Business analysts and technology pundits have been kicking the software as a service ball back and forth from the midfield to the goal box for many years, taking their shots from a variety of angles. Much like comparing post-game strategies, recent articles indicate that perceptions of winning with SaaS depend on how many goals were scored.

ComputerPartner’s The truth about software as a service starts with a reaction to the spaced-out marketing statement that SaaS will eliminate both the corporate datacenter and CIO as an across the board replacement for all ERP applications. Back on earth, the focus returns to real-world benefits such as: “enabling enterprises' individual processes while delivering them through a standard but highly configurable code base”.

Compterworld’s Software as a Service: Time for the IT Industry to Take Notice points out that a survey of CIOs revealed that: “those who planned to use some form of software as a service over the next 12 months grew from 38% in autumn of 2005 to 61% a year later.”

CRN.com’s Top 25 Tech Breakthroughs Of All Time lists SaaS as a force that: “legacy on-premise software players—from IBM to Oracle to Microsoft—are scrambling to keep up with”.

Even The Wall Street Journal weighs in with Web-Based Services Take Hold.

And last but not least, eWeek’s 10 Things They Believe in Silicon Valley but Nowhere Else overplays the concept of “SaaS dominates all” due to offsides “sermons” from overexcited executives.

Although some say SaaS plays best in the middle market, we know more than 1,000 organizations of all sizes that have been winning the talent game using software as a service, scoring on improved efficiency, cost reduction, and overall ROI. In fact, Taleo counts a third of the Fortune 100 as customers.

The June 2007 issue of SHRMOnline offers some research perspectives on what high performance HR looks like in terms of six specific competencies.

New Competencies for HR cites the research done by Dave Ulrich from the University of Michigan and The RBL Group and outlines their findings in the 2007 Human Resource Competency Study (HRCS). Of note is the competency titled: The Talent Manager/Organizational Designer. According to the article:

The Talent Manager/Organizational Designer masters theory, research and practice in both talent management and organizational design by:
• Ensuring today’s and tomorrow’s talent.
• Developing talent.
• Shaping the organization.
• Fostering communication.
• Designing reward systems.

We also believe that successful talent management is more than just acquisition. Success does indeed lie in formalizing the processes around talent movement into and inside the organization. That’s why the aspects of workforce mobility, retention strategies, and performance management are important to address when HR uses talent management to improve organizational performance.

An interesting Wall Street Journal Online article, New Goal for Human Resources: Establishing a Work Force of One, discusses methods organizations can use to better meet the varied needs of their employees. Author Susan Cantrell, a fellow with the Accenture Institute for High Performance Business in Boston, emphasizes four methods in the article and the accompanying podcast.

The understanding that employee performance is the key business driver, coupled with tailoring offerings to employees, can create more value for HR department delivery to the organization through higher retention and employee satisfaction. According to this article, the best rule may be to bend the rules.

An article titled Managers don't care if recruitment money is well spent, based on findings from the Cranfield School of Management’s Recruitment Confidence Index (RCI), says that less than half of British firms monitor recruitment costs and three-quarters do not measure cost per hire.

Even though we know that making the investment in a talent acquisition system pays off in process improvements and a lower cost of hire, many UK firms lack the complete end to end process that delivers higher performance.

The Taleo Research study, Careers Site Recruiting in the FTSE 100 Companies: A Missed Opportunity, found that only 51% of the FTSE 100 enable online application with a structured form and automated process. Saving pennies by ignoring the wise investment in recruiting systems costs some firms many pounds in the long run.

With all the studies and reports about the challenges and opportunities around talent management and human capital, here’s an interesting one from the perspective of risk managers.

According to Best practice in risk management: A function comes of age, a report from the Economist Intelligence Unit sponsored by ACE, IBM, and KPMG, human capital risks are the most significant threat to a company’s global business operations.

Human capital risk, in particular, stands out as an area that respondents find particularly challenging. This risk, which is related to loss of key personnel, skills shortages and succession issues, has consistently been rated as among the most threatening risks that companies face in the two years that this series has been running. As this survey demonstrates, it is also among the most difficult to manage, and few respondents claim that they are effective at dealing with it. These findings point to the need for closer integration between the risk function and the human resources function, as well as a clearer understanding of the risks that companies face with their location and human capital strategies.

So since we already know attracting superior human capital and using talent management practices correlate directly to revenue and performance quantified as a talent quotient, the counterpoint is the relationship to risk that can be mitigated through retention strategies.

Surveying more than 500 executives, TriNet’s 2007 HR Trends: People to Profitability survey shows small and medium businesses are focusing on attracting and keeping talented employees as a top priority:

“For both larger and very small companies the attraction and retention of talent is more important than increasing revenue.”

Read the survey results to see how strongly executives believe that talent drives performance. You’ll know why when you click on our take on last year’s Gevity Institute and Cornell University research report: Human Resource Management Practices and Firm Performance in Small Businesses.

Companies that implement effective HR strategies outperform the competition, achieve higher revenue and profit growth, and succeed in highly competitive environments. This is especially true for small, high growth companies.

Performance when using person-organization fit employee
selection strategy

7.5% higher revenue growth
6.1% faster profit growth
17.1% lower employee turnover

Making the investment in eRecruiting pays off big time for small and medium business.

When asked about the impact on global business during the next five years, 78% of respondents to a recent survey indicated that “Increasingly global labor and talent markets” are important/very important.

The global talent factor was the third highest in importance as reported in Acting on global trends: A McKinsey Global Survey.

The survey also asked which trends companies have taken action on. In this case, “Increasingly global labor and talent markets” ranked fifth at 48%.

Conclusion? Issues around talent and a global workforce are clearly on the radar, but most companies have yet to move them up in priority and act.

Here’s more validation of good works translating into good business. According to a survey conducted by Sirota Survey Intelligence, “employees who are satisfied with their company’s commitment to social responsibility have positive views about their employer in several other key areas – including its sense of direction, competitiveness, integrity, interest in their well-being, and employee engagement.”

• 86% of employees who are satisfied with their organization’s CSR commitment have high levels of engagement. When employees are negative about their employer’s CSR activities, only 37% are highly engaged.

• 82% of employees who are satisfied with their employer’s CSR commitment also feel their organization is highly competitive in the marketplace. When employees are negative about their company’s CSR activities, only 41% feel it is competitive in the marketplace.

In terms of a talent management practice, satisfied employees are productive employees and have high retention rates. Attention to corporate social responsibility is not just good citizenship, it's good business.

Leading employers are constantly striving to find ways to differentiate themselves with candidates and enhance their employment and organization brand – especially with Generation Y.

Here’s one way: the 2007 Deloitte Volunteer IMPACT Survey found that providing volunteer opportunities can sway Gen Y jobseekers your way. 62 percent of respondents prefer to work for a company that provides them with opportunities to apply their skills to benefit non-profit organizations.

And there’s clearly room to stand out:

At Taleo, we actively encourage volunteerism and recently raised thousands for a great organization called Room to Read that is “changing the world, one book at a time”. This organization is responsible for building 287 school rooms, establishing 3,600 libraries, and publishing/donating 2.8 million books!

Good corporate citizenship may also provide an edge in building your workforce.