaS (software as a service) solutions, companies buying HR tech are still seeking customized, scalable solutions that meet their specific business needs. Increasingly, buyers of HR technology solutions are expecting these products to be highly personalized to their audience and their needs, as well as capable of full integration into the company HR tech stack to create a seamless experience for employees.

Artificial Intelligence Is Coming to HR Technology … But Maybe It Isn’t as Far Along as Everyone Thinks

AI is used in HR technology today—but it’s primarily focused on a few functions, such as recruitment and learning and development.  For the time being, buyers’ expectations greatly exceed the reality when it comes to AI in the HR technology market. There is also a growing number of questions around ethical standards, regulation issues and potential bias when using AI. But just because these advancements aren’t nearly as mature across the ecosystem of technology providers doesn’t mean it isn’t coming—AI will continue to expand to other functional areas as the tools mature and these questions are answered.

Making Sense of the Data

Five years ago, an HR team might not even have a consolidated view of their own global workforce. Now they have more data than they know what to do with, but don’t have the skills in-house or the time to deal with it. It’s no longer enough for vendors to serve up the data they’re collecting to the companies they work with; companies are now turning to these vendors to act as providers for data visualization tools and advanced analytics solutions. This will continue to increase as AI becomes more prevalent across the market.

Curious about some of the other trends expected to gain traction in the coming year? ITA Group team members share employee experience trends we predict will be top of mind in 2020.

Chris Grunwald
Chris Grunwald

Chris Grunwald loves to collaborate with others to solve complex problems and deliver technology that engages and motivates. He has 15 years of experience in the industry in a variety of technology roles. His life revolves around his family—including two young boys—and he enjoys running, reading, disc golf, burritos and coffee.