Vendor Landscape: Talent Acquisition Systems

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McLean & Company evaluated eight competitors in the TAS market, including the following notable performers:

Innovation Award:
Hireology – With its sophisticated built-in interview and selection management tools and job analysis functionality, it is setting a new bar for the market.

The TAS market is flooded with at least 400 rich solutions from recruitment specialists, ERP/HRMS vendors, and talent management suite vendors. The market is competitive and far from being consolidated. Despite faltering economies, the TAS market continues to show healthy growth of 10-12%.

For this Vendor Landscape, McLean & Company focused on those vendors that have a strong market presence and/or reputational presence among small- to mid-sized enterprises.

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Vendor Landscape: Talent Acquisition Systems

  1. 1. Vendor Landscape:Talent Acquisition Systems Find the right solution to automate your requisition-to-hire process *Research Compiled by McLean & Company Talent Acquisition Systems: Vendor Landscape 2011
  2. 2. Executive Summary McLean & Company evaluated eight competitors in the Info-Tech Insight TAS market, including the following notable performers: 1. Evaluating vendors by checking off a Champions: features list doesn’t work anymore: • Taleo – With strong vendor capabilities and unmatched As almost every vendor offers similar functionality, it offers a leading TAS that can deliver benefits to functionality, how they do it becomes the any organization. differentiator. As a result, workflow and • iCIMS – Commitment to SMBs and robust, user-friendly solution usability become key evaluation criteria. makes this an easy vendor to like. • SilkRoad – With its strong product and vendor capabilities, it 2. Recruiters are key end-users, but don’t provides a high quality solution for SMBs. just satisfy their needs in selection: • Kenexa – a pioneer in recruiting solutions, is a stable and Hiring managers will use the TAS too, so committed vendor with a well-rounded product for medium- to ensure it meets their needs. And don’t forget large-sized enterprises. about applicants! View the applicant portal from the applicant’s perspective to ensure it Innovation Award: is visually appealing and easy to use. • Hireology – With its sophisticated built-in interview and selection management tools and job analysis functionality, it is setting a 3. Integrating with a variety of external new bar for the market. sources is crucial, but be wary of costs: Vendors differ in the number of sources with which they integrate, associated costs, and third-party contract requirements. Check all of these factors to avoid surprises.*Research Compiled by McLean & Company 2
  3. 3. Talent Acquisition Vendor Landscape selection/knock-out criteria:Market share, mind share, and market consolidation • The TAS market is flooded with at least 400 rich solutions from recruitment specialists, ERP/HRMS vendors, and talent management suite vendors. The market is competitive and far from being consolidated. Despite faltering economies, the TAS market continues to show healthy growth of 10-12%. • For this Vendor Landscape, McLean & Company focused on those vendors that have a strong market presence and/or reputational presence among small- to mid-sized enterprises. Included in the Vendor Landscape: • Bond International Software. The largest provider of software for recruitment agencies worldwide, Bond is breaking into the corporate recruiting market with their BondTalent solution. • Hireology. The smallest and newest vendor in this evaluation, Hireology is trying to take recruiting to the next level by adding sophisticated assessment tools to traditional TAS features and functions. • iCIMS. The third largest provider in the SaaS TAS market, iCIMS’s mission is to make business easier for the SMB market. • Kenexa. One of the pioneers in the TAS market, Kenexa offers TAS products for complex, global organizations and medium- to large-sized businesses. • Njoyn. A dedicated TAS provider, Njoyn is a major player in the Canadian market with the potential to break into other markets in the near future. • SilkRoad. A recent entrant to the space, SilkRoad markets a single platform that can scale to any size of organization in any industry. • SuccessFactors. Starting as a performance management solution vendor, SuccessFactors offers recruiting modules for large enterprises and SMBs. • Taleo. Focused on recruiting at start-up, Taleo is now the largest provider of SaaS TAS.*Research Compiled by McLean & Company 3
  4. 4. Hireology is the newest vendor – however, its robust tools for interview and selection management are impressive Emerging Player Overview • Relatively new on the market, Hireology is trying to reinvent the Product: Hireology way companies select talent by building an easy to use, intuitive Headquarters: Chicago, IL platform that uses data and analytics to drive hiring decisions. Website: hireology.com Founded: 2010 Presence: Privately-held Strengths • Flexible pricing based on the number of concurrent openings, not the number of users, candidates, or company locations. • SmartRankTM feature to sort candidates based on behavioral fit to job requirements (versus a keyword/semantic matching process). • Guides for interviews and reference checks based on job analysis data can be viewed in the system and printed, if needed. Challenges • As Hireology positions itself as one part applicant tracking system and three parts assessment system, the applicant tracking functionalities are not as advanced as those of other vendors. $1 $1M+ McLean & Company Recommends: Enterprises looking for sophisticated built-in tools to help make better hiring decisions will do well to evaluate Hireology.*Research Compiled by McLean & Company 4
  5. 5. If the organization wants more than basic pre-screening, candidate assessments help make data-driven hiring decisions Making better hiring decisions is about using data to drive that decision. Exemplary Performers 1 Employer branding Viable Performers 2 Advanced candidate assessments 3 Global hiring needs Adequate Performers*Research Compiled by McLean & Company 5
  6. 6. Multilingual capabilities for candidates and system end users is critical for organizations who hire around the globe A variety of languages for the applicant portal, end-user interface, and resume parsing is key. Exemplary Performers 1 Employer branding Viable Performers 2 Advanced candidate assessments 3 Global hiring needs Adequate Performers*Research Compiled by McLean & Company 6
  7. 7. Appendix • Glossary • Vendor Evaluation Methodology • Value Index Ranking Methodology • Product Pricing Scenario & Methodology*Research Compiled by McLean & Company 7
  8. 8. Glossary • Applicant Tracking System: An applicant tracking system (ATS) is a software application that enables the electronic handling of a company’s recruitment needs. An ATS allows an organization to collect and store candidate and job-related data, and track and monitor the progress of candidates through all stages of the hiring process. An ATS can be used to post job openings on a corporate web site or job board, screen resumes, and generate interview requests to potential candidates by e-mail. Other features include pre-screening questions, source tracking and source effectiveness reports, and resume processing tools. Until the late 1990s, these systems were only referred to as an ATS; however, today they are increasingly referred to as Talent Acquisition Systems/Solutions (TAS), E-recruitment Software, or Candidate Management Systems. All of these terms are used interchangeably, and refer to solutions that are designed to automate the requisition-to-hire process. • E-Recruitment: E-Recruitment, also known as online recruitment, is the use of technology to attract and recruit candidates. Companies have moved much of their recruitment process online so as to improve the speed by which job candidates can be matched with vacancies. Using e-recruitment technologies, employers are able to fill posts in a fraction of the time previously possible. • Recruiting Software: Recruiting software a broad term used to refer to software applications (i.e. Talent Acquisition Systems/Solutions) designed to help organizations recruit employees more efficiently. Recruiting software is used by small, medium and large organizations to handle job applications and to manage and screen resumes. Other features may include individual applicant tracking, requisition tracking, automated resume ranking, job posting, pre-screening questions and response tracking, and multilingual capabilities.*Research Compiled by McLean & Company 8
  9. 9. Vendor Evaluation Methodology McLean & Company’s Vendor Landscape market evaluations are a part of a larger program of vendor evaluations which includes Solution Sets that provide both Vendor Landscapes and broader Selection Advice. From the domain experience of our analysts as well as through consultation with our clients, a vendor/product shortlist is established. Product briefings are requested from each of these vendors, asking for information on the company, products, technology, customers, partners, sales models and pricing. Our analysts then score each vendor and product across a variety of categories, on a scale of 0-10 points. The raw scores for each vendor are then normalized to the other vendors’ scores to provide a sufficient degree of separation for a meaningful comparison. These scores are then weighted according to weighting factors that our analysts believe represent the weight that an average client should apply to each criteria. The weighted scores are then averaged for each of two high level categories: vendor score and product score. A plot of these two resulting scores is generated to place vendors in one of four categories: Champion, Innovator, Market Pillar, and Emerging Player. For a more granular category by category comparison, analysts convert the individual scores (absolute, non-normalized) for each vendor/product in each evaluated category to a scale of zero to four whereby exceptional performance receives a score of four and poor performance receives a score of zero. These scores are represented with “Harvey Balls”, ranging from an open circle for a score of zero to a filled in circle for a score of four. Harvey Ball scores are indicative of absolute performance by category but are not an exact correlation to overall performance. Individual scorecards are then sent to the vendors for factual review, and to ensure no information is under embargo. We will make corrections where factual errors exist (e.g. pricing, features, technical specifications). We will consider suggestions concerning benefits, functional quality, value, etc; however, these suggestions must be validated by feedback from our customers. We do not accept changes that are not corroborated by actual client experience or wording changes that are purely part of a vendor’s market messaging or positioning. Any resulting changes to final scores are then made as needed, before publishing the results to Info-Tech clients. Vendor Landscapes are refreshed every 12 to 24 months, depending upon the dynamics of each individual market.*Research Compiled by McLean & Company 9
  10. 10. Value Index Ranking Methodology McLean & Company’s Value Index is part of a larger program of vendor evaluations which includes Solution Sets that provide both Vendor Landscapes and broader Selection Advice. The Value Index is an indexed ranking of value per dollar as determined by the raw scores given to each vendor by analysts. To perform the calculation, Affordability is removed from the Product score and the entire Product category is reweighted to represent the same proportions. The Product and Vendor scores are then summed, and multiplied by the Affordability raw score to come up with Value Score. Vendors are then indexed to the highest performing vendor by dividing their score into that of the highest scorer, resulting in an indexed ranking with a top score of 100 assigned to the leading vendor. The Value Index calculation is then repeated on the raw score of each category against Affordability, creating a series of indexes for Features, Usability, Viability, Strategy and Support, with each being indexed against the highest score in that category. The results for each vendor are displayed in tandem with the average score in each category to provide an idea of over and under performance. The Value Index, where applicable, is refreshed every 12 to 24 months, depending upon the dynamics of each individual market.*Research Compiled by McLean & Company 10
  11. 11. Product Pricing Scenario & Methodology McLean & Company provided each vendor with a common pricing scenario to enable normalized scoring of Affordability, calculation of Value Index rankings, and identification of the appropriate solution pricing tier as displayed on each vendor scorecard. Vendors were asked to provide list costs for TAS software licensing to address the needs of a reference organization described in the pricing scenario. Pricing was based to reflect three full years of service including licensing, support, and maintenance. Additional consulting, deployment, and training services were explicitly out of scope of the pricing request, though vendors were encouraged to highlight any such items included with the base product acquisition. The request for a three year service agreement allowed a three-year total acquisition cost to be calculated for each vendor’s TAS solution. This three-year total acquisition cost is the basis of the solution pricing tier indicated for each vendor. Finally, the vendors’ three-year total acquisition costs were normalized to produce the Affordability raw scores and calculate Value Index ratings for each solution. Key elements of the common pricing scenario provided to TAS vendors included: • A three-site, mid-level clothing manufacturer/retailer with 2,200 employees located at a US West Coast head office facility, a second US East Coast satellite office, and a UK satellite office. Recruiting functions are handled primarily at the US head office by three recruiters, but two HR staff in the UK site manage recruiting for that location. • The firm is interested in a TAS solution that will fully automate applicant tracking, job requisition and posting, applicant management and correspondence, in addition to providing other basic TAS functionality and comprehensive reporting capabilities. They want a system that is flexible, open and adaptable to changing human resources needs across its West Coast, East Coast, and UK offices. • The solution need to support the general IT structure of the organization: ◦ Primarily Microsoft Server infrastructure – file, print, and application servers (other than those listed below) fully virtualized. ◦ Exchange 2010 (2 servers). ◦ Oracle DB on Linux (2 servers at the US West Coast office, and a single server in the UK). ◦ 700 Windows 7 laptops; 1,100 Windows 7 desktops; 100 Mac OSX desktops. ◦ BlackBerry is the standard corporate device (with a single BES server), but iPhone and Android phones are allowed to connect to the network also. ◦ General security infrastructure: Spam protection is handled by a cloud-based service; VPN capabilities provided by single function VPN appliances.*Research Compiled by McLean & Company 11

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