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BERSIN & ASSOCIATES © 2007 BERSIN & ASSOCIATES Research Bulletin | 2007 About the Author Josh Bersin, Principal Analyst How to Build a Talent Management Systems Strategy Introduction One of the biggest challenges in HR and training today is that of developing an integrated systems strategy. This bulletin addresses this topic and provides readers with guidelines and considerations from our ongoing research in this critical area. The Tapestry of HR Systems First, we must recognize that in today’s IT environment, most organizations already have a collection of IT systems - which, depending on the setup, could function like a tapestry, a quilt or a tower of Babel. In whatever array, these systems were developed and implemented over the years, based on the maturity of the systems vendors themselves. Almost all organizations have a payroll system, and most have an HRMS. The term “HRMS” refers to the underlying system that stores all the primary (and constantly changing) information about employees, contingent workers and contractors. It is typically the system of record for important information like salaries, current job and position, benefits, and often (but not always) the organizational hierarchy and reporting structure. The HRMS is largely a database system, used by back-office HR staff and serving as the source of truth for information about employees in the company. These systems were designed to facilitate the transactional aspects of HR – assigning benefits, hiring, relocating, paying and terminating people. But as we all know, there are many complex and interrelated processes that make up talent management. These include: October 23, 2007 Vol. 2, No. 28 One of the biggest challenges in HR and training today is that of developing an integrated systems strategy.

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Page 1: Vol. 2, No. 28 How to Build a Talent Management Systems Strategy

BERSIN & ASSOCIATES © 2007

BERSIN & ASSOCIATES

Research Bulletin | 2007

About the Author

Josh Bersin,Principal Analyst

How to Build a Talent Management Systems StrategyIntroductionOne of the biggest challenges in HR and training today is that of

developing an integrated systems strategy. This bulletin addresses this topic

and provides readers with guidelines and considerations from our ongoing

research in this critical area.

The Tapestry of HR Systems

First, we must recognize that in today’s IT environment, most organizations

already have a collection of IT systems - which, depending on the setup,

could function like a tapestry, a quilt or a tower of Babel. In whatever

array, these systems were developed and implemented over the years,

based on the maturity of the systems vendors themselves.

Almost all organizations have a payroll system, and most have an

HRMS. The term “HRMS” refers to the underlying system that stores all

the primary (and constantly changing) information about employees,

contingent workers and contractors. It is typically the system of record

for important information like salaries, current job and position, benefits,

and often (but not always) the organizational hierarchy and reporting

structure. The HRMS is largely a database system, used by back-office HR

staff and serving as the source of truth for information about employees in

the company. These systems were designed to facilitate the transactional

aspects of HR – assigning benefits, hiring, relocating, paying and

terminating people.

But as we all know, there are many complex and interrelated processes

that make up talent management. These include:

October 23, 2007 Vol. 2, No. 28

One of the biggest challenges in HR and

training today is that of developing

an integrated systems strategy.

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How to Build a Talent Management Systems Strategy Josh Bersin | Page 2

• Sourcing and recruiting;

• Performance management and succession planning;

• Leadership development;

• Workforce planning;

• Compensation and incentive rewards; and,

• Learning and development.

These HR processes, which have become increasingly important each

year, have spawned the development of systems for automation and

improvement. In the late 1990s and early 2000s, the applicant tracking

market took off leading many companies to implement stand-alone

systems for recruiting. These systems focused on automating the

process of sourcing, tracking candidates and managing the ongoing

workflow of recruiters, managers and staffing leaders. In the early

2000s as e-learning exploded, the learning management systems

market grew up – and today most organizations realize that they need

a highly sophisticated system to manage training administration and

the learning programs in their companies. Now, we are in the heat of

Copyright © 2007 Bersin & Associates. All rights reserved. Page 1

2000 2003 2009

Mar

ket G

row

th -

Ado

ptio

n

2006

HRMS

IntegratedSolutions

IntegratedTalent Management??

BenefitsAdministration

Compensation

HiringRecruiting

ApplicantTracking

RecruitingSourcing

E-LearningCompensation

LearningManagement

LCMS

PerformanceTalent

PerformanceManagement

CompetencyMgt

SuccessionPlanning

Figure 1: Brief History of HR Systems

Source: Bersin & Associates, 2007.

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the “performance management” systems wave, in which organizations

are intent on trying to automate and improve their performance

management and succession planning processes. To add to the

confusion, the HR software vendors are now scrambling to pull together

all these talent management applications into integrated suites.1

In our ongoing discussions with companies dealing with these issues,

we find that most organizations are in a situation where they have a

combination of:

1. Existing legacy systems (often the HRMS or even LMS and

recruiting application);

2. A tremendous demand for new systems (often the performance

management, succession planning or competency management

system); and,

3. A strong set of existing IT architectures and experiences that both

cloud and color its level of risk-tolerance for new vendors.

In fact, many CIOs and HRIT managers are trying to slow the process

down, trying to hold HR back from buying too many systems from too

many vendors that may not work together. Of course, they have good

arguments: if we cannot integrate the data and underlying workflow

from all these different applications, where will we end up when we

want to make strategic decisions?

Why Buy Systems? Start With the Business Problem

As analysts who study business-driven solutions, processes and systems,

we enjoy a pragmatic perspective. The first question an organization

must answer in their quest for a systems strategy is “what problems

are we trying to solve?” Frequently research members ask us for ROI

templates for cost-justifying a certain type of software system, and

typically what we tell them is that there are many different ways to

justify these systems.

1 For more information, Talent Management Suites: Market Realities, Implementation Experiences and Vendor Profiles, Bersin & Associates / Leighanne Levensaler. Available November 2007 to research members or for purchase at www.bersin.com/tmsuites.

If we cannot integrate the data

and underlying workflow from

all these different applications, where

will we end up when we want

to make strategic decisions?

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The problems organizations wish to solve tend to fall into three

categories, in a hierarchy of priority (see Figure 2).

In the case of each of the type of HR systems discussed previously, there

are a myriad of potential benefits at each level. Unfortunately, because

of the state of the systems market – and this will probably be true for

many years to come – each systems vendor in each category of the

market has unique strengths in different areas.

Before you start shopping for technologies or decide that a given suite

is the best approach, it is very important to decide what overall business

problems you are trying to solve. If you do not make this important

and often soul-searching step, you will later find yourself very confused

by the wide variety of systems, architectures, delivery models and

implementation strategies before you.

Priority Problem Benefit

1 Automation Reduce the cost of errors, save time, reduce paper and better meet compliance requirements.

2 Process Improvement Better implement existing processes and perhaps even improve them, because the software will facilitate a more integrated and complete, data-rich (current and historical) approach to a given process.

3 Business and Talent Breakthroughs

Ability to do things we could not do before.

Figure 2: Category and Hierarchy of Business Problems

Source: Bersin & Associates, 2007.

Before you start shopping for

technologies or decide that a given suite is

the best approach, it is very important to decide what overall

business problems you are trying to solve.

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Your Talent Management Strategy Comes First

Our best-practice research2 clearly shows that the greatest business

results from HR systems come not from the systems, but from the

underlying strategies and processes behind them.

In fact, in our research into the business impact of 62 different talent

management processes, we identified 22 processes today that drive the

highest levels of business impact.3 Many of these center around areas such as:

• Implementing a coaching and development-based performance

management process;

• Using strategic competencies in the recruiting, performance

management and leadership development process;

• Implementing skills and competency-based workforce

planning; and,

• Creating personal and organizational goals that align with current,

strategic business goals.

2 For more information, High-Impact Talent Management: Trends, Best Practices and Industry Solutions, Bersin & Associates / Josh Bersin, May 2007. Available to research members at www.elearningresearch.com or for purchase at www.bersin.com/hitm.

3 For more information, www.bersin.com/top22.

Copyright © 2007 Bersin & Associates. All rights reserved. Page 1

Business Drivers for TM Systems

BusinessValue

Automation

ProcessImprovement

Business andTalentBreakthroughs

Automate, save paper,save time, reduce errors,meet compliance requirements

Improve individual processes, facilitate betterdecisions at manager level, implement HR self-service,implement competency-based talent management, giveHR better information for workforce planning.

Improve individual and organizational performance, align people, make better people decisions, align L&D with skills gaps, improve the leadership pipeline, increase retention and quality of hire, create greater pools of internal candidates, increase business speedthrough talent pools and succession plans.

.

Figure 3: Typical Business Drivers for TM Systems

Source: Bersin & Associates, 2007.

Our best-practice research clearly shows that the

greatest business results from HR

systems come not from the systems, but

from the underlying strategies and

processes behind them.

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These processes are not dependent on software solutions at all. In fact,

many of them are often more dependent on your company’s culture,

training and generalized approach. If you want your investment in

talent management systems to drive dramatic business impact – and

positive change – we encourage you to consider these processes

strategically and tie them directly to organizational business goals.�

What role does technology play? Once you decide what strategic new

processes are key to your organization’s business success, various systems

are available to implement these processes in numerous ways. You must

now determine which of them are capable of solving the problems you

identified in your particular organization, and which have the

� Bersin & Associates High Impact Talent Management® process is designed to help organizations build this business-driven talent management strategy. For more information, High-Impact Talent Management: Trends, Best Practices and Industry Solutions, Bersin & Associates / Josh Bersin, May 2007.

Figure 22: Bersin & Associates Talent Management Framework®

Source: Bersin & Associates, 2007.

Co

mp

en

satio

n

Talent Strategy & Planning

Critical TalentStrategy

Target Metrics& Measurement

ProcessGovernance

SystemsStrategy

BusinessStrategy

PerformanceManagement

Goal-SettingCascading GoalsSelf-Assessment

Manager Assessment360 Assessment

Development PlanningCompetency Assessment

Sourcing &Recruiting

SourcingCandidate Pools

AssessmentEmployer Brand

RecruitingSelection

SuccessionPlanning

Calibration MeetingsTalent Reviews

HiPo IdentificationCareer Planning

Talent Migration Plan

Formal ProgramsStretch AssignmentsExecutive Education

CoachingMentoring

Job RotationAssessmentEvaluation

LeadershipDevelopment

HR

Syst

em

s&

Metr

ics

Competency Management LeadershipCompetencies

FunctionalCompetencies

CorporateValues

JobProfiles

Co

mp

ensatio

nPlan

nin

gB

ase Co

mp

ensatio

n

Plans

Pay for

Perform

ance

Sho

rt- and

Lo

ng

-TermIn

centivesLearning & Development

Onboarding ManagementTraining

LeadershipCurricula

Coaching / Mentoring Programs

Role-BasedCurricula

CertificationPrograms

OperationalTraining

LearningStrategy

DevelopmentalAssignments

Content Development& Delivery

e-

Figure 4: High Impact Talent Management® Framework

Source: Bersin & Associates, 2007.

Once you decide what strategic new

processes are key to your organization’s

business success, various systems are

available to implement these processes in

numerous ways.

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specific features, ease-of-use, workflow, security, domain management

architecture and delivery model that work in your company.�

There exists today a series of “breakthrough new processes” just now

becoming available, which may also be important to your strategy.

• Integrated performance and learning. Align L&D resources and

programs directly with organizational performance and talent needs,

by taking the individual performance plans of each employee, aligning

them with corporate goals, identifying organizational and individual

learning gaps, and then developing strategies to meet these goals.

• Integrated performance management and succession

planning. Improve your leadership pipeline, the effectiveness of

leadership development and facilitate rapid change, by taking the

individual goal achievement, competency assessments, experience

and feedback from each employee and fitting them into succession

pools for management, leadership and professional roles.

• Pay for performance. Create a performance-based culture by

taking the individual and organizational results from a given

period and providing simple or complex compensation structures

to pay high performers for their efforts.

• Integrated recruiting and performance management. The

results of performance plans and competencies can be used to

create profiles of high-potential employees during the hiring

process. This process can also be used to improve hiring practices

– by monitoring the performance and retention of candidates

over time, it is possible to isolate a profile of high-performing

candidates in order to improve recruiting effectiveness.

• Integrated career planning and self- or manager-directed

career and development planning. Establish architected career

paths – built around competencies – which allow employees and

managers to direct people (or themselves) into new roles through

structured and unstructured development. “Building from within”

improves retention, engagement and satisfaction. It helps people

manage their careers, while helping the organization manage

people into the roles of greatest need.

� For more information, Talent Management Suites: Market Realities, Implementation Experiences and Vendor Profiles, Bersin & Associates / Leighanne Levensaler. Available November 2007 to research members.

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All of these strategies make sense to companies, but the question

is “which do you really want to achieve now?” Different systems

strategies will enable different possibilities.

When we help companies select LMS systems, for example, we

encourage them to differentiate between which particular processes

they “must accommodate” and which are “nice to haves.” If you decide

it is essential for you to automate a complex revenue-generating

customer training process, then this use case is a mandatory set

of requirements for any system. If you must provide integrated

development planning with your performance management process,

then it is important to consider an integrated product set with both

performance management and an LMS.

Consider a Three- to Five-Year Roadmap – Processes and Systems

As you establish the talent management strategy above, it is important to

realize that each of these initiatives will take time to design, implement

and roll out. In many organizations there is already a well-established

process for performance management or succession planning, for

example. It may not be completely adopted enterprisewide, but the

process is well-established, successful and widely understood. In this

case, the software should facilitate the process that already exists and not

necessarily break it just because the software may not have a

particular feature.

Our research shows that in the first one to two years of a performance

management systems implementation, for example, you will likely see a

negative return. The first year will often require a long period of process

design, data integration (e.g., competencies and job profiles), training and

change management. Most organizations adopt a pilot program for the

first year’s review. In the second year, you work out the bugs in a broad

implementation and then in the third year, the system starts to provide

high levels of value. If you then decide to integrate this process with

development and career planning, you must consider the fact that these

more advanced capabilities may not be ready until years three or four.

We routinely assist organizations in building these roadmaps. Often

one of the dependencies in the implementation of talent management

Differentiate between the processes you

“must accommodate” and those that are

“nice to have.”

It is important to realize that each

of these initiatives will take time to

design, implementand roll out.

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systems is the development of competency models or integrated learning

plans, and this must also be considered. In addition, if your roadmap

covers a three- to five-year period, it forces you to look at a hot startup

vendor in a slightly different light. When you share your roadmap with

the vendor, do they see their product strategy aligning with your needs?

Think “process first, system second” and you can build a roadmap that

matches your organization’s business-driven talent management strategy.

Think Use Cases, Not Features

As you define the processes you want to automate and how the system

will be used, it is important to develop real-world use cases for your

organization. A “use case” is not a set of features – it is a complete

scenario that describes how your organization does (or will do) a specific

business process.

If you have an existing process for performance appraisal and evaluation,

for example, write it down – including all the surrounding ways that this

process is informed by- or supplies information to other processes. By

doing this you will create a scenario that enables the systems vendors

to show you precisely how the software will fit (or not fit) into your

environment. While many organizations do fit their processes to the

software, this can often be dangerous – because there may be a step in

your current set of requirements that is impossible or awkward to do in

the systems you select.

While “feature lists” are helpful for general analysis of vendors, they will

not do you much good in the final selection – and our experience with

many companies in their selections shows that use cases often tell you

which vendors truly understand and have solved the problems you want

to solve in your systems strategy.

The Importance of “Profile Management” and Integrated Data about People

One of the important and difficult issues in today’s HR systems landscape

is that data about people is often sprinkled around in many places. When

you want to make strategic decisions, such as:

Think “process first, system second”

and you can build a roadmap that

matches your organization’s

business-driven talent management

strategy.

A “use case” is not a set of features – it is a complete scenario that describes how your organization does (or will do) a

specific business process.

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• Who to hire?

• Who to promote?

• Who to move into a new position?

• Who to give a raise?

• Who to put into a high-potential track?

• Who to put into a critical training program?

These decisions need a wide variety of data about people. This data

is now often called the “person profile” in the jargon of HR systems

vendors. The person profile includes many things, such as:

• Age, demographic information, salary history and job history;

• Educational history, prior experience, managerial experience and

professional experience;

• Certifications, designations and transcripts;

• Performance ratings, feedback and 360-degree assessments;

• Languages spoken, location preferences and physical limitations;

• Personal career goals, development plans and training history;

• Developmental assignments, feedback from executives and

other leaders;

• Competencies, traits, psychographic assessments, and so on.

Where is all this data located? All over the place. Some of it is in the

employee’s resume, some in the HRMS, some in the applicant tracking

system, some in a file cabinet with performance appraisals, some in the

learning management system, and much of it is located in the desk or PC

of the employee, his / her manager or others in the organization.

When we start to look at leadership development and strategic talent

management systems, it becomes important to decide where the

system of record will be for each of these types of data. If you decide,

for example, that skills-based workforce assessment and planning is an

urgent process for your company, you may find that you want to put the

“core competency data” for your organization into your LMS – because

the LMS typically has the assessment tools and learning programs to

provide these assessments. If you make this decision, however, you

now must decide how this data will be transferred regularly into the

performance management and succession planning system.

When we start to look at leadership development and

strategic talent management

systems, it becomes important to decide

where the system of record will be for

each type of data.

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Some companies build data warehouses (typically data marts) to pull

information from all the record systems to create the “succession

planning” or “workforce planning” employee profile record. In today’s

HR systems environment this is often the best approach, but before

you make this decision it is important to discuss the issues and evaluate

vendors based on their capabilities to be the system of record. Many of

the new HR systems vendors are so young that their employee profiles

are not yet sophisticated enough to handle all the data elements

you need.

At this stage, it is important to partner with IT. Typically the HRIT

organization owns the organizational HR data model and may already

have developed a data-architecture for people-related processes. Once

they have this architecture, it becomes much easier to evaluate systems

vendors based on their level of richness, openness and compliance with

this architecture. If the structure is not yet in place – now is the time to

request IT’s assistance. This is one of the most valuable things IT can do to

help you.

Consider Your Organization and Governance

We should not understate the importance of your organizational

structure and governance. Every IT system – particularly those used by

employees and managers – needs owners. These individuals must make

decisions about how the system will work, what reports will be available,

who will have access to what information and who will be able to enter

what type of information.

Without even considering the system security, domain management or

other features of the software, the first question you must ask is “how

will we administer and manage this system? For example, will the U.K.

subsidiary have the authority to change part of the process in some way? In

the LMS world this is very important, because training functions are often

distributed to different functional areas and business units. In the world

of performance management, organizations often modify the process for

hourly workers versus mid-level managers versus executives. In the world of

recruiting, the recruitment process will vary across business units.

Many of the new HR systems vendors

are so young that their employee profiles are not

yet sophisticated enough to handle all

the data elements you need.

One of the most valuable things IT

can do to help you is to develop a data architecture for HR-

related processes.

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Before you shop and evaluate systems and vendors, it is important

to consider what distributed administration is needed, given your

organization’s structure today, and how you will govern and manage

this administration. Implicit in these decisions will be the definition of

different systems roles: super administrators, administrators, managers,

employees, HR users and executive users. How each of these people

use the system will vary. These governance decisions will lead to set of

requirements for roles, domain management, security and reporting for

the selection of systems vendors.

There is no substitution for building real-world use cases – specific

examples of how you implement a given process, how it is administered,

what types of reports will be used and how it will be configured. These

use cases should be documented in detail and the vendors you consider

will gladly show you how their systems accommodate these scenarios. We

have a wide variety of use cases you can build upon to create the specific

scenarios you need for your organization.

Consider Your Existing Staff, Systems and Tolerance for Risk

Unless you are a small company or a startup, it is likely you already

have a lot of experience with some types of HR systems. You may be a

“PeopleSoft shop” and have many people trained on the PeopleSoft

technologies. As a result of that experience, your IT organization may

decide that they must continue the investment in this area – or in fact

many tell us the opposite, that they no longer want to invest in these

particular technologies.

You may have very few IT staff available. In this case you may need a

vendor with extensive professional services and experience with an

outsourced solutions provider to get you the help you need. Many LMS

vendors, for example, provide complete solutions including systems

implementation, content integration, report definition and more.

You may have an LMS or ATS system that is highly successful, and you

have a strong relationship with that vendor – therefore you want to

invest in that vendor’s products first. If you find that the fit is good, you

may want to invest in that relationship.

There is no substitution for

building real-world use cases – specific

examples of how you implement a

given process, how it is administered,

what types of reports will be used

and how it will be configured.

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In other cases you may have been burned by a fast-growing vendor that

did not deliver on their promises (this is not uncommon in this market).

In this case, your organization may have lost its “risk-tolerance” and

may want to do business with a more conservative but perhaps slower-

growing provider who can focus more precisely on your needs.

In our systems research and advisory services we often find that the

biggest driver of success is a meeting of the minds between the buyer and

provider. You must feel comfortable with the vendor’s products today,

their services, their support and their ability to work with you. Remember

that in these architectural decisions, you are not just buying products but

you are also buying companies – and as this market continues to change

rapidly, the products will evolve quickly.

There really is no substitute for a reference. We urge all buyers to look

for two to three references from customers with very similar business

strategies, use cases, organization sizes, and industry and governance

models to your own. Take the time to visit these companies in person, if

possible. As the market for talent management systems is still young,

you do not want to be the “first global solution” for a given vendor,

for example.

Consider the Delivery Model you Prefer

Obviously in today’s world there is a tremendous amount of interest in

software as a service (SaaS) models. Vendors in the SaaS world heavily

push their “multi-tenant architectures,” quality of service, uptime and

other features.

We will not discuss SaaS in detail at this time,6 but it is fair to say that

there are essentially three models for enterprise software today:

1. Licensed, in which you own and manage the software;

2. Hosted, in which you own but someone else manages the

software; and,

3. SaaS, in which you rent the software and it is provided as a service.

6 For more information, SuccessFactors Files for Public Offering: The SaaS Model for Talent Management Grows, Bersin & Associates / Josh Bersin, August 2007. Available to research members at www.elearningresearch.com.

The biggest driver of success is a

meeting of the minds between

the buyer and provider.

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The SaaS model provides many benefits (e.g., regular upgrades, no

need for version and fix management), but it is relatively new for global

implementations – so larger organizations still prefer the licensed model.

The key issues to consider are your needs for data integration,

geographies and domain management, and your financial model. SaaS

software looks like a lease to a CFO, so the financial model for SaaS

software is very different.

The choice of delivery model affects your business case and long-term

financial strategy for the systems. In the case of licensed software, much

of the long-term costs of the system are related to the operational costs

of running, upgrading and maintaining the software.

ModelUpgrades and

FixesCost

Considerations$ Model

Licensed You are responsible for patches and fixes, and likely will install when you have time.

You must purchase the software as a capital investment and budget for implementation, operations, fixes and upgrades.

You own the software and it is yours to maintain.

Hosted “Single-Tenant”

The hosting vendor installs these patches and upgrades whenever you are ready for them.

You typically purchase the software and pay an annual fee for implementation, operations, fixes and upgrades.

You own the software but someone else maintains it and operates it.

On-Demand SaaS

“Multi-Tenant”

The vendor installs these patches and upgrades transparently to you, whenever they want to.

All your fees are monthly or annual and the LMS vendor takes on any cost of hardware, database, fixes and other service.

The vendor provides it to you as a service.

Figure 5: SaaS, Hosted or Licensed Models for Software

Source: Bersin & Associates, 2007.

Key issues to consider are

your needs for data integration,

geographies and domain

management, and your financial

model.

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How to Build a Talent Management Systems Strategy Josh Bersin | Page 1�

Initial Infrastructure

5-20%

Deployment Personnel

5-15%

Ongoing Infrastructure

5-15%

Ongoing Personnel50-85%

• Hardware• Software• Security• Networking• Monitoring

tools• Reporting

tools• Facilities

• Needs analysis• Configuration• Tuning and

testing• Launch• IT staff

training• End-user

training

• Hardware upgrades

• Network security

• Bandwidth• Redundant

systems• Backup

helpdesk

• Scheduled maintenance

• Unscheduled maintenance

• Outage response

• End-user support

• IT staff training and support

• Upgrades and add-ons

• Security monitoring

Figure 6: Cost of Ownership for Licensed Software

Source: Bersin & Associates, 2007.

SetupFees2-5%

Deployment Personnel

3-5%

OngoingCosts

80-90%

Ongoing Personnel

5-10%

• Vendor setup fees

• Application testing

• Integration with other systems

• Configuration• Launch and

end user training

• SaaS subscription fees (typically include implementation, support, upgrades, end-user support, content integration, and other services)

• System administration

• Working with vendor

• End-user support and marketing

Figure 7: Cost of Ownership for SaaS Software

Source: Bersin & Associates, 2007.

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How to Build a Talent Management Systems Strategy Josh Bersin | Page 16

In the case of SaaS models, the costs are more heavily weighted toward

subscription fees.

SaaS vendors tend to serve smaller customers, because most large

companies are still not ready for OnDemand software solutions. As a

result, they often have fewer resources for professional services and more

limited options for systems integration. On the other hand, SaaS vendors

are dependent on happy customers to maintain their subscription fees, so

in many cases they are the most service-oriented vendors in the market.

Our research in the LMS market showed that SaaS vendors had much

higher customer satisfaction scores in the enterprise and mid-market

segment than licensed software vendors, for example.

Consider System to System Integration

Finally, there is the issue of how IT will integrate this system into your

other HR systems. Our research on talent management suites clearly

illustrates that sophisticated talent management systems require

integration between LMS, HRMS, ATS and other systems. Such integration

can be done through the use of web services as well as more traditional

system-to-system integration.

There are also third-party system integrations you may need. For

example, your CRM system may hold all information on sales attainment

for the sales organization. This data will directly impact compensation

and even performance appraisals. In order to connect these systems, you

are likely going to have to build this integration. As of yet, no vendor has

productized CRM integrations to their talent management systems.

Most software vendors use a newer, “service-oriented” architecture,

which enables software developers to reach directly into different

modules of the system to integrate workflow and data. If you believe

this level of integration is necessary, the best solution is to have your

HRIT or IT specialist look at the architecture and programming interfaces

available from the vendors you are interested in. Again, speak with

references who have used such integrations in their own solutions.

SaaS vendors are dependent on

happy customers to maintain their

subscription fees, so in many cases they

are the most service-oriented vendors in

the market.

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How to Build a Talent Management Systems Strategy Josh Bersin | Page 17

Bottom Line: Build a Long-Term Architecture and Plan

The bottom line is – you should build a long-term plan and architecture.

Our research and advisory services are designed to help you:

• Establish a business and talent management strategy;

• Develop use cases;

• Identify a short list of vendors; and,

• Make the final decisions.

These systems are complex, powerful and in a rapid state of flux. While

talent management does not require a systems solution to be effective,

organizations now realize that by building a business-driven systems

strategy you can begin to implement the kind of breakthrough talent

management solutions that break down the traditional barriers of HR.

Buyers must have patience, build a roadmap and implement their

strategy one step at a time. We look forward to your feedback and to

helping you develop these strategies with the support of our research

and advisory services.

Copyright © 2007 Bersin & Associates. All rights reserved. Page 1

Integration Reality

LMSPrograms, Courses, Objects, Assessments

Prices, Fees, Student Hours, Credits, Resources,Certifications, Scores, Completions, Ratings

PerformanceManagement

Goals, Objectives, Performance Plans,Development Plans, Assessments

Reviews, Ratings, Rankings

Employee Profile Data (Demographics, History)

Organizational Data (Relationships, Hierarchy, Geography)Job and Role Descriptions, Open Requisitions

Competency Requirements, Organizational Competencies, Skills

Compensation Data (Current, planned, short / long term)

Lear

ning

Con

tent

Lear

ning

Con

tent Content Management (LCMS)

Content Development Tools

Reporting

Con

tent

Inte

rface

s

Performance Support

Collaboration (Webcast, Discussion, Blog, Wiki)

Portals: Employee | Manager | Customer | Partner

Sourcing & Recruiting

Succession Planning

Career Development

Dat

aA

pplic

atio

nTo

ols

Figure 8: Cost of Ownership for Licensed Software

Source: Bersin & Associates, 2007.