Strapped Companies Looking to Get More From HR Technology

With cost control paramount and most HR budgets shrinking, employers are looking to make changes that will get the most from their HR technology, according to a forthcoming survey by Watson Wyatt, a leading global consulting firm.

Watson Wyattís 2009 HR Technology Trends Survey found that 61 percent of employers are taking steps to optimize their current service delivery models (which includes their mix of HR technologies, call centers and vendors). A third (33 percent) are reviewing and updating all vendor contracts, and only 27 percent are staying the course. Watson Wyattís survey was conducted in February and March 2009 and includes responses from 181 large employers.

ìA thorough review of the way HR services are being delivered can reveal hidden costs and quick ways to leverage existing investments,î said Jon Osborne, senior technology consultant at Watson Wyatt. ìMany companies have already invested heavily in HR technology but have not yet taken action to integrate applications and ensure their processes are working seamlessly together.î

Transition costs are blocking change

When asked to rank the top three factors that would prevent changes being made to HR sourcing strategies, 43 percent of respondents cited transition costs as the most important, followed by the lack of a business case (31 percent) and avoiding disruption in current service (11 percent).

ìCurrent economic pressures make the decision to invest in or change HR technologies or service providers especially difficult. Is it better to put off changes and avoid short-term transition costs, or to invest now and attain long-term cost savings and enhance the employee experience?î said Tony DeNucci, senior leader in Watson Wyattís technology and administration solutions practice. ìItís more than just a question of the cost of change; itís also a question of the cost of not changing. The companies that realize this are taking action, as demonstrated by current market activity.î

Companies are deploying Web 2.0 initiatives

The survey also found that companies are using a variety of Web 2.0 technologies such as social networking (23 percent), podcasts (19 percent), blogs (21 percent) or wikis (15 percent) to communicate internally with their employees. For these companies, the level of satisfaction is high ó approximately three in five (59 percent) are satisfied with their use of podcasts, half (49 percent) are satisfied with their social networking technologies, and two out of five (40 percent) are satisfied with their use of blogs and wikis.

ìWeb 2.0 is still a relatively unknown quantity for many companies,î said Michael Rudnick, senior technology consultant at Watson Wyatt. ìHowever, the move towards Web 2.0 is an inevitable shift. While the current downturn may be discouraging the implementation of these new technologies, as companies begin to understand the capacity of social networking to act as a powerful communication tool, we can expect these numbers to pick up.î

The full HR Technology Trends Survey Report will be available in May 2009.

A flash report of the findings is available at: