Having attended a few #HR #Tech conferences and seen several start-ups mushrooming over the years I have often wondered how the lay of the land would look in the next few years with ‘survival’ instincts of the founders setting in rather quickly. Whilst everyone claims to be unique and solving a specific set of issues, it seems that the issues themselves are a moving target. Buzzwords like artificial intelligence (AI) data modelling, algorithms, machine learning (ML), natural language processing (NLP) are constantly bandied around confusing the daylights out of CHROs and CEOs. How many have moved out of power point presentations is the million $ question.
The conundrum continues due to several factors kicking in.
Do you truly have a #disruptive idea or are you just building a better mousetrap. One visit to any HR Tech conference and you will see a myriad of solutions around Talent acquisition, Engagement, On-boarding, Learning & development, Assessments, HR bots, HRMS, Wellness and other areas. This makes the job of CHROs very complex as they set out with their shopping bags to buy an eco-system that can drive change and build value for their organizations. Am actually hearing that a new job is being created in the corporate world, ‘HR Tech Manager’, the person who rides the wave of product choices and develops the HRTech strategy. We are also seeing boutique consulting firms emerging with promises of helping companies make the right decision. With the high attrition rate of start-ups these roles will become even more challenging in times to come.
Does your idea have an #innovation roadmap or are we stuck in the success of the present. Given the democratization of technology, no idea remains unique beyond a few months with replicas quickly emerging. In fact some of the emerging competitors may be building a better proposition. Are we ensuring our customers are getting more value as they continue using our platform and not forced to ask us constantly ‘what next’? So, it is about having an innovation roadmap and also innovating rapidly to stay ahead of the curve. Staying ahead on the technology curve is key with concepts like Robotic Process Automation that truly use deep technology to build differentiators.
Does the product have depth to penetrate segments that have scale and can be profitable for the start- up. Rather than address several segments and be something for all, can we be everything for some and create a niche for ourselves? Many of the successful products globally have been micro-service based products for specific segments. This involves very focused single point solutions that are a part of a larger standard workflow. There are significant products in candidate sourcing, interviewing, skills gap assessment, engagement, learning, behavioural benchmarking and data analytics. This works really well in the early stage and can help prepare a foundation for developing adjacencies and related growth. Horizontal plays are no longer attractive with commoditized offerings and resultant slower growth rates.
Is your product Plug n Play and can it add value and therefore get embedded into a larger platform that already has a good customer base. Building a product with components that are useable independently becomes an asset when trying to scale up. This also helps in building significant partnerships that can accelerate the ‘go to market’ effort while building the brand credibility and visibility. I was at a future gazing conference recently wherein one of the global gurus in innovation actually mentioned that disruption often happens at the point of ‘go to market’. And how traditional many companies are in their ‘go to market’ strategy?
All start- ups have a shelf life and very often it is about the founders recognizing that early, clearly and working towards a potential strategic partnership as their niche space gets crowded and commoditized. Not everyone can become a unicorn and it is about recognizing and doing a reality check which is critical. Developing the right alliances early on is key to making that happen.
The good news is that the HR technology market is clearly on the upswing. Over $2 billion of investments were made globally in the market in 2018. The adoption rates have been on the rise across companies and many of them already on the journey are replacing or upgrading their HR technology platform. The focus however has to be on employee experience, adapting to new business processes, and optimizing the cost and effort to deploy. HR Technology platforms have also started to change roles in the HR organization, therefore driving transformation in organizations and structures.
Time will tell which of these start ups will overcome this conundrum and re-write the pages of success.