Hot on the heels of Talent Tech Labs publishing its second Talent Management ecosystem report, UNLEASH digs into the the state of the sector with Senior Research Analyst Rana Fatima.
Talent Management is booming - the sector has seen so much change over the past few years as skills and AI come to the fore.
HR buyers needed support, so HR advisory firm Talent Tech Labs decided to expand from just Talent Acquisition to include Talent Management.
We unpick the data and the trends with the firm's Senior Research Analyst Rana Fatima - you can get even more insights from Talent Tech Labs at UNLEASH World in mid-October.
Since 2014, research and advisory firm Talent Tech Labs has been evaluating thousands of Talent Acquisition solutions.
Not being vendor-funded means that Talent Tech Labs is unbiased and “can stand from a distance” when assessing tools. That’s according to Rana Fatima, Senior Research Analyst at Talent Tech Labs.
This ensures it can focus on “how do we help HR leaders truly discern and make sense of all the loud noise that’s going on in the market” and support them to “apply the most effective tools to help them transform their organizations”, Fatima tells UNLEASH in an exclusive interview.
Then in the 2020s, Talent Tech Labs expanded outside Talent Acquisition to also cover Talent Management – this was in response to “the way we saw the market moving”, adds Fatima.
Therefore, in 2023, Talent Tech Labs decided to create an ecosystem explainer report for the Talent Management space. This mirrors similar well-known Talent Tech Labs reports in the Talent Acquisition space, which are now in their 12th iteration.
Now that Talent Tech Labs has produced its second Talent Management Technology: Ecosystem Explained report, UNLEASH wanted to delve in with Fatima; what are the aims of and the methodology behind the report? What are the trends and exciting vendors in this space? What should HR leaders keep top of mind when choosing talent tech?
This deep dive comes ahead of our UNLEASH World show, 16 to 17 October, where Talent Tech Labs’ Co-Founder and CEO Brian Delle Donne will be speaking.
It’s not too late to grab your pass, and see Delle Donne in action!
For a long time, when it came to Talent Management, organizations were simply asking themselves questions like: “Do we have a performance program? Do we send out a couple of surveys a year? Do we have an LMS? Do we have compulsory learning on there?”
However, now organizations are living in a war for talent, so they need to be doing a lot more.
Rather than ticking off that list, with the war for talent, organizations needed to be doing a lot more. They needed to transform Talent Management from being an administrative function, into something much more strategic that feeds this AI-powered, skills-first future of work.
“We were observing a merging of different ways that organizations were viewing talent,” notes Fatima.
At the same time, there was “an extreme level of innovation” in the Talent Management space. In fact, Fatima refers to it as a “gold rush” because ‘everyone wants a piece of this pie”.
Therefore, “there was an intersection of technology expanding rapidly, and Talent Management and HR professionals internally were forced to learn fast as well”, so HR tech buyers needed guidance and clarity on the proliferation of tech tools in this space.
So, Talent Tech Labs had to “double up the education by understanding the technology out there as well. It really built a case for us to build out this entire line of TM research”.
That’s precisely what the advisory firm did. It decided to emulate its Talent Acquisition explainer repot, and analyzed 2,000 companies in the Talent Management space, and narrowing it down to 350 based on three criteria: maturity, innovation and impact.
Talent Tech Labs then created a map of the ecosystem, which becomes a taxonomy for these tech tools to sit within.
It is way for HR leaders to think about the landscape, but Fatima is clear “it is not a checklist”; HR leaders do not have to buy all of these tools to drive Talent Management success.
For the 2024 report, the second edition for Talent Management, the taxonomy was divided into four stages: Engage, Evaluate, Develop and Manage.
These stages are then divided into multiple verticals and sub-verticals, whether that’s employee experience, total rewards, internal mobility, learning and development or HCM suites for instance.
Given that this is the second edition of the Talent Management report, UNLEASH was keen to find out what are the big trends facing the Talent Management tech space? How has the sector evolved between the 2023 and 2024 reports?
An interesting finding in the report was “really seeing how vendors are evolving to respond to this Talent Management gold rush”. Even big tech companies, like Google and Microsoft, are getting involved.
The context is that legacy tools had stagnated, “they weren’t really innovating fast enough”. This created space for pure play tools to come in and disrupt the Talent Management space.
This led to saturation of the market, and forced tools to consolidate by building or buying.
This explains why there have been lots of acquisitions of smaller companies, as well as significant product development where companies had to diversify their offerings.
From a buyer perspective, “a company couldn’t buy 17 different tools”, so “these major tools are now becoming all-in-on tools,” notes Fatima.
This response to the “gold rush” was a surprise for Fatima.
The 2023 report had been very difficult to produce – “we were literally trying to boil the ocean” – but with this consolidation, “it actually boiled down a little on its own”, she tells UNLEASH.
Another major trend is, of course, the HR topic of the moment, AI. Generative AI has been a fundamental leap in technical capabilities; for Talent Tech Labs, this represents a new “frontier of possibility” to reimagine HR.
Vendors are on board and developing various gen AI functionalities at “breakneck pace”.
UNLEASH asked Talent Tech Labs’ Fatima to pull out some vendors that really exemplify these trends.
One she noted was Lattice – “they did performance really well in a really innovative manner, then they were just forced by the market to be so much more. They’ve included learning, compensation, analytics, and they’re going to be rolling out HRIS and payroll”.
This was one of the reasons why Talent Tech Labs includes HRIS and HCM suits in the Talent Management ecosystem – “in the past, there wasn’t enough innovation happening there, but now, we’re forced to open it up”, Fatima adds.
Lattice has had a big year for executive appointments – with a new CEO and CPO being announced. Their customers include Discord, Loom, Udacity, Intercom and Gusto.
Another example is Glean, which brings AI to the internal wiki.
Previously, it was very hard to find anything on company intranets, but now Glean helps employees search and quickly find out answers.
Customers like Grammarly, Reddit, Duolingo, Pinterest and Databricks are already putting Glean’s AI to work.
Finally, TechWolf is a standout tool for Fatima. “The recent raise of $43 million with SAP, ServiceNow and Workday being on their investor table is worth calling out”.
Plus, customers like HSBC, GSK, Ericsson and United Airlines are using TechWolf’s technology to identify employees’ existing skills, and anticipate future skills demands.
For Fatima, “they do it in a different way to anyone else”, and they minimize the work for employees and employers in the process.
Want to gain further insights on the Talent technology markets?
You’re in luck – Talent Tech Labs’ Co-Founder and CEO Brian Delle Donne is going to speaking at UNLEASH World in Paris.
On Thursday 17th October, Delle Donne will be moderating a panel of HR leaders from Mastercard, Synopsys and ensure all about how to modernize talent functions.
For Fatima, this panel will see Delle Donne “probe the panelists, not only on the tech, but the surrounding conditions to facilitate successful adoption”.
“Just because something new is coming out on the market, doesn’t necessarily mean you have to buy it” – this type of panel will help HR leaders to really learn and understand “how these big organizations actually assess the technology” to ensure it’s the right fit.
It’s not too late to join us in Paris – you can grab a pass here.
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Chief Reporter
Allie is an award-winning business journalist and can be reached at alexandra@unleash.ai.
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