Provider Perspective: HCM Software Digital World Class Matrix™

In this episode of the Business Excelleration^® Podcast, Andy Warzecha, Harry Osle, and Matt Merker share insights from The Hackett Group’s Digital World Class Matrix™ for human capital management (HCM) providers. They explore how advanced HCM technology can streamline processes, deliver actionable insights from precise data and bridge productivity gaps. They also discuss the transformative potential of Gen AI in human resources, including its applications in talent acquisition and employee development.

Welcome to The Hackett Group’s “Business Excelleration Podcast,” where week after week we hear from experts on how to avoid obstacles, manage detours and celebrate milestones on the journey to world-class performance and effective AI strategy. This episode is hosted by Andy Warzecha, leader of The Hackett Group’s Expert Advisory practices. Today’s conversation revolves around the Digital World Class Matrix™ specific to human capital management (HCM). Andy is joined by Harry Osle, chief human resources officer and principal and global lead for Hackett’s HR and Payroll, and Matt Merker, senior director in the Market Intelligence practice for human resources (HR).

To begin, Harry explains the uniqueness of the HCM study, which centers around technology as the key lever HR organizations have to drive higher engagement and strategic value. HCM technology is crucial in addressing productivity gaps, especially as HR departments strive to do more with less. The study aims to provide clients with insights into the strengths and weaknesses of major HCM vendors, enabling them to choose the best fit for their needs or optimize their current vendor relationships. Matt highlights that the study was built on four pillars: request for information responses from participating vendors, in-depth briefings with these vendors, Hackett’s existing knowledge base across various practices and multiple customer interviews for all vendors involved. This comprehensive data collection allowed Hackett to go beyond standard marketing messages, providing a deep dive into each vendor’s true value and differentiators.

Harry outlines the key takeaways from the study, which highlight the differences among HCM vendors in three primary areas: workload reduction, cost reduction and process optimization, and improved integrations and data reliability. These distinctions help categorize vendors into different stages, such as Digital World Class^®, innovative, challenger and emerging. Matt continues by discussing how vendors differentiate themselves, noting that vendors who embrace emerging technologies like artificial intelligence (AI) and automation tend to stand out among the rest.

The conversation shifts to the impact of emerging technologies, especially AI, within HR. Andy emphasizes the importance of executives leading the charge in integrating AI, not just following vendor trends. While AI is still in its early stages, it holds significant potential for reducing administrative workloads in HR, particularly in areas like talent management. Matt provides examples of AI applications, such as Gen AI for job descriptions and AI-enabled chatbots, which improve efficiency and employee experience. While customers are initially cautious about AI, they recognize its potential to increase HR capacity and drive more strategic activities. Talent acquisition and interview scheduling are key areas where AI can make a substantial impact. Customers are looking for guidance on how to start small with AI to achieve quick wins and build confidence in the technology.

Before wrapping up, Harry offers clear, actionable steps for listeners who want to make the most of the HCM study. He first advises to thoroughly read and understand the study, especially focusing on the solution profiles of vendors that are of particular interest. After reviewing the study, listeners should formulate specific questions for further clarification, whether they are assessing their current HCM vendor or considering a new one. Current Hackett clients can coordinate with their account managers to schedule one-on-one sessions for a more detailed analysis of particular vendors. For those who are not yet clients, Harry invites them to reach out via The Hackett Group’s website to set up a personalized consultation.

Time stamps:

0:49 – Welcome to this episode hosted by Andy Warzecha.

2:05 – The uniqueness of the HCM study explained.

3:37 – The study’s methodology and approach.

4:24 – Key takeaways and vendor differentiation.

10:59 – The role of AI in HR and customer perspectives.

16:12 – Actionable steps to make the most of the HCM study.