The State of Today's HR Tech Stack 2022-23

Build and use an HR Tech Stack that helps HR processes thrive

With a globally dispersed workforce, technology has become indispensable to organizations. It enables them to connect with employees working in remote locations, provides them with the required support to conduct their work, and effectively manages them.

An increasing number of organizations are today interested in learning more about HR tech stack and how it can be leveraged to meet their organizational objectives.
 

New research by HR.com's HR Research institute, ‘The State of Today's HR Tech Stack 2022-23’, explores various topics related to the HR tech stack, including the most commonly included capabilities, various issues, challenges and pain points, strategic alignment of the HR tech stack with business objectives, impact on key business outcomes, and more.

Below are the top findings from the study:

Finding #1: Payroll is the most commonly included capability in today’s HR tech stack

One of the major utilities of any given HR tech stack is to increase HR efficiency through streamlining and automating core HR functions.

Payroll (79%) and benefits administration (70%) are the topmost widely cited capabilities, as they are two of the most important functions in an organization. Recruitment/talent acquisition (67%) and onboarding (67%) follow closely.

Finding #2: Two-thirds (67%) say investment in their organization’s HR tech stack has increased

More than a quarter (27%) say investment in their HR stack has increased a lot over the past two years, and a further two-fifths say investment has increased a little. Just 7% say investment in their HR stack has decreased.

Finding #3: Most respondents are looking to enhance process automation with their organization’s HR tech stack

When asked to select the top issues that organizations are trying to address with their HR tech stack, respondents selected the following four:
●    enhance process automation (61%)
●    provide useful people data and analytics (61%)
●    provide employee self service (60%)
●    enhance employee experience (60%)  

Finding #4: Most organizations have two or more solutions in their HR tech stack

Today’s organizations have a rich array of choices when it comes to HR technology solutions.

Three-fifths of the respondents said their organization uses 2 to 4 paid solutions from different providers and 23% use 5 or more. Logically, larger organizations are more likely to use a use greater number of HR solutions when compared to small and mid-size organizations; 23% of larger organizations use 8 or more HR solutions.

Finding #5: Sixty-two percent agree or strongly agree their organization’s HR tech stack increases/improves organizational efficiency/productivity

Many organizations look to their HR tech stack to enhance the employee experience, organizational efficiency/productivity and HR’s efficiency/productivity. The HR tech stack can be used to automate, simplify and digitize operations also while enabling collaboration so that organizations are better able to achieve these goals. Technology also enables organizations to collect data points regarding employee experience that can be utilized to identify pain points and areas of improvement.

Over half agree or strongly agree that their HR tech stack improves the employee experience (54%) and organizational efficiency/productivity (57%), and 62% say it improves HR’s efficiency/productivity.