eRecruitment Market Trends

Thank you Gartner!!!!

One of my pet peeves over the last year has been ATS systems calling themselves talent management applications. Anyone reading my posts knows this bugs me to no end. Gartner's eRecruitment white paper clearly states a difference between Talent Acquisition Suites (TAS) and Talent Management Suites (TMS).

They state that Peopleclick, Taleo and Virtual Edge are all TAS vendors. Kenexa, Recruitmax and Workstream are all TMS vendors. Not to toot my own horn, but this matches well with my lists for ATS and TMS.

Talent Acquisition Suites/Talent Management Suites: In addition to vertical-market depth, we also expect to see more competition based on product breadth. TASs that merge e-recruitment and service procurement (that is, contingent workforce management) will be one level of differentiation. PeopleClick and VirtualEdge are good examples of vendors that provide TASs. In addition, there are vendors that are providing even broader suites of products — talent management suites — which expand into performance management, career development, succession planning, learning and compensation management. Kenexa, Recruitmax (via its acquisition of CCH/KnowledgePoint) and Workstream (through its various acquisitions, including, most recently, Kadiri) are good examples of vendors that provide broader suites of products. We believe customers prefer these integrated suites more than niche e-recruitment solutions, all else being equal. The integrated suites can leverage common capabilities, such as competency management, workflow and reporting/analytics. In addition, there are reporting and analytics, which are not easily replicated. For example, if an enterprise wanted to find a correlation between high performers and sources of talent, it would be harder to pull data from separate e-recruiting and performance management solutions than it would be from an integrated solution. Customers should understand not only how their e-recruitment vendor can support their e-recruitment requirements, but also how it will participate in the broader suite markets.

Talent Management searches are up

This is actually a very poor polling technique, but it does at least show that companies are thinking about talent management. Unfortunately, I have no idea what people mean when they say talent management. To me, TM is a complete suite that runs through recruiting (talent acquisition), to learning and retention. Unfortunately, many applicant tracking systems are billed as talent management software, when they really only cover 25% of the functionality that's needed in a comprehensive suite.

Nonetheless, hr.com has a poll out there that states roughly 20% of the 150ish respondents are going to be buying a TM package this year. 70% will not and the other 10% are in between. In my opinion, 1 out of 5 companies looking for software is huge.

KPMG does not know the difference between DB and DC?

Well, we all know there is a HUGE difference between accountants and actuaries. (Do I need to tell any actuary jokes?) But this press release is a rather harsh example of why a good HR consulting firm lime Mercer, Towers Perrin or Wyatt should be doing your benefits consulting and not a Big 4 firm.

The Daily Telegraph, via NewsEdge Corporation :
KPMG is one of Britain's biggest accounting firms, employed (inter alia) to audit company pension schemes, so it should surely boast the technical expertise to tell the difference between a defined contribution scheme and a defined benefit one. Yet when it came to the firm's own scheme, it needed the High Court to decide. KPMG invited the court to agree that it had been running a defined contribution scheme all these years, so that the risk should fall on the retired partners.

When the court disagreed, the firm appealed, and this week the Appeal Court threw the accountants out so comprehensively that it even refused leave to appeal to the Law Lords. The shortfall in the scheme will have to be found by the existing 553 partners, and at pounds 70m (in 2002) promises to make a nasty dent in the firm's operating profits. The very fact that there is a shortfall is a bit of a giveaway; in a defined contribution scheme, the question doesn't arise, since the nascent pensioner takes whatever the contributions have grown to, and buys his annuity. KPMG's case was that benefits were calculated without reference to earnings, but the court has disagreed. It's an important case, and a curious one.

KPMG is highly likely to be auditing your company pension (there are only three other big firms on the planet) and if they can't tell the difference between DB and DC, then it's a pretty poor lookout. In the increasingly frenzied game of pass the parcel being played between employers and employees faced with pension deficits, the small print is important. It's created lots of lucrative work for accountants, but KPMG may find the clients less inclined to appoint them in future.