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By many measures, Oracle Corp. leads the market in human capital management software, serving a large base of PeopleSoft users while continuing to develop its newer Oracle Fusion HCM applications and HCM modules in its ERP offering, E-Business Suite.
SearchFinancialApplications talked with Chris Leone, Oracle's senior vice president for applications development, at a roundtable held during the recent Oracle OpenWorld conference. Leone described Oracle Fusion HCM's new reputation management feature, which uses enterprise social networking to track how employees are known to their peers. He also explained how the various product lines fit into the company's new Oracle HCM Cloud brand and reported on progress in integrating its broad portfolio. Also attending was Brian Sommers, a blogger and founder of the research firm Vital Analysis.
Human resources (HR) executives' number one beef right now is they have to hire IT people to work in their HR departments to integrate the different cloud-based applicant tracking systems, recruiting systems, performance management systems, payroll and so forth. They don't have that single book of record. Oracle might have interfaced everything together, but your human capital management (HCM) setup still has pieces of PeopleSoft, little Fusion bolt-on apps to go around it, and then there's a Fusion HCM. It's not a single code set; it's still multiple product lines and add-on pieces.
Chris Leone: That's not our strategy at all. Yes, we do have a PeopleSoft product line, which [is where] I came from back in the day. PeopleSoft has a full suite of core HR, payroll, talent management -- and customers have deployed that and are running that today. In the cloud, we have a full suite of HR, pay, compensation, benefits, core HR solution, including performance and talent review. And then we have some assets from Taleo that are integrated for talent acquisition and learning.
So our strategy is; one, customers can stay on PeopleSoft -- I'll use that as an example -- [for] basically core HR and pay and take advantage of our talent assets. Or, they can transform their business and move their entire HR and talent processes to the cloud. We have 12 customers here that have done that and spoken at the conference. It's customers like Siemens and UBS and Tilly's and American Career College that have moved their entire HR system, including talent management, to the cloud and are running it in a Software as a Service deployment. Or put talent into the cloud, which many of the largest customers in the world have done.
Customers have made very tactical decisions over the last five to seven years [to have] different SaaS [Software as a Service] products. They have a calendar product, an expenses product, a sales force automation product, a learning product -- and they're all different. They have different [service-level agreements] SLAs, back ends and integration technologies. Over time, customers will look to consolidate those. Customers will look at what we offer in the cloud as a business enablement platform and start to consolidate even their cloud assets.
Many of the analysts write about the top 5% or 7% that are trying to move their entire operations to SaaS, [but] there are still 93% of customers that want to run on-premises and want to upgrade to our latest releases and are happy with the capabilities that are coming.
Do you have the full suite in the cloud now?
Leone: Yes. In the cloud, we have core HR. We have benefits, we have compensation, we have payroll -- a subset of payrolls, not all global payrolls; so we have three payrolls available today. We have performance management, we have goals management, we have talent review, we have learning, we have talent acquisition or recruiting and we have onboarding.
Social and BI [business intelligence] are just part of the application. The two applications that are loosely coupled, that have interfaces that we've integrated, are learning and talent acquisition.
Many companies have large deployments. Macy's is a recruiting [and learning] customer. They have 175,000 employees. During their peak season, they hire 80,000 new contactors, basically for the holiday season. They don't want to mix their applicant tracking system data because there's so much volume in the historical information [in] the core HR system. They want us to keep those databases separate and just integrate from a process perspective.
That's our strategy. Look and feel will be the same, we'll synchronize on releases, security will be the same, but we'll keep the applicant tracking system -- because of the volume for many of the largest companies in the world -- separate from the core HR system.
How much integration work do you still have to do, for example, in a hybrid environment where a user has PeopleSoft for core HR on-premises and then goes out to the cloud?
Leone: Today, from an enterprise perspective, Taleo has 800 enterprise customers, meaning customers with over 5,000 employees. At least 25% of them are PeopleSoft back-end customers. What we're doing is packaging up that integration, which means they don't have to build out the extract themselves from PeopleSoft and push it into Taleo recruiting. We're building that extract so it can populate work structures and bring over employee information, and that's going to be delivered by the end of this calendar year.
The war for talent has ramped up again, and HR executives say they are not looking to traditional vendors to provide them with the tools they need. They're talking about products from companies like Entelo, TalentBin, Whitetruffle and Bullhorn Reach, none of which are part of your setup or your competitors' setup right now. Are you guys dreaming up new process models on how this is going to work?
Leone: Taking away nothing from these smaller vendors, there's some innovative stuff that's going on out there, no doubt. The world is changing. How people source candidates this year and last year is completely different than five or 10 years ago [when] it was all about job boards. Three years ago it was all about LinkedIn. Today, it's really about this whole social sourcing concept -- one key area that we offer today. Social sourcing is being able to take advantage of your employees' Facebook, LinkedIn and Twitter [connections].
That's so last Tuesday. These guys are figuring out what are the digital water coolers where people can hang out. They can also score people in your prospect pool the way Marketo or Eloqua would score candidates. You've got that?
Leone: You can call it last Tuesday. We have a lot of customers that are signing up. Some of the largest customers like eBay and Yahoo that are using our social sourcing application.
I'll give you a couple of things that we are doing around reputation and team engagement. One of the things that we're focused on is delivering tools that go beyond the traditional HR tools. In our latest release we have this notion of reputation management that came out in our [Fusion Applications Release 7] press release, where we're looking at a model [to] start to identify reputations of employees within the organization. We start to look at how they're engaging with other employees through the social capabilities that we've built in. You can turn it on with implicit consent from the employee to social channels like Facebook and LinkedIn and what they're talking about. We can build this reputation employee by employee, [and] use it in performance documents [and] compensation plans.
That reputation that people have within the organization, [before Workforce Reputation Management, it was] completely behind the scenes. We all know "Joe" is great at Java coding and helping people get their builds in on time, but it's not something you can build up and have [a mechanism] that measures what your reputation is.
We've introduced a product that not only can look at your reputation from what you're doing collaborating within the organization, it can also reach out into your social connections. I think that's new.
More on Oracle
View a video on the Oracle HCM Cloud strategy
Read about progress in Oracle Taleo integration
There are products out there that I think are pretty cool and pretty innovative, like Stack Overflow, which is a Q&A solution for engineers like my team and myself that goes out and asks technical questions, [such as], what is the best algorithm? People answer those questions, and if it's the right answer, [they] develop a reputation.
This whole concept of what your reputation score is within the enterprise is just starting to be there, so we haven't woven it into all of the talent or performance management processes yet. But we believe it will be important.
We also have it from a sourcing perspective. Part of the reputation score can be in how I source candidates. So we've connected it to LinkedIn and to our talent acquisition candidate pool so you can also start to look at reputation scores of referrals. So now I can see this person was referred by one of my top engineers, and I can use that to weight some of the candidates. We have some customers that are interested.
Have there been changes in Oracle HCM branding?
Leone: We're trying to simplify. We still have the Taleo set of assets [and the] Fusion set of assets. We're trying to simplify customers' understanding of what we have, so we're really going with this HCM Cloud service as the umbrella term, but underneath you'll still see, say, Taleo and Fusion HCM plug into that.
HCM Cloud service is the overarching term, but from a product perspective, when you go the price list, it's still under Taleo [and] Fusion.