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Gartner's HCM Magic

My friends at Gartner – Jim Holincheck and Thomas Otter, just published a shiny, new, detailed analysis of Employee Performance Management technology landscape.  I want to accomplish 2 things with this blog post.  First, I’d like to express immense appreciation to the entire analyst team that was involved in publishing this report.  For those of you who don’t know – it involved months of detailed briefings, then months of detailed analysts, then months of updates and fact checking.  It is a huge undertaking and everyone involved should be thanked for producing what I would consider to be the most influential research report in the HCM industry.  If you are still asking yourself a question of whether decision makers use the Gartner MQ, the answer is yes!  Fortune 500 IT executives still base their short-lists on influential research and HCM isn’t an exception at all.  Download this report for free here, and thank you, SuccessFactors, for buying the distribution rights.

Now that we are done with important acknowledgements, the second thing I’d like to accomplish is to provide my answers to few questions that I know you all have. Here we go…

Why is SuccessFactors a distinct leader in the market?

I am not able to repost any part of the report out of respect to the distribution rights owned by Gartner, but I am able to tell you that SuccessFactors was positioned as a distinct leader in the market.  What does it mean?  This simply means that, according to Gartner, nobody in HCM industry comes close.  I really mean it – nobody was positioned anywhere near the leadership “dot” that belongs to SuccessFactors.  Here is a simple reason why – SuccessFactors has a huge number of customers across all components that belong to employee performance management.  Their position wasn’t effected by the lack of the learning management offering, because it wasn’t a part of the magic quadrant criteria.  Their ability to drive product vision, execute by closing some of the largest deals, all combined with pure SaaS delivery method and healthy recurring revenue stream makes them a leader in Gartner’s mind.  One key differentiator – they can execute.  Notice that many HCM vendors are visionary, but vision isn’t enough.  Closing deals and having happy customers is the key. “Execution is the difference,” reads the famous tagline on SuccessFactors site – they embrace it themselves. All other reasons are truly secondary.  Caution – next Magic Quadrant will include learning and development and SuccessFactors must rush to build an awesome employee development value proposition into their suite.  Components are (almost) there, if they can build an awesome and innovative workflow, they will continue to win.

Why did Taleo move into the Leaders Quadrant? 

Taleo is the single most successful HCM vendor with relatively new employee performance management offering.  They have been able to achieve amazing traction just 3 years after making it public. These reasons aside, I think that Taleo earns the leader placement because Taleo has the most impressive management team in all of HCM technology space. I am not a fan of pointing people out specifically, but when you meet Taleo’s Products and Technology team, it becomes clear that people are the difference at Taleo.  Impressive and thoughtful HCM experts, all of them are aligned exactly on what Taleo will become.  It must feel amazing to partner with this kind of vendor.  Having said that, Taleo needs to move on the vision scale.  Evangelism of social concepts will make a difference for Taleo in the year to come.  Lack of social platform to drive informal components of people management is what most likely held Taleo back on the vision scale.  But let me sum it up – they have the best management team in HCM, they are wildly successful with their new performance offering and they have a plan.  Watch Taleo become SuccessFactors' neighbor next year in the Magic Quadrant that will follow and watch them build all the right, business relevant social components directly into the people management workflow.  This may just end up being a competitive advantage for Taleo, while SuccessFactors figures our how to pull together multiple acquisitions in the social arena.

Where is Workday?

Who was #24 on Wall Street Journal’s list of hottest Startups?  Workday!  Where is Workday in Gartner’s Magic Quadrant?  It isn’t there!  Workday isn’t included because it didn’t meet the inclusion criteria.  Don’t let that distract you, however! They meet the inclusion criteria now and they will appear in the next version of the report.  There are few reasons that I can think of for Workday’s inability to meet inclusion criteria in time.  They may have focused on the core, HRIS and system of record components until now.   Workday, being an ERP, wouldn’t be able to sell a standalone talent management value proposition.  It would be strange for their clients to use Workday Talent Management and Oracle HRIS – this isn’t their goal.  Caution - Workday will make a debut in Gartner’s report soon, but with current lack of social platform and inability to address formal learning management and employee development needs, I am not quite sure where they will land.  I know one thing for sure – one particular star that leads their HCM strategy won’t let them fall behind!

Your thoughts?  Thanks for reading.

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Reader Comments (1)

Wow. #2 on the search engine results list. Looks like you have finally arrived. : ^)

October 6, 2011 | Unregistered CommenterWayne C

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