2025 – The year of HCM reinvention

As I write my final post of the year I want to look forward to an exciting 2025. I will still have the opportunity to look back at 2024 with my friends Davis and Prateek. We will record in early January a 2024 predictions review podcast that we had to postpone from end of 2024 to beginning 2025 – it is always tight towards the end of year. But maybe we will have even fresher minds after some time off. At least this is what happens to me always – these two weeks between Christmas and the new work year to start is the best time to really recharge and restart as most of the business is also having a pause and let you have uninterrupted time off. 

2024 – the year AI went mainstream

But let’s look at this special time “in between the years” ahead to 2025 with the knowledge of 2024. I think we all can agree that 2024 was an even bigger year on AI than the year before. It was the year that we went from test & learn, from pilots to see true solutions in our well known HCM suites and products. I do not recall any HR tech solution that had not added a Gen AI feature. And of course, we saw some very interesting AI first solutions in the HR space as well. Towards the end of this year I had the pleasure to share the stage with Athene Karp, founder of HiredScore which is one of these AI first solutions – very much focused on Talent Acquisition, which is today and probably will continue to be the most invested space in HR. 

Where is the next step

We all know though that there is more to HR than TA, and this is what I am looking forward to. We have accumulated such a phenomenal digital arsenal of new technological opportunities, tools and ideas in the recent years, but we have not done really anything with it. Or at least I haven’t really seen it. What I have seen is many ideas on how AI or Gen AI can change our current processes, or how (Gen) AI can be utilized to simplify user interfaces – who does not have a Gen AI powered chatbot in their arsenal now? But where is the next step? Where is the next big thing? Where is true creativity? – some 20+ years ago when SuccessFactors was founded, when Workday was founded. These two companies (yes, and some others that we lost on the way) have taken advantage of the big new opportunities in technology at the beginning of this century and revolutionized HR tech. Today the HCM Cloud world is dominated by these two and other progressive cloud vendors like Microsoft and Oracle. And I bet all of you know all of these inside and out. And yes, they have done a great job, but their level of innovation today is more evolutionary than revolutionary – of course, because they need to keep their current user-base happy and require backwards compatibility. 

And yes, there are also solutions that claim to be different like HiBob or ADP Vantage or others. But are they really different and innovative? Are they reimagining the landscape? I leave you to judge for yourselves. My personal view is that these are just different interpretations of the same old processes and workflows in a new outfit and with some bling bling. 

2025 – the year of HCM reimagination

And this is where my hope for 2025 comes in. The door is wide open, as open as it has never been since the 2000s for a new idea, a reimagination of how HCM could be and look like. The opportunities we have in today’s technology world, the cloud power, AI and Gen AI, the new found understanding of what really matters and what HR needs to be and do for a successful business, the new focus of HCM solutions away from HR and to the majority of its users, away from automating HR to eliminating headaches and obstacles for the enterprise. 

When I think about HCM solutions, I have two metaphors in my mind to get near to what I imagine. 

hrOS – HCM is your Enterprises Operating System

The first and foremost one is to imagining your HCM system as the underlying operating system for your enterprise. I think we are all very clear that without an HCM system your company would not be able to run – like no computer would be able to run without an underlying Operating System (OS). But when was the last time you were actively thinking of your Computer’s OS? I bet you daily fight with Excel, PowerPoint, Outlook, Gmail, and many others, but your OS is just present and enables the others, enables you to get your work done – quietly and (debatable, yes) reliably. It is in the background, taking care of everything that is needed for you to run your other applications on it. ChromeOS from Google is the most focused version of it – it just enables Apps to run on a cloud based system.

HCM systems today are everything but that. Most of them want to be (or are) “in your face”, require you to interact with them and learn their language – but even more: They push you to utilize their “applications” (meaning processes and workflows) vs. what you want or need to do. You want to hire someone? No, you cannot just “do” that, but first you have to know if you have a position that can be used for your recruiting, have to answer a million more questions and then sometime later you can actually start talking about what person you are looking for. Just imagine your Windows would first ask you to choose the background-image for your email, then ask you about the language you want to write your email in, what country you want to send it to – and only once you have answered these questions, Outlook opens and you can start writing your email. We accept that (somehow) in HR, but would never in our daily business life. 

Or imagine this: You are opening your HCM application and you get a push notification that you should write and send a kudo message to one of your employees that has just finished a project. And only once you have interacted with that demand you can get done what you came for…would you accept that before you can start with your Excel sheet to calculate the business case for your next project Excel pushes in your face a message that you haven’t updated your team absence overview for some time and should do that first? Who would accept this?

What we need and hope we get in 2025 is hrOS – a reimagined HR Operating System for the modern, digital enterprise. A system that ensures that all your required HR processes and workflows that enable your business to run are taken care of: In the background, quietly, no user interaction needed. Best no one except the folks that need to manage it know that it is actually present. The best technologies are the ones no one knows the name of or knows that they exist, because that means they don’t get in the way, but just work. 

WYSIWYG

And the 2nd metaphor is WYSIWIG. Who remembers this still? WYSIWYG – What You See Is What You Get revolutionized so much in the web in the late 90s. It opened it up for amateurs like me to design cool looking websites with sophisticated functionality just by dragging & dropping with a visual interface that was easy to understand and let me just drag & drop my webpage, blog or whatever and then took care of ALL the complex programming and coding in the background. If you did not want to, you never had to see it.

I am not saying that we need that same visual interface and dragging & dropping in HR, but WYSIWYG is more than this and should be the approach for everything of the hrOS that require separate applications you want to interact with to e.g. hire someone, promote someone, develop someone. 

For the applications you want to run as an end-user you need a simple way to do that. WYSIWYG is a nice approach you can utilize to get to such an end-user centric focus. Let the end-user decide what they want to do and how they want to do it – don’t be in their way or be a know-it-all.

And again, in 2025 we have all these great new technological opportunities and with a bit of creativity the first hrOS could be developed and should be developed to dominate the coming 20 years of HCM. What do you think about hrOS? Let me know your thoughts. – Or are you already in the process of building it? Connect with me to talk about it more.

Volker Schrank Avatar

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5 responses to “2025 – The year of HCM reinvention”

  1. rolandschoech Avatar
    rolandschoech

    Love the thoughts! In reflection, I think that each business function could claim to have their Enterprise OS. What would a company be without sales, finance, manufacturing, supply chain? None of this happens without people first!

    1. Volker Schrank Avatar

      Thank you Roland for sharing your thoughts. Absolutely. Nothing happens without people first.

  2. Christopher Koch Avatar
    Christopher Koch

    Thank you for your reflection on the current state of technology within HR. It was a pleasure to meet and speak with you at the Phenom CAB summit in December. I love the idea of an HR-OS (HR Operating System). I find that many (not all) vendors in this space are doing the exact opposite. They are looking for a flash in the pan moment, worried about missing the boat with Gen AI. My belief is that Gen AI is a great tool, but it’s limited in what it can do. The space is already cluttered, and what’s happening is professionals are using it to create content while others are then using AI to summarize the content. It’s going to be a vicious cycle! That’s why I love the idea of a quiet, seamless and behind the scenes HR operating system, fully integrated within the org tech stack!

    1. Volker Schrank Avatar

      Thank you Christopher for your feedback and sharing your thoughts. Could not agree more. I am quite certain that we will see such solutions entering the market slowly, but they will come.
      Was a pleasure to meet you, too and hope to stay in touch

  3. Tom Holz Avatar
    Tom Holz

    Great reflections Volker. I like your thought process for sure. I believe that the future Cloud HCM solution needs to be as automated as possible (tasks that can be done or suggested without manual work should be), it needs to be everywhere (available in the flow of work or messaged as you note above as a friendly reminder) & it needs to be configurable or extendable 😉so that truly unique, secret sauce business cases can be managed & used as differentiator’s. There will of course be things we are not thinking of that will be innovative but these are the broad categories that come to mind for me. Keep doing great work out there!

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