I just returned from the HR Tech conference in Vegas last week. It was amazing. I spent 3 days wandering through the exhibit hall filled with huge players like Oracle, Microsoft, Google, IBM, ADP, and industry standards including Cornerstone, Indeed, SAP, and Monster. All the ATS were there. And like always there were a ton of startups hawking new innovations in payroll, benefits, job boards, AI, candidate selection machine learning, and more more. This was by far the biggest and most exiting HR Tech I’ve attended.
What was the common theme with all these exhibitors? Mobile. It was literally everywhere. Almost every vendor was showcasing their services on a mobile device. The message: “The future is mobile, get ready for it.” I was blown away with how far the user experience has come. There was so many cool ways mobile was being used to automate just about every process. I saw huge demos being conducted in every other booth filled with potential clients getting a look at all these new and exciting services delivered through a mobile experience and they were eating it up.
Why is this. It’s simple. We are in the tightest job market where everyone is fighting for talent, and younger job seekers are on their phones all day. They use text and they don’t use email. If you want their attention, you have to text them and then provide an experience that makes it easy and effortless to apply for a job. The statistics are overwhelming. HR technology companies get this. From Oracle, Microsoft, to ADP and Cornerstone, to the smallest players providing niche services, they are capitalizing on mobile big time.
And then there were all the background check companies. The main 7 were there as well as a sprinkling of smaller ones and even three startups.
But what struck me was not one CRA, except the startups were showcasing their technology, much less mobile. In fact, nothing in their marketing messages spoke to anything other than what they’ve been saying for 15 years. Speed, Accuracy, Compliance, Services, Support, Global, same old, same old… The funny thing is while all these HR facing companies where showcasing their technology on mobile, the largest background check companies were using gimmicks to attract attendees. I saw everything from a magician, airbnb vacation giveaways to carnival games. It was actually kinda bizarre. Why were they not showing their frontend technology and mobile if they had it. It was after all, a TECHNOLOGY CONFERENCE!
I came up with three possible reasons.
(1) HR Tech is not the main HR show. It’s SHRM and it is true they were all scaled down booths realizing that there’s more tech people than HR prospects. No reason to spend much money and resources for showcasing your technology and platform. I get that.
(2) They don’t really have compelling mobile solutions or technology that looks presentable when compared to all the amazing solutions that are all around them, so better to stick with what you know, basically what 900 other CRAs are saying.
(3) The background check industry, including the largest CRAs are so out of touch with the future, they can’t even contemplate how the background check could actual evolve and embrace this future and really improve the user experience in all its now current and future manifestations. Instead they focus on compliance, turnaround time, coverage, great customer support, and accuracy. The result is everyone is saying the same thing and proving that we are a commodity.
And here is the important part. By everyone saying the same thing, with no real differentiators, all focused on the same value propositions, it means we are a commodity. To all the HR tech providers we are just a checkbox, a pain in the ass, a backend process that needs to be minimized as much as possible so their customers can have a great employee life cycle experience with their company. It’s funny, because almost every background check company I talked to complains about the ATS invasion. They are taking over, pushing us to the background, raising referral fees, switching customers, making us a commodity. I say, hell yes, because we’ve let it happen. We’ve done little to stay out in front, to give HR something to keep us at the front of the experience. What do you expect?
So what do you do? Here is what I’ve been saying and believe it now more than ever after HR Tech Vegas. You have to provide a mobile solution for the applicant to fill in information and check status and results. And it can’t just be a crappy reduced website. It must make it easy for the applicant. It must have text. It must be easy to use. It must be slick and brand-able for HR. It must represent a great experience that shows off the company's ability to move a candidate smoothly through the process. When you do this, you stay in front of your customer. You offer a differentiator and a little bit of glue to keep them from moving to competitor when an ATS gets a better revenue share deal.
I have to say, with the trends I’m seeing, I’m actually pessimistic about our industry. I’ve been in it for 20 years and our reluctance to embrace new technology, our focus on the same differentiators, and inability to really innovate, has left us relegated to a backend process where we are really almost all the same. What will happen is a continual move towards more commoditization, more pricing pressure, more industry consolidation. A few companies will come out on top and will continue to survive providing the same services but they’ll make it because they were able to win on price and eat up competitors and own the market.
My only response is we need to provide some innovative technology that keeps us relevant, that keeps us in front of HR, that really provides value to the customer. I believe that mobile is a step, it’s a right direction, but only a start. We need to continue innovating with AI, machine learning, make the background check so pervasive they don’t even know it’s happening while become faster and even more accurate.
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