Firms Planning to Increase Spending on HR Tech

Companies are planning to boost their spending on HR technology in the next year, according to a recent survey.

Roughly a third of companies polled in a survey from human resources research firm Towers Watson & Co. said they plan to increase their investment in HR technology, with advances in mobile and manager self-service tools propelling the trend.

About 23 percent of the companies surveyed said they plan to increase their investments by as much as 20 percent. Just 15 percent of companies said they plan to spend less on HR technology in the coming year.

Towers Watson’s annual HR Service Delivery and Technology Survey polled 1,048 companies in March. Respondents included human resources and IT executives from 45 countries. Two-thirds of respondents were from organizations with more than 5,000 employees.

“The hypothesis is that we’re seeing more organizations having tech that’s out of date, that have not made subs upgrades in the last few years, and are making those changes now,” said Mike DiClaudio, global leader of Tower Watson’s HR service delivery practice who oversaw the study, which was released June 9.

Systems controlling process payroll and other data points regarding HR are among the systems most likely to be updated, DiClaudio said. “We’re seeing HR technologies make the workplace seem more like a consumer marketplace,” he said. “If I want to transfer someone, it should be as easy as buying a book on Amazon.”

The study also found an increase in adoption of mobile HR technology. Nearly half of the respondents said they use mobile for HR transactions, a 10 percent increase from 2013. Additionally, 60 percent of employers surveyed said they have an HR portal in place, up from 53 percent in 2013. Roughly 20 percent of those surveyed said they are in the process of developing an HR portal.

Companies are also planning to increase their use of manager self-service tools, according to the survey. About 71 percent of North American companies are using manager self-service tools, compared with 61 percent last year.

Nearly two-thirds of companies (63 percent) regularly perform engagement surveys. Moreover, those that conduct these surveys benefit twice as much when it comes to implementing new HR technology as those that don’t.

“The belief for that is because you start to understand what employees want and how they process change,” DiClaudio said. “It can tell you key drivers for employee behaviors, so you can use them to manage change. Using employee engagement data to inform multiple initiatives in my organization, including technology implementations, is the best practice.”

Luke Siuty is an editorial intern for Talent Management. He can be reached at