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Dusting off Shadow IT

August 19, 2013

Dust CoverOn Saturday, my Kindle pre-order of Hugh Howey’s “Dust” descended from Amazon’s cloud (natch) to my tingling with anticipation iPad. “Dust” is the last of a trilogy (sort of) chronicling a dystopian society living in subterranean silos protecting all from the “outside.” Inside, a shadowy IT group maintains control over the populace from behind reinforced walls with their own power source…

Hmmm… Shadow IT… A recent techrepublic blog post on the dangers of it got me thinking about it, and reminded me of a piece I wrote a while back. It was for a magazine, but wasn’t used, so I’ll use it here. It’s about how cloud computing usually doesn’t eliminate the need for IT, and how partnering with your internal IT on any cloud project is the best approach. Here you go…

If you’re reading <the name of the magazine that didn’t use my article>, chances are you’ve heard of Kenexa, Taleo, and SuccessFactors. These three companies provide Human Resources Information System (HRIS) software. Oh, and they all deliver that software “as a service” for humans to use at desktop computers, laptops, tablets and other mobile devices via (insert dramatic intro music) the cloud. It’s that combination of HR process automation and cloud computing that led to the acquisition of the trio by IBM, Oracle, and SAP respectively over the last fifteen months, for a combined $6.6 billion dollars. Yes, HR “Software as a Service” (SaaS) is here to stay.

This year on Valentine’s Day, Bloomberg Businessweek blew a big kiss, calling them “a cloud computing king.” With the magazine reporting revenues at $2.8B, and a market cap of $24B, who am I to argue? essentially defined the SaaS and cloud computing market with their Customer Relationship Management (CRM) applications, then expanded to customer service and marketing automation. Their next target market: human resources. By defining the market, Salesforce also influences the message. A quick peek at their “benefits of SaaS” proclaims, “An Internet Connection is all the Infrastructure You Need.”

That’s where you need to be careful.

Salesforce does a great job with the whole customer experience, and while it’s true you don’t need on-premise servers, storage, or a database (think Microsoft SQLServer or Oracle), some marketing of SaaS and cloud computing has tantalized business owners with the idea that they no longer need any support from an Information Technology (IT) department if they opt for a SaaS solution. That can be true for some very small businesses, but if you’re a Small to Mid-Sized Business (SMB) or a larger Enterprise, it’s likely you need IT support. Here are just a few factors to consider as you evaluate your options:

  • Security – Your HRIS will probably store sensitive employee identifiers like Social Security number and date of birth, and perhaps data governed by the Health Insurance Portability and Accountability Act (HIPAA). Do you have a formal process to protect confidential employee data? Also, a SaaS application is outside your protective IT “firewall.” Do you understand the technical protocols to access the application while protecting your internal IT environment?
  • User devices – What desktops, laptops, tablets, and mobile devices will access the application? Are they technically capable of doing so? Will users connect to your HRIS from home or the road? Who will support your users when they have connectivity problems?
  • Systems integration – The HRIS value to your organization can be greatly increased when integrated with other software systems you use, and the richness of workforce analytics data is just one reason why. As you think about possible systems to integrate, consider whether those connections will be SaaS to SaaS, SaaS to on-premise, or SaaS to home grown. IT professionals have more experience with the formal development and test methodologies required to build integrations successfully.
  • Post go-live application management – Who will support your users and manage application changes? Again, IT pros will have the experience and procedural discipline to provide ongoing support and management of application changes.
  • Documentation – This is often overlooked, but it’s critical to formally document your system’s security, connectivity, application configuration, integrations, any custom code, and disaster recovery procedures. Who in your organization has the skills to do this right?
  • Implementation – All of the points above will be part of your implementation, plus the deciphering of your HR business processes the HRIS will automate. Have you run an IT project before? Do you have all the answers or even know all the questions to ask?

In addition to the IT support you need for a SaaS implementation, you should also consider your training requirements. Who needs to be trained and what is the right mix of educational content and delivery methods for the audience? And don’t forget about new hires. You’ll need a plan for them as well.

Of course all of these points need to support clearly defined business objectives from the start. When you invest in automating sophisticated business process like sales, workforce management, or HR, it creates an opportunity for you to differentiate from competitors, and to automate your operational advantages like creative sales comp models, unique time accrual policies, and savvy candidate screening models. Implementing vanilla software makes you vanilla.

The point is that while SaaS offers many advantages to streamline software deployment and use, long-term success and competitive differentiation depend on the teamwork and committed engagement and support of business users and IT professionals. Implementing a HRIS is a significant investment and an opportunity. Make it great.

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