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HR tech startups in India

Article  in  Human Resource Management International Digest · April 2018

DOI: 10.1108/HRMID-10-2017-0159

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 Human Resource Management International Digest
HR tech startups in India
Havish Madhvapaty, Anupama Rajesh,
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Havish Madhvapaty, Anupama Rajesh, (2018) "HR tech startups in India", Human Resource Management International
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 Viewpoint

HR tech startups in India

Havish Madhvapaty and Anupama Rajesh

The HR tech landscape Havish Madhvapaty is

Research Scholar at
HR technology at the workplace Department of
Using technology at the workplace is not a new concept. During the 1990s, HR Management, Amity
processes were efficiently integrated with ERPs. Processes such as payroll, training, Business School Amity
University, Noida, India.
recruitment, attendance etc. were handled, reducing the considerably reducing the
Anupama Rajesh is
transactional element on professionals. The HR Tech domain has evolved
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Professor at Amity Business

significantly over the past few years. New categories continue to emerge. In 2012, School, Amity University,
HRIS, talent acquisition, performance management, benefits and compensation, Noida, India.
learning and development, and job sites were the key categories of HR Tech. In
2016 onboarding, recruiting tools such as video interviews and assessments and
collaboration/communication tools were new categories. In 2017, we see HR
analytics, engagement/experience tools, automation, and artificial intelligence (AI)
as the strongest categories.
The HR industry is $54bn worldwide (Everest Group, 2017). Out of this, HR Tech is $14bn.
HR Tech has the potential for immense cost savings by Indian companies. Estimates say
that Indian companies can save at least $600m annually by 2021 using HR Technology
(PeopleStrong, 2017). HR Tech startups saw funding of $49m in 2015 (Tracxn, 2016) and
$16m in 2016 (PeopleMatters, 2017). Globally, this figure was $1.968bn (Everest Group,
2017).
Majority of investments are in the space of job-talent matchmaking, employee retention,
gamification, employee experience, etc.

HR Tech vs Fin tech

A perceptible whitespace exists between HR Tech and Fin Tech. Most organizations rely on
accounting software like Tally for keeping track of income and expenses. Then there are
newer entrants in the market like QuickBooks and Zoho. Salary and payroll processing
follows accounting, and is a link between HR Tech and Fin Tech. There are HR areas where
these solutions prove to be very useful:
n Payroll processing: This is more suited to Fin Tech companies. Solutions enable
employees to file taxes and assist in taking prudent investment decisions.
n Travel and expense tracking: The solutions available right now are very siloed.
Companies like Zoho and Quickbooks are creating more unified solutions by creating
interfaces for both employees and employers. Darwinbox has created integrated
expense tracking modules within HRMS solutions.
n Reward and Recognition mapping: This is aimed at digital reward system and tax
friendly benefits. Companies such as Sodexo and Zeta work in this area.

DOI 10.1108/HRMID-10-2017-0159 © Emerald Publishing Limited, ISSN 0967-0734 j HUMAN RESOURCE MANAGEMENT INTERNATIONAL DIGEST j
 The key benefits
The role played by HR in organizations has is continuously widening. HR is performing three
roles – administrative, consultative, and strategic. The first two can be aided considerably by use
of HR Tech. Technology helps HR in real-time reporting, allowing it to play a bigger strategic role.

The era of automation and analytics

PTA was expected to be embraced by 65 per cent Indian companies (TimesJobs, 2015).
PTA optimizes HR functions by predicting factors such as employee performance, attrition,
and cost. PTA can use multiple HR metrics data points, including but not limited to cost per
hire, time per hire, job offer to acceptance rates, vendor sourcing channels, etc. Analytics
can be used for practical questions such as:
Q1. How will a new hire or potential candidate perform?
Q2. How likely is it that an employee will leave the organization?
Certain sectors such as IT and Healthcare have robust analytics processes in place.
A key challenge is that data analytics is still being used on an ad hoc basis.
AI is expected to be a major disruptor in various sectors in the coming years. The HR
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community is also cognizant of this and is taking this into account at their workplaces. The
extent of disruption by some of these developments can be immense in the next five to ten
years in the way HR activities are affected. New jobs will develop and numerous old jobs
might completely disappear or be replaced by technology/automation.
The key advantages that organizations hope AI will offer are:
n recognize and collect critical data points;
n integrate individual elements of HR Tech into a unified organization-wide platform; and
n update skills os existing teams so that they are AI-ready.

The challenges
While organizations are increasing their spending on HR Tech, the deployment is a
concern. A key challenge is that employee skills need to be developed to utilize all this new
technology at the workplace. Organizations also need a significant amount of process
maturity to able to leverage the maximum potential.
Another challenge is that vendors are typically focusing on the management use more than
the employee side.

Conclusion
Several traditional HR jobs are focusing on areas such as collecting and aggregating data and
approval mechanisms are being replaced by HR Tech. Brand new job profiles are focusing
around analytics, vendor, and program management. Employee experiences and
engagement are coming up. While the solutions being offered are increasing in variety, and so
is the acceptance, there are several untapped areas which need to be covered to give
Keywords: complete solutions to an organization. From a HR buyer’s perspective, optimum use of
Automation, solutions and data is very important. Additionally, solutions should be future proof, and have
HR analytics, the ability to be integrated with upstream and downstream applications. The challenge for HR
A.I. (artificial intelligence),
Tech companies is that solutions have to be a combination of generic and point solutions,
HR tech,
which talk to each other. Also, the experience to the employee should be uniform and unified.
HRIS (human resource
information system), Technologies like blockchain, IoT, and AI all have the potential to fundamentally impact HR
Predictive talent analytics functions. Organizations need to tread with caution to ensure that they understand both
(PTA) technological and cultural implications of implementing these new technologies.

j HUMAN RESOURCE MANAGEMENT INTERNATIONAL DIGEST j

 References
PeopleMatters (2017), “The spotlight on HR tech startups”, available at: www.peoplematters.in/article/hr-
analytics/the-spotlight-on-hr-tech-startups-16394 (accessed 30 September 2017).

PeopleStrong (2017), “HR technology market landscape”, available at: www.peoplestrong.com/hr-

technolgy-market-landscape/ (accessed 30 September 2017).

Further reading
Jain, T. (2017), “SHRM India’s ‘3rd HR tech conference 2017’ gathers over 850 delegates”, available at:
www.dqindia.com/shrm-indias-3rd-hr-tech-conference-2017-gathers-over-850-delegates/ (accessed 30
September 2017).

Laha, R. (2017), “By 2021, Indian firms can save at least $600 mn annually with HR tech, say experts”,
available at: www.livemint.com/Industry/zkgNzj4xFIRSR6vR1mBNcJ/By-2021-Indian-firms-can-save-at-
least-600-mn-annually-wit.html (accessed 30 September 2017).

The Economic Times (2017), “Predictive talent analytics the future of HR in India: tJinsite survey”,
available at: http://economictimes.indiatimes.com/jobs/predictive-talent-analytics-the-future-of-
hr-in-india-tjinsite-survey/articleshow/48667794.cms (accessed 30 September 2017).
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Corresponding author
Havish Madhvapaty can be contacted at: h.madhvapaty@gmail.com

j HUMAN RESOURCE MANAGEMENT INTERNATIONAL DIGEST j

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