I recently praised Salesforce for having the smarts to not get into enterprise resource planning several years ago. It was a good decision, I thought, because there was no upside for them to invade such a well-established market — better for them to focus on a blue ocean strategy in which they went after new applications.
I think the market’s evolution has proven the wisdom of that approach, but now we need to deal with human resources and why Salesforce is going after that market. Shouldn’t the reason for not going after ERP apply to HR too? Well, not really.
Growing Up Together
The company last week announced Salesforce for HR, a feature set that reuses some existing social and mobile functions to create HR apps that leverage those technologies to deliver a new HR experience. Was that wise? How does it play overall? Wise? Yes. Overall, let’s see.
HR usually has been associated with ERP not because it is some derivative of production, but because it was one of the earliest nonaccounting apps that also happened to need computing resources.
Back then, the surest way to get resources was to piggyback onto accounting’s mainframe; it also didn’t hurt that payroll — an inherently HR-oriented app — needed access to the GL. There’s nothing intrinsically back-office-ish about HR — it’s considered part of ERP just because that’s the way things grew up.
Today, everything’s different. HR, that most portable of departments, is finding that its apps have more in common with the social and mobile aspirations of employees than ever, and those aspirations are decidedly front-office-oriented.
System of Engagement
In the manufacturing era, employees were as interchangeable as the parts of the goods produced, but in this service era, when product experiences and solutions are personalized, people expect the same level of granularity in how they are treated as employees as when they enter the market as customers.
To continue the customer metaphor, employees have become accustomed to managing their interactions with vendors, so it’s no surprise that they might want more control when managing their careers.
That’s why Salesforce has reimagined HR not as a system of record — records are still needed, but other ecosystem providers have that angle covered — but as a system of engagement.
Journeys and communities make up an important part of the Salesforce offering, because the company sees the importance of asking the constituent what matters — whether customer or employee — and then having pre-thought-out solutions to address each employee moment of truth.
Make Someone Happy
I’ve been writing a lot about moments of truth lately, and HR might be the better app to look at to see how moments of truth work. The old metaphor for HR was the employee file or record. The new one is the journey. Records are static, past tense, while journeys are evolving and very much in the moment.
There is a limited number of organizational activities for an employee to take part in, and Salesforce for HR gives the HR manager ways to be present and active for them, whether in hiring and firing, or charting the course of a career and providing useful feedback.
Nobody invests in such a system unless there’s an upside of profitability, and there is one here, though it might take time to develop some data. To continue the CRM metaphor, the strong message we see in CRM today is that customers don’t want to be constrained by the same old walled gardens. They want to be valued — and vendors are discovering ways to do that by being present during moments of truth.
The same applies for HR. A generation ago — and maybe just a couple of years ago — having a job was all that mattered, but in better and more consistent economic times, employee mobility can be a problem. Making employees feel valued, as a subtle way of keeping them, makes a lot of sense.
I recently became aware of the Poachable Top 40, a list of companies maintained by Poachable, a company that specializes in helping passive job-seekers find new employment. What’s a passive job-seeker? Someone with talent and brains and a skillset that’s in demand.
The list is made up of companies that people would jump ship to work for, even though they’re pretty happy at the moment and not really looking. Think of it as your fairy godmother looking out for your next job.
In an environment where talent is in high demand, it makes sense to do everything you can to retain employees. Making them feel valued won’t do it alone, but you’d be hard pressed to say it’s not important.
BTW, guess what company just moved into the top 10?