WHITE PAPER

Key HR Technology Trends in 2010

Enabling HR to Develop Talent Management Strategies to
Align the Workforce to Business Goals

In the current economy, the last thing in the world businesses can afford is to waste talent, or be
surpassed by competitors that manage their talent better. Human Resources (HR) professionals
are hard pressed to keep up with constant waves of change — from emerging technologies and
shifting market priorities to high turnover rates, low employee morale, and stronger requirements
for alignment with business objectives.

To be effective consultants to lines of business and upper management, HR professionals need

to take advantage of newly developing technologies that help improve communications,
streamline processes, align the workforce to business goals, and drive a performance-driven
business culture. HR needs to show that it can identify workforce trends in a more predictive
manner, target organizational capability gaps, and enhance connections to build alignment with
the business needs. HR professionals need to be well armed with the benefits of these
technologies in order to champion strategic talent development initiatives.
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This paper describes the six most important new technologies in 2010 that HR needs to be ready
to adopt for strategic talent development:

< Mobile: Providing anytime, anywhere access to learning, assessments, and transactions with
mobile devices
< HR analytics: Owning the organization’s strategic business intelligence, with metrics tied to
profitability, for consulting with lines of business and management
< Social learning: Identifying expertise and sharing knowledge to nurture communities of best
practices
< Continuous feedback: Gathering valuable ad-hoc reviews for better employee evaluations
and greater visibility into workforce productivity
< Employee portal: Owning the portal to enable employees to interact with all relevant data and
workflows from disparate HR applications
< Talent management as a platform: Unifying and extending HR processes to drive a high-
performance culture

Mobile: Providing Access Anytime and Anywhere

With smart phones now ubiquitous, HR is expected to respond with anytime, anywhere access to
employee information. On-the-move workers want to consume information and instruction when
and where it suits them, and maximize down time by using their mobile devices. Many traveling
workers now rely more on mobile devices than on laptops.

HR can increase its relevance to a company’s bottom line by showing employees how they can do
their jobs better and easier while on-the-go. Mobile apps can also enable HR to increase
transactional capabilities such as approving an expense report, or push analytics to a mobile
device for faster decision-making.

The portability of on-demand learning on a mobile device enables the workforce to take training,
approve requests, and give feedback. For example, an employee at the airport 30 minutes early for
a flight could log in, check to see if mandatory training has been assigned, launch the course, and
pass the assessment, with time to spare before boarding the flight. The employee’s training plan
would be updated real time.

As critical mass develops over time for location-based mobile blogging and networking with
devices that offer GPS, trainers and instructional designers can create innovative geo-integrated
learning simulations based on the location of the learner, or programs in which instructors can track
learners in real-world locations and supply relevant learning content asynchronously.

HR Analytics: Owning the Strategic Business Intelligence

HR has typically acted as a provider of talent management information to lines of business and
executives, but now, by correlating data from multiple sources, HR can act proactively as a
consultant to executives and business lines on ways of utilizing and developing talent to increase
profitability.

By aligning HR’s tactical metrics to business goals and profitability — for example, measuring
“total spend per employee” and “goal alignment with financial targets” by pulling in the company’s
expense and profitability metrics — HR can move forward towards owning the strategic business
intelligence and driving the convergence of analytics tools across the company.

To prove its value as a proactive consultant, HR needs to determine what analytics the business
needs and develop measurements to capture that data. HR needs to strive to provide talent
intelligence that measures the critical business areas where people can drive performance.

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Typical key performance indicators (KPIs) measure quality of work, teamwork, cooperation, and
skills at problem solving. But the key HR KPIs for strategic business intelligence not only
encompass productivity over time but also tie into production, profitability, and expense metrics as
well as company goals. HR needs to pull in profitability, expense, and production metrics to show,
for example, the precise effects of raising or lowering the employee count to the bottom line.

For example, an HR professional can create a dashboard leveraging KPIs around employee
productivity, time-to-hire, turnover by business unit, and manager performance, and then present
highlights of the areas with positive results while also calling out talent development action plans
for apparent gaps and negative results.

If HR can help grow, retain, and drive employee engagement, it will ultimately improve productivity
and quality in the organization and make a direct impact on the company’s bottom line. HR can
then justify human capital initiatives to upper management to help grow this bottom line.

In addition, HR can now make use of predictive analytics for next-generation success planning in
helping corporations make decisions around hiring effectiveness, predicting the success of
employees, and deciding whom to lay off. Imagine HR being able to predict which new hire has
the highest probability of turning out to be a top performer, and then using the organization’s
resources to nurture that talent. In predictive analytics, advanced algorithms process historical
data, “learn” what has happened in the past, and create models that can be applied to make
judgements about current or future cases.

While predictive analytics may reveal new insights that can drive far-reaching, strategic decisions
by senior management and deliver step changes in business value, it is more common to see
these insights applied at the level of individual cases — enhancing key business decisions that
are made frequently and repeatedly. Closing the loop – tracking the outcomes of these repeated
decisions driven by predictive models, and capturing data at every interaction – guarantees that
the quality and consistency of critical business decisions improves over time and that effective
decisions continue to be made as situations change and evolve.

Social Learning: Identifying Expertise and

Sharing Knowledge
Social learning initiatives that accelerate knowledge sharing and problem-solving can also help
HR identify the key knowledge brokers in the organization. These are the people who know a lot
more about their jobs than others. Even if the key knowledge brokers are several levels down in
the organization, a company that loses them may lose a lot of revenue tied to their knowledge.

Some of the most useful knowledge in an enterprise is spread tacitly — face to face or through
emails — rather than formally through training or knowledge transfer. HR can be more successful
in mining this knowledge by providing the social tools that enable sharing, collaboration, and
tracking. Social learning can be collaborative, immediate, relevant, and presented in the context
of an individual’s unique work environment. It can include the informal learning that occurs as the
result of employees’ making sense of experiences they encounter during their daily work. Even in
large organizations, they learn through their participation in more specific communities made up
of people with whom they interact on a regular basis.

With social tools, knowledge brokers can be gathered into “communities of best practices” that
focus on employee growth and recognition, and team exploration. These communities can be a
company’s most versatile and dynamic knowledge resource. Communities of practice arise as
people address recurring sets of problems together. People who work in cross-functional teams
often form communities of practice to keep in touch with their peers in various parts of the
company and maintain their expertise. When communities of practice cut across business units,
they can develop strategic perspectives that transcend the fragmentation of product lines.

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For example, formal training can walk a new sales rep through the product information the new
rep needs to know, but to be truly immersed in knowledge about the product, the new rep can
read profiles of product experts across the organization, access documents uploaded by subject
matter experts, and join deep discussions in a community of best practices about selling and
implementing the products. This early immersion in product knowledge from across the
organization can prepare new rep to engage in opportunities weeks in advance of colleagues who
took only the formal training.

However, there is no knowledge to share unless employees contribute. For social learning to be
effective, HR needs to develop and nurture these communities by providing access to informal
learning and social tools for generating, uploading, and updating their own content. By analyzing
who contributes to a social learning environment, HR can then identify the people who actually
drive the business and produce the knowledge for the workforce. Creating a solid plan for the
continuous improvement and advancement of these key employees is a vital part of an
organization’s long-term success.

Continuous Feedback: Gathering Valuable Ad-hoc

Reviews
HR is moving toward the goal of incorporating performance feedback into the daily work of an
employee and nurturing personal development. But the reality is that most employees receive
feedback only once a year, and these reviews typically don’t include ad-hoc feedback from project
collaborators and cross-departmental team members who are not direct managers. Annual
performance reviews can be stressful, time-consuming, and often closed to other inputs that
might have provided a more balanced view of the entire year’s work. They can also be ineffective
in delivering the kind of meaningful feedback that workers can use to improve their productivity
and alignment with business goals on an ongoing basis.

Feedback is most effective if it is gathered from a wider range of co-workers continuously so that
it helps the employee prepare for the next task. With continuous feedback, employees can see
and track their progress toward goals and make adjustments if necessary to reach those goals.
Employees and managers can bring together ad-hoc feedback from others in the organization —
from project managers and direct reports to peers and subordinates — to compile a better
evaluation for the employee’s annual review. And HR can gain more valuable insight with this type
of holistic review process that offers greater visibility workforce productivity.

To enable continuous feedback from team members and collaborators, HR is beginning to deploy
project-based review processes that capture ongoing performance feedback on temporary
engagement teams managed by different people. Project-based reviews are also useful for
capturing feedback in matrix reporting environments in which a career manager and several
project managers oversee an employee’s work at different times.

For example, a senior architect working on different side projects can get continuous feedback on
completed tasks in each project, and adjust work if necessary to meet the goals of these projects.
And, when reporting to the direct manager during the annual review, the architect can include
feedback from the different project leads and team members. Even though the manager has
limited exposure to the architect’s activities, the architect is truly evaluated on all activities, not just
those attributed to the architect’s official role.

To be effective, continuous performance feedback needs to be provided often and objectively

without disrupting day-to-day business, and made part of the workplace culture so that it comes
from all employee connections — managers, executives, and peers. It is most effective when
employees are aware of and tracking to business goals, and have the ability to adjust on the fly,
grow faster and uncover development opportunities. Employees can drive their own careers, and
HR can more accurately gauge the pulse of the organization at the employee level.

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Employee Portal: Interacting with HR Workflows

With disparate applications for activities such as learning, goal management, knowledge
management, benefits, payroll, and expense management, HR can now make a sound business
case for deploying an employee portal (or owning or playing a larger role in managing an existing
portal) that enables employees to interact with all relevant data and workflows from these HR
applications.

HR can use the employee portal to automate administrative tasks, simplify communication, and
capture important information electronically. HR can work with IT to integrate all key data points
between the disparate applications, and develop a new user interface on top, giving employees
one point of access for all relevant tasks.

An HR-managed employee portal can help match employees with development opportunities and
significantly improve workforce management. It should offer access to all HR functions as well as
be the knowledge repository for employees. But a portal can also be a two-way highway
transmitting personalized information to individual employees and enabling employees, in turn, to
make requests of the back-end system and connect to embedded workflows. This collaboration
channel can drive two-way conversations that can significantly reduce the number of calls to HR.

The portal can host communities of best practices for social learning, and continuous feedback
modules for tracking towards goals. And consider how productive employees can be if they can
use the portal to check company email, watch a news video, or take a training course from home.
People working on a common project can chat and post memos and comments that are all
available to the entire group. With these capabilities, the employee portal becomes the workplace
— the place where all work can be coordinated, all messages communicated, and all
development opportunities made available for use anytime, anywhere.

Talent Management as a Platform: Unifying and

Extending HR Processes
HR faces a significant challenge in supporting integrated talent management initiatives across
existing applications and systems in order to present unified processes and workflows (such as in
portals described previously). Organizations typically have multiple, disparate applications for
these processes and workflows, with different interfaces, inconsistent data, and a lack of
benchmarks and tools — all of which make integration difficult.

Nevertheless, the solutions for learning, performance, and compensation management increase
in value as they are integrated into a talent management platform. It is now possible to not only
use a suite of integrated learning, performance, and compensation components, but also to
extend their functionality into the user interfaces of existing applications and systems. Workflows
and processes can be pulled into HR applications and desktop applications such as Outlook or
SharePoint, accessed by mobile devices, presented as “widgets” in portals, and integrated with
corporate systems.

Widgets — interactive micro-applications that can be easily embedded in a portal, blog site, or
Web page — reduce the need to use different applications or integrate them. For example, HR
can use widgets to embed analytics and workflows from different applications into a portal or Web
page so they can be shared easily without being tied directly to specific applications. Once the
widget is in place, employees can complete key talent management tasks within the portal, such
as training registration, workflow approvals, performance feedback, and goal management.

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With a talent management platform, employees see a unified system that gives them a
way to create their performance and development plans online. Employees can move
seamlessly from one application to the other, no matter where they start, creating and
checking their goals and picking strategic learning that fills any gaps in their
performance.

HR can champion a talent management platform because it can now be done without
having to replace existing applications and tools of choice. By leveraging data and
converging analytics across the enterprise, and extending processes and workflows to
portals and other applications, HR can use a talent management platform as an engine
to drive a high-performance culture. In addition to supporting the strategic HR processes
in place today, the talent management platform can enable workforce planning, career
management, succession planning and total rewards management – all of which require
integrated talent information.

There might be no greater benefit than the creation of a high-performance work culture.
Consider this the utopia of talent management, where employees are driven, engaged,
skilled, fairly compensated, and successful. Everyone is either in the right role and
succeeding at it, or on a clear path to get there. Workers unite as a team in shared
values and productive behaviors. And the business as a whole is thriving, growing, and
improving because of this environment. A highly productive workforce, after all, breeds a
high-performing business.

About SumTotal
SumTotal Systems, Inc. is a leading provider of proven talent development solutions that
automate and integrate learning, performance, and compensation management to drive
business results on a daily basis. Our solutions strengthen and develop employee skills
to accelerate time-to-market, close skill gaps, and reduce the risk of business
disruptions. With more than 1,500 customers and 18 million users worldwide, we have
increased performance at some of the world's best-known companies, organizations,
and government agencies. Our category leadership and applied insight help us
understand the critical success factors for businesses of all sizes.

For more information

For more information please call +1-650-934-9500 or toll free at 1-866-SMTOTAL, or visit
us on the Web at www.sumtotalsystems.com.

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© 2010, SumTotal Systems, Inc. All rights reserved. SumTotal, the SumTotal logo, ResultsOnDemand, and ToolBook are registered trademarks or trademarks of
SumTotal Systems, Inc. and/or its affiliates in the United States and/or other countries. Other names may be trademarks of their respective owners. May 2010.