Spilling the Tea on HR Tech - How AI is driving internal changes in many HR tech companies, as well as changes in the overall tech market.

[00:00:00] A paper came out titled, Not Incentivized Yet Efficient, Working From Home in the Public Sector. Nick Bloom on LinkedIn, George LaRoe commented as well, talking about it. And what it showed was that there was a productivity increase, specifically looking at agents within crime prevention and how they were able to process cases, showing a 12% productivity increase in either hybrid or full work from home over those that were primarily in the office.

[00:00:30] So, you know, there's variation within that. This is one of the early studies, you know, the effectiveness of those cases. Welcome to the HR Huddle Podcast presented by Sapient Insights Group, the ultimate resource for all things HR. It's time to get in the huddle.

[00:00:59] Welcome everyone to Spill the Tea on HR Tech, where we focus on the hottest HR tech news everyone needs to know, to be in the know. We break down the news of the week and help you make sense of what it means for your industry and how it can impact your organization. And we are recording today on February 26th. How did we get to the end of February? It feels like this whole year is running so fast, but that's okay. We got a lot to go to get into today.

[00:01:22] We're going to bring you all the news you can use this week. And I'm your host, Stacey Harris. I'm Chief Research Officer and Managing Partner for Sapient Insights Group, a research and advisory firm. And joining me today is my co-host, Cliff Stevenson, our Director of Research and Principal Answers for Sapient Insights Group. Cliff, we've got a lot to get through. I mean, the tea just keeps coming. We actually thought at the beginning of the week that it was going to be a slow week, but it's not the case, is it? That's right. Yeah. It's one of those big sort of like water towers, but just full of tea.

[00:01:48] There isn't as much, which we've seen earlier, so much merger and acquisition activity. Not as much that, but there's a lot of very interesting things going on with people this week. A lot of people moves that I think will raise some eyebrows. All sorts of, you know, we've got funding and we've got some new reports coming out. We've got some organizations that are sort of up and coming and just really interesting things.

[00:02:15] A little bit of, we'll admit, there's some bad news. You know, anyone that's paying attention to this will probably anticipate a few of the stories we're going to talk about in terms of downturns, some ones that are very personal to you, particularly Stacey, that we'll get to towards the end. But, you know, some positive news. And of course, you know, I'm getting prodded. Yes, we, AI, we'll be talking about AI. Can we say it one more time for the crowd?

[00:02:41] But before that, I mean, we're definitely been on the road or I am, you're getting ready to go. So I just got back last night from an, from a session that I did at Workday on some of our data, some customer feedback, which I think is a great thing that we, so everybody know that we do share this data. It's a big thing that we make sure the vendors get a chance to hear. And it's an important part of why we do the research that we do. Cliff, I mean, I think you and I have talked so many times about how much those comments,

[00:03:09] and they're all anonymous, but they're all aggregated and they're kind of aligned with what's going on inside that organization. But it's a really big value proposition when people participate. And I think we're up, I think last year we had like 15 or 20% of the participants who took the survey, took the survey to give feedback to their vendors in a way that I think is safe. And, and to be honest, can be aggregated with everybody else's comments. So it's not just your one comment, right? So that's a real powerful thing. We're also going to be on the road though, coming up here in March,

[00:03:36] you and I will both be at the ISOLV users conference, March 16th through 18th, I believe it is. And that's in Scottsdale, Arizona. Again, I have been to Arizona a ton this year. So that's excited to go back to Scottsdale again. And then I think you're going to take a John over to ADP's users conference for just a day or two after that, aren't you Cliff? That's right. Yeah. Yeah. I'll be over there. In Las Vegas. I think they're going to do that. Of course, of course. Executive round.

[00:04:03] You go to, yeah, you're right. The Fairmont Princess, thank you very much for hosting us there in Scottsdale. Has been more active and we love to see it. Of course, we love Las Vegas too, but those that be watching this on YouTube will notice I'm rolling my eyes when I say that. Yeah. And then in April, I'm going to be back in California again for Workday's doing an innovation session for the analyst. So we'll give you some more updates there. And I'll be bringing a little

[00:04:30] bit of update today on the RANSTAT conversation because we did have some conversations on that, but we'll have more updates in April on what they're doing with all the AI and agents and all that work. And then right after that, the week after that, Oracle also out in California. So I'll be back to back is doing their sort of executive summary event that they do for analysts and investment communities and everyone. Again, that will be focused. I'm pretty sure on what's happening in the AI space. I think both of them are kind of going head to head on this conversation.

[00:04:59] Interesting to see what's going to be Oracle's perspective on the shifts and the changes for their industries and the focuses on, I think last time we were there, they had a big, heavy focus on healthcare. We'll see if that will stay as big this year, right? Next, you and I will both be in May going to May 5th through the 8th. Well, we'll be speaking virtually at the HR Tech Asia event. So I'm not going to be doing that in person as much as I would

[00:05:24] like to. But we do have a story, I think, coming out in the HR and Asia article. But tentatively, right now, it looks like it's going to go through that I'll be speaking at the May 6th through the 8th Unleash event. And that's, we haven't done the Unleash in a while here in the US. We'll be on the last day, I believe, because I also have a client event in Charlotte, where we'll be doing a local conference in Charlotte with the ISOL team. So it's just a lot of big events this first quarter, more than we expected. And most of it is for us to share the data that we've been

[00:05:54] giving. The Unleash event, we'll be talking probably about AI is the goal. So we'll have some more updates on that. And then Cliff, you're going to be going to Work Human in May as well. That's going to be back in Denver. And then we're also possibly we're still working on it going to be in Minneapolis, Minnesota, or in Minnesota, with the Learn audience, L-E-H-R-N. If you don't follow them, they are a great local community talking about HR technology, leading edge HR network, I think,

[00:06:19] is what Learn stands for. And that's going to be May 15. And then we've got the UKG analyst event in Miami, May 22nd, Cliff. I think you and I are both attending that June 16th through 18th. We're doing another ISOL. Oh, you're doing the ISOL event at June 16th through 18th in Las Vegas. And that's a sales kickoff. And then, well, we know at that point in time, the rest of the year spent trying to get the survey up and up. So if you are a vendor, or if you are even a practitioner

[00:06:48] trying to figure out where to see us, one, those are all the places we're going to be at. Sorry, I did not mean to read off your grocery list here for you. But secondly, I think what's more important is if we're not getting back to you on events, Cliff and I try and go where we can. But I will say, you know, we always have to pick and choose and prioritize. Our goal is to get as much data as possible before we launch the survey so we can make sure the survey is updated as well as possible, or after the survey is out so that we can add commentary to the data when it comes back out.

[00:07:14] Our reason for these events is not to just go and hear what's going on. It's to go and make sure we're adding the right things to the survey. And we're, we're listening to the practitioners as our favorite events or when practitioners are at these events, because we get a chance to talk to the practitioners. So all that being said is it's going to be a busy couple of months, Cliff. So you and I will be in airports and we'll see everybody in the airport. So, but where are we now that we're sort of through all of our events, Cliff, where do we want to start on the

[00:07:41] conversation with the news that's going on this week? Well, you know, you mentioned events, that would be a good place to start. Was there anything that came out of your conversations with Vinly that you're able to share with us? I know that it wasn't, you know, a big customer event where there's going to be a lot of news, but anything that stood out from where you just come from, that's fresh on your mind, because we're going to be talking about work day later on too. So. Yeah. Well, I think the big conversation, I mean, obviously there were, there were some

[00:08:10] big announcements made and we'll talk a little bit about those, those personnel announcements. And I think those are going to have an impact on the heels of what is really good business numbers on the heels of what was, to be honest, a layoff of the, you know, work day. So I think, you know, the environment was somber, which is a good way to put it. Right. I think everybody's going through a lot of changes, particularly the product team. And, and that happens as organizations change and grow. Right. They're on the news front. You know, I think the big conversation for them,

[00:08:35] it still continues to be their AI agent conversation. They are really wanting to lead that conversation. We know from our data, and this is, you know, again, you'd look at this in the report is that work day is the only organization besides SAP and success factors. Those two are the only organizations that their customers were utilizing or were more aware of their AI inside that system than the percentage of customers who just weren't aware they even had AI in the system. Right. So

[00:09:04] that's just a win. And work day was at about 45% of their customers last year who were saying, yes, I am already using AI in my technology. That was not as high with the other vendors and in our data set. And so I do know that this has been a big conversation. A lot of it led by their president in technology officer, who we're gonna be talking about a little bit later, Cheyenne, who has been at the forefront of what's happening in the AI market. But I do think this conversation with Randstat,

[00:09:33] which is a partnership last week, I think this was interesting. One, it's an, it's kind of an RPO relationship. So it is the idea that one of the, one of the challenges that worked in all the, of the platforms that are at the enterprise level have is that as organizations go up market, what they tend to lose out in their mid-market solutions, if they're not careful, is they lose out the services that a lot of those mid-market providers offer, whether that's RPO or ASO or

[00:09:59] managed services or just payroll services, those kinds of things. The big tech vendors, that's not the space they're playing in. They don't get, the stock market doesn't provide them any value proposition for being in the services business. And so you have to find a good partner to do the services for organizations because you can't offer them in your technology. And so WorkDays really created a pretty good relationship with Randstat. The other part of this though, is that Randstat is going to be using, and Randstat, for those of you who might not know, that is a big company and sort of the RPO,

[00:10:27] recruiting process outsourcing, as well as in sort of temporary work staff, staffing agents, those kinds of things, right? They've been around for a long time, have done really great research. One of the larger firms in the market. And what I think is really important is that they're going to be using WorkDays Illuminate, which is basically their broad term for their AI, which has a lot to do with this, their AI solutions, their AI agents and their AI bots. And then they're going to be also

[00:10:53] leveraging this agent technology platform thing. And so that to me is probably the most interesting part of the Randstat conversation is that this is as much about an AI relationship as it is about a services relationship. And I think we're going to see that more and more as organizations are going to start picking. Looking for the inside scoop on payroll, whether you're a payroll pro or just curious about your paycheck, we've got two podcasts you cannot miss. It's about payroll delivers the

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[00:11:49] for AI. And we don't know who's going to win in this race, but it's kind of like the days of, are you going to be in Amazon cloud or are you going to be in a Microsoft cloud or are you going to be in an Oracle cloud? This is the next thing. Whose AI am I going to latch on to, right? Yeah, that's right. And I think broadly too, it shows something that we've repeatedly sort of said

[00:12:13] is that part of those adoption number discrepancies, right? Where we see, okay, Workday has got a larger percentage of people who are using AI than the general population. And it's because they are finding use cases. They're finding something people want to use. They're not a solution in search of a problem. They're saying, here's an issue. You're trying to fill positions in both now and probably the future,

[00:12:38] a very tough job market. So you go, okay, well, I can't find any of this is now I'm going to switch over and look at staffing agencies and see if, can I, can I maybe fill this position another way? Instead, it's all there. It's using AI to say, okay, you're searching for these type of skills. Let me also search this other database where things are codified differently, but using AI, I can find it in the same seamless package and present to you as a recruiter some other options.

[00:13:07] And it's always been difficult as someone who's come from that world to kind of switch gears and go, okay, I've got to now think this way and present this set of colleagues. Said it's all there. It's all there in terms of candidates. So that's really great. And of course, you know, Randstad, as you mentioned, you know, they're the biggest globally company that does this. And so is Workday. So a very good partnership between just absolutely titans within the industry.

[00:13:37] Yeah. And I think this will add to Workday's focus on global, right? So I think that because of how global Randstad is. And I think to your point, you know, this is bringing, I think one other thing Workday is probably working on and you're watching them do this with bringing in partners is how do I get not just the tech, but, and not just the services, which is a service partnership, but the assets, the content, whether that's list of candidates or whether that's content on a

[00:14:06] learning side or whether that's, you know, data from a compensation benchmarking perspective, right? Like all of these things are things that Workday is working on because it fills in the gaps that a lot of small providers are offering that make that, that make it less valuable to work with the larger providers because they don't have these sort of built-in feeds of things. And so it'll be interesting to see how this impacts, you know, this is one of many, I think that we're going to see the market, but it'll, it'll probably impact a couple of organizations who were building themselves around the fact that they brought the lists to the, to the system, right?

[00:14:35] That's exactly right. And, you know, speaking of global companies, we've got Darwin Box. Now this is some reporting that's being done. So when we're speaking here, we're talking sort of journalistically, you know, seeing the reports that are coming out. This isn't something that Darwin Box themselves has mentioned, at least not at the time that we're recording this, but they are looking to raise and they're set to raise about between 120 to 150 million in a funding round.

[00:15:03] That's going to be funding from KKR and Partners Group. And this, all these sources are coming from Mint. So, you know, this is pretty interesting. You know, Darwin Box is bigger than you might realize. They were previously valued at 1 billion. They're around that now, 950 million, but that don't think that they're declining. That's just a valuation. They have actually been growing significantly.

[00:15:28] They're at a 58% year on year increase in total revenue for this year. So very impressive stuff. Darwin Box is one that we've seen in our report and our data getting written in quite a bit. We have them as one that can be selected. People write them in. I think sometimes people get a little confused on the name, but it's one that we've seen a lot of growth from where, you know, we're starting to highlight them more and look at them more. So they're very strong in the Asia Pacific market,

[00:15:58] which is a market that we're gathering more data in, and which I think, but they are moving, trying to move into the U S market. So I think that's why you're starting to see some of this. I think the other thing that this highlights is what we're going to see across the market is that the big advantage that the larger firms have right now, when it comes to the AI conversation, is that AI, no matter how you do it, is still expensive. You and I have talked about this. We don't have to get into all those details right now. So for these smaller firms or firms who are

[00:16:23] in startups, what we have to be really aware of is that it is going to be really hard for them to, to address the AI conversation without a, a, a significant infusion of finances, right? Like this is not, I think that's sort of the interesting story that you see in a lot of other places where, yes, if you have someone who knows AI and is working fundamentally with AI, you might be able to be a small startup who takes off pretty rapidly. So there is space for that. But if you are sort of

[00:16:52] in the middle ground and you did not have an AI startup or an AI founder, the, the, the cost it takes to get into this market now is so extreme, both in skillset capabilities, just sheer server power, right? Like we had that conversation at work day this week as well. Like that's, that's the big positive and or negative, depending on how you want to look at it, that why I think the big enterprises are sort of

[00:17:19] snapping up a lot of smaller players in this space is because getting into the AI space is going to be a lot harder for some of these organizations, not to say they can't, but they do need some infusion of funds. And you can definitely see that's part of what they said that infusion is for, right? Is that their growth, if they want to grow, they want to grow more with AI. We are very aware that AI should not be your only strategy. Let us put that out there as people who are watching this. There's a lot of people who are going to be disillusioned in this, but it has to be part of your strategy, right?

[00:17:45] Speaking of strategy, we see some movement from someone I think we both know, Jason Putnam. He's going to be taking over as CEO of a company called Vetti. If you don't know Vetti, they are the vet in Vetti, I'm assuming comes from the term to vet somebody, you know, to check them out. That would be my guess, but they do background checks and more. I think their own ad copy says

[00:18:12] something that from background checks to health screening and everything in between. So that's really interesting. I I'm, I'm very proud. I think that's very great for Jason to do that work. You know, I think it's really fun too, to think about something that's, I think we've seen a little more movement in this area. You know, we've talked to, you know, Experian just recently about some of

[00:18:37] this. This isn't, I don't know. It's like a growth area. Interesting enough. It's a strange juxtaposition between this idea that we're seeing layoffs, but there must be also quite a bit of hiring because right. That's going on at the same time, right? We're really talking about deficit between hiring and layoffs. When we talk about the overall job market, that doesn't mean the hiring has gone away.

[00:19:00] In fact, it's very important and more important than ever. I apparently to have all of your ducks in a row as the expression is to make sure that all of your information is correct. You don't want to spend all those resources and then find out that the person you've gone through all that trouble, perhaps you've pulled in someone from, you know, these big databases now that, you know, Randstad and Workday have put together. And then all of a sudden you find out it's not the right

[00:19:26] person. Well, there's more and more of these services coming up to take care and to alleviate those concerns. Yeah. I think background check is something everyone should be watching carefully because I think we're going to see it evolve pretty rapidly. And I think it's going to, it is going to become more critical because what we're seeing, it's interesting. I was just watching one of my favorite sort of tick tock. And I know some of us are watching tick tock, some are not. You have a download on your phone. You've got a really well, my kids tell me that my phone is

[00:19:54] worth a lot of money because I got tick tock on it now. But, but she, she does this sort of walk through of her life in Japan. Right. And the biggest thing that she notes is how every video that they take every, even, even when you're just having conversations with friends are filtered and they've got overlays and every picture you take has overlays on it. And I think, you know, the deep fake models that we're seeing out there, I think the, the, the background checking is going

[00:20:19] to merge eventually with, we're seeing some really interesting things with the, although we haven't heard a lot of it in the, in the news yet, but I do think it's going to come out with our, not robotic process automation, but the, the work around verification that. Oh, like blockchain auditing. Blockchain. Thank you. My brain was, my brain was. We have a big emerging tech section in our paper and it can get. Yes, exactly. And, and I, and I will have to state that I was on a plane late last night, but blockchain, I think is going to merge with this a little bit more. We're going to see it

[00:20:47] kind of come in play. And we're, when we talk to our practitioners who are, who go to our, our building interest in some strategy workshops, the, one of the biggest things they're always looking for is, is background and I-9 verification tools that match with their current systems that work effectively that cross across platforms. And so this is good. I think for Jason, it's good to see him move into this role. I know he's been looking for different leadership roles. I know he's been a longstanding member of the plum leadership and really helped that group and

[00:21:15] Caitlin and the group sort of build up that brand of plum, which was an assessment tool for hiring. So I think this fits with where he's been at and we'll see more of this. Yeah. Yeah. And some more people movement that you alluded to early in the show, Stacey, and I'm very excited because I think we're going to get to our namesake of our show, spilling the tea here. You've got some insider information, maybe a little bit, but yeah. So Carl Escombile on the CEO of Workday had mentioned, you know,

[00:21:44] got some great results from Q4, fiscal year 25, but they announced a step down. Cheyenne Chakraborty stepping down as president of product and technology, retiring from Workday, been there for 10 years and welcoming in Garrett Kazmaier to be that new president of product

[00:22:07] and technology with a lot of AI background there. Now you've known Cheyenne for a number of years, it sounds like, and a lot of the, it sounds like a lot of the innovations that you recall were under his watch. Yeah. So, I mean, I got to know Cheyenne probably a couple of years back when I started getting a chance to sit in on the executive round tables that they would have at the end of the analyst events. And I got a chance at that point in time to get to know Neal more. I've gotten to

[00:22:33] know Carl for that. One thing I think that people have to realize is that, you know, every company goes through transitions, right? Like, like you, there, there's some really big decisions that get made at the top about where our organization needs to head. And a lot of it's driven by what's hoped going on in the stock market, going on politically, going on just simply by what the amount of open space to, to win at in a certain market where they may be strong, all of those things. I'm not privy to all

[00:23:02] of those conversations at the Workday level, but I do know that for Workday, we're in probably a transition space, right? You know, we saw Neal not retire, but move into a role where he gets to spend a lot more time in the thought leadership and in the technology space, which is where he loves and he started off with. He was on the announcement about their agentic AI platform with David Summers a few weeks back. And so we know he's still there and involved and very passionate about the work that

[00:23:28] he's doing. Carl's definitely taking sort of the lead on sort of optimizing where Workday is going to go, making sure the shareholders are getting the value proposition out of what they're investing in. They've got strong growth in their stock market. Cheyenne has always been, I think, one of those forces behind the scenes that was a real stable perspective on both how we're looking at AI, how we're looking at AI ethically, also how we're thinking about technology at the center of the

[00:23:55] focus for what Workday is trying to achieve. You know, architecting an environment that could be plugged into that could, that had the extended platform, those kinds of things with a lot of help from his team, right? Like I think it's nice about Cheyenne. He will, he will very gladly tell you that this is a team effort that they put in place. I'm not surprised by this because I do know that, you know, it's been a bit overwhelming. Cheyenne is also one of the, up until, and I don't know

[00:24:20] probably now, but up until recently, he was also an advisor to the government at several levels on AI. He was on different boards and groups there. And so I do think that, you know, in this particular case, there's an opportunity for him to step back and maybe focus on the things that he really wants to focus on. Right. So, so this isn't surprising. I think this has been a lot on his shoulders. Now looking at Garrett Casimir, I don't know Garrett, and I'm not sure if it's Casimir, I'm probably saying his name incorrectly. It's probably Casmeyer. Casmeyer, thank you. Yes.

[00:24:48] I apologize, Garrett. If you've got a pronunciation you prefer, let us know. Yeah. But I mean, his background is an interesting one because he definitely comes most recently with Google and also done some work with Looker was also had a strong background in SAP, particularly SAP for HANA, which was their big sort of shift to the cloud and sort of ongoing technology improvements. So I think we're going to see a lot more one ability to work globally coming out of,

[00:25:16] of, of Garrett, right. Which I think is going to be a big win there for, for work day. His focus probably on data and the data pathing and data analytics and that kind of work with his background Looker will probably be really strong here. And I know that's a piece that, that work day is looking to elevate more. So, I mean, this is, it is, it is a shift and there's no positive or negatives. I think with any of this, I think the part of this is that we are seeing transformations at this point in time. And I think everyone who's working with work day needs to,

[00:25:42] as customers, just make sure they're staying very close to their account representatives, to their personal contacts within work day and say, I want to make sure I know where this is heading and where our relationship as an organization fits in this picture. So again, I always tell buyers, you know, you, you are an important component of that vendor relationship. You have to make sure you're reaching out as much as they're reaching out to you. And you need to make sure you understand

[00:26:08] what any shifts mean to your opportunity to grow with the organization and continue to do the, the, the, the great things you guys are doing together. So yeah, it's going to be, I think, a shift. I think if you're a customer or if you're looking at acquisitions, you just need to make sure you have conversations about what the future looks like for you. Right. Wonderful. Yeah. Well said. So we do have another bit of movement at the top levels of companies. Zoho, who we've long talked about and kept an eye on and discussed on the show.

[00:26:38] So their CEO is actually going to step out of the CEO role. All right. So Shudar Venbu, who has been the CEO for a very long time, he's now going to be the coder in chief, chief scientist, I believe will be his actual title to specifically start developing and continue to develop the agents

[00:27:01] that Zoho will be using the AI work that we know is, as we've discussed, very important to many of these organizations, especially the very large ones like Zoho, you know, that have near what 900,000 customers, nearly a million customers. So, you know, that kind of, you know, makes sense for a company of that size to make that investment. As you said, it can be resource intensive, it can be expensive,

[00:27:28] and clearly they believe it is of such importance that their CEO will actually be leading that charge from there. So, and you see something like this before, you brought up an example that I had totally forgotten about. Well, yeah, no, I mean, this is what I just mentioned, actually. This was the exact move that we saw Neil Bootswain make over at Workday, right? I mean, obviously, different organizations, different sort of focus areas, particularly Zoho is in a different market, but to some extent, you know, they're trying to move up market. I think it's the same thing.

[00:27:58] AI is shifting the conversation so much, it does require a lot more focus. And for many of these founders, it's a new way of thinking, which means they probably have to take some step back from sort of managing the everyday to be able to kind of embrace it. So I think it's going to be a really interesting conversation. There's also, I think, opportunities here where we're seeing new leadership come in. I think we have to be very aware of this as new leadership oftentimes comes into organizations when there's other things that are changing rapidly. And we do know around the globe,

[00:28:25] not just here in the US, but all around the globe, we're seeing changes politically. And that has an impact on some of these movements as well, right? So we have to be aware of that too. But I think the big thing here is AI is it's driving a lot of change inside of organizations, not from, and this is what I always tell people, it's not, it is not changing the work we do. It is changing how we might get that work done and how we, and, and, and who might be doing that work, which I think is the

[00:28:54] conversation that's coming, right? That's absolutely right. So then we've got some news from Anaplan that saw some very strong growth. And, you know, over the last two and a half years, for instance, their annual recurring revenue has gone up from 600 million to 1 billion. Speaking of sort of the big numbers, just last year, they added 300 new logos and expanded just the sort of average size of those

[00:29:23] companies, right? They, you know, the number of customers with subscriptions larger than 1 million grew to over 200. But what I found most interesting and a sort of positive sign, because, you know, we've talked about some of the things that happen in the workforce and HR tech, especially, and we're going to talk about it more too, on the layoff side, they are seeing, they are increasing the number

[00:29:50] of software engineers up by 40%. You know, again, they want to start innovating. Some of that will be AI, but they didn't specifically say just innovation in general, which you really like to see. I think that we've historically seen those organizations that focus heavily on R&D and on innovation do end up seeing market success. It's, you know, you're investing in the right area when you're doing it

[00:30:18] in that way. I remember that was something that Ultimate Software prided themselves on. Now UKG putting an immense portion of their profits back into innovation into hiring R&D. Yeah, R&D is a big win when if you're investing in that area, when you're when you're at a growth phase, I think of the market, right? That's right. And then the flip side of that is some cuts. This

[00:30:43] was big news that broke out of I think the HR tech circle. I can always tell when it's big news if my non-nerd friends tell me about something that's going on. Of course, this is Dayforce cutting about 5% of their workforce. That is very significant overall for the HR tech world. It's very meaningful in my local area. Dayforce has a large amount of their workforce here in the Tampa and St. Petersburg

[00:31:12] area where I'm at. So I'm seeing sort of some of the personal repercussions of that from people that I know in this space. But again, they're positioning this as they want to do a restructuring. That's how it's usually talked about focusing more on, you know, towards profitability and more towards using some of that towards hiring people in different areas. Probably not surprisingly, I imagine some of

[00:31:41] this will go towards, you know, some R&D, as we just mentioned, one would hope anyway. It's interesting, because I was looking to see and I don't think they mentioned AI in here, which I thought was sort of interesting. At least I'd have to go look at the full thing. But in the piece that you've got here for us, and I didn't hear about it as an AI driven cut in the comments, which was sort of an interesting conversation. I think for Dayforce, they're one of the few that didn't do that. But we do know that efficiency and figuring out profitability is a big conversation

[00:32:09] on everybody's bottom lines right now, right? Like, like everybody's kind of hunkering down a little bit. We're kind of that wait and see to see how much the markets are going to shift. A lot of Dayforce also has Canadian based workforces, right? And so they also have Minneapolis. So we've got their they're kind of spread across the market. The other thing I think I didn't get a chance to mention on the Anaplan, I think one, there might be some conversation about why are we mentioning Anaplan? Most people think of it as a financial planning system, right? We know that they play heavily in workforce planning. As you're thinking about headcount

[00:32:38] planning from a technical perspective, we see them show up in data and analytics, our section all the time. And interestingly enough, they showed up in time and attendance and scheduling tracking this year, just slightly not enough to make the full chart. But we did see even some a large enough amount that we were able to put them in some of our asterisk charts. So I do think we're going to see this growth of sort of data driven optimization is a better way to put it, right? And I think that's what Anaplan is definitely doing. And we have to know that

[00:33:05] scheduling is a big part of what day force does as well, that their biggest sort of well known features and capabilities and their time and attendance and scheduling. It's what's where day force start out and then sort of grew from there. And so I do think we are seeing those kind of organizations who are in this space where we're talking about workforce, headcount management, workforce, scheduling, workforce, labor and leave and absence. Those systems are going through a lot of changes right now, because the question is,

[00:33:35] is when we take a human element out of it, what does it look like? And how do we keep it feeling very humane when you're doing that kind of work? We all know the issues that we've seen in the past with clopening and people don't get time to do bathroom breaks and, you know, just kind of crazy stuff that goes on in the market when you don't manage your these areas very well. These impact people every day. And so kind of on the same vein, they both run in the same space there,

[00:33:59] right? Absolutely. So what we're getting towards, you know, those were sort of the big main stories, a few interesting things that came out that are, as you said, people might say, well, what does this got to do with anything? But there's a few reasons we're going to bring this up. This one was pretty interesting, though, because it is something that maybe it isn't HR tech, but I think it relates to topics that we talk about quite a bit and within the paper, and it's on people's minds. A paper came

[00:34:27] out titled not incentivized yet efficient, working from home in the public sector. Nick Bloom on LinkedIn, George LaRogue commented as well, talking about it. And what it showed was that there was a productivity increase, specifically looking at agents within crime prevention and how they were able to process cases, showing a 12% productivity increase in either hybrid or work full work from home over

[00:34:54] those that were primarily in the office. So you know, there's variation within that this is one of the early studies, you know, the effectiveness of those cases, I'm not sure you know how well it goes into it that will have, of course, a link to the entire research paper. But again, it points towards this idea that there's ideas of being well, I think it's like this, I feel like this. And as you mentioned,

[00:35:21] Stacy, we're trying to be more data driven organization trying to be more data driven, we have everyone's got a feeling about it. So it's really neat to have us and some data some actual research on no, no, this this is better, you know, we're going to lose both productivity and of course, real estate costs, by just a vibe that people need to be in the office to be productive, because everyone goes off their own individual experience, don't they? We've all probably either been that person or have known

[00:35:51] someone who said, you know, I work better in the office, and that's okay. Right? So but it's letting people make that choice and understanding that, you know, for many people, their productivity won't be your productivity, you know, they don't work the same way you do. So you need to be able to find ways to assess productivity, that go beyond, you know, a computer that watches your movements and make sure

[00:36:17] you're not just doing things that was one, we're not going to get to it today. But I will link to it, a company called Optify, that was promising higher productivity by making sure people are always staying focused on their job, which isn't what anyone wants. Yeah, yeah. My only comment on this is that, you know, I think this, this, this, you know, pulling everybody back from work from home, I know the government's really pushing on this. These are definitely right now veiled excuses,

[00:36:46] in many cases, to remove additional workers inside of workforce without calling them layoffs, in many cases, right? And I think we all know that that's kind of where that market is at. But I do think once this all balances out over the next three to four years, we are going to find that businesses are going to realize that there is a balance they can create, because you do have to have an in office environment, particularly for new employees, as particularly for those who come fresh out of college, to have an environment where they create

[00:37:13] the relationships they need to create. But I think this, this balanced hybrid model is, is definitely what we're seeing works for a lot of organizations, gives a lot more autonomy and freedom to the workers, and creates kind of the same kind of camaraderie that you that you need from the in office environment. My sense is that we'll balance out with that. It's just, you, we cannot discount the amount of data we're seeing on the improved wellness and, and, and work productivity eventually. Now, what we are going to also have to make sure is that we are

[00:37:42] combating loneliness, which is another step that keeps coming out of all of this. And so there is, you know, I'm not a big advocate, like you all work from home, you and I work from home, I've been working from for the last 12 years. But we do a lot to get out to meet people. That's a big part of our role. That's why it makes it sustainable. I do think that this, the hybrid model is probably a more reasonable model, right? Yeah. And they did find that, in fact, I think the actual line that was pointed out was that

[00:38:08] fully remote offered no additional change versus hybrid, meaning those two were about the same. Those employees that were work from home on average, three days a week in office, two days a week, it seemed to be a sort of sweet spot there. But again, it all depends on how you work, the type of work you do, and what works best for you. But you need to be able to prove that with numbers with anything else. But you mentioned layoffs. Now this is one, they're not HR tech,

[00:38:34] but Stacey Harris did work here for a long time. And that is Joanne Fabrics. You've used sort of your sort of case studies, your personal experiences to illustrate what this means in the workforce. I've always enjoyed that. I've known Joanne Fabrics as a customer, not an employee, for years and years. And we knew that they were closing down stores and going through restructuring. But the sort of final

[00:39:01] nail in the coffin seems to have come through. They are fully going out of business and shuttering all stores after more than 80 years. For those of you that, you know, sort of have the mobile app and do online, they are going to keep that open and use that for a lot of their going out of business sales. So this might be a good time to jump on to Joanne.com if you want to get some good deals. But sad.

[00:39:28] I don't mind plugging a company that's going out of business. They're not paying us for this. Yeah, this one was hard. I mean, and I know, you know, it's, it kind of goes the way of the Blockbuster and, you know, Sears and some of the others that we've seen in those of us who grew up Gen Xers, kind of our childhood, right? But Joanne was particularly important to me because I did, I worked there for many years. That was my last practitioner, HR practitioner role. I was hired in

[00:39:56] by Tina Hopner, who was a dear friend who I'd worked with over at Key Bank. And I made some of my most longstanding friendships there. Julie Duda, who was a really good friend of mine who worked with me over at Burson as well. Marilyn Cohen, a couple others. I mean, they're just friends that I, that I have on Facebook friends that I keep in touch with. But, but here's the big thing about, I think the Joanne Storrs conversation that maybe we'll play into what's going on here

[00:40:21] with us in the HR tech space. One is I was laid off from Joanne Storrs in 2007. I was in one of the many rounds of restructuring and downsizing in 2007. And they had really focused on cost cutting at that point. Cost cutting was the big, and they were, they brought in at that point in time, I don't know if he's still there or probably not, the CEO who had been a CEO over at Kroger's or been a big role over at Kroger's. And they were trying to run more like a more efficient retail environment.

[00:40:47] I will say that, you know, one of the things I find is that you do have to be careful about how much cost cutting you do in an environment. That is the only thing I will say about that is that I love Joann's and I will, and even after I had been laid off, I was trying to call them back and say, like, here's the things you could be doing with all this stuff that we loved hanging. I was that kind of weird employee because I wanted them to succeed because I do think they played an important role in the market and important role in sort of just, they were one of the, they were one of the few

[00:41:15] organizations who had figured out at that point in time, how to make money off of an industry, which is fabric, which does not give you a lot of space to make money off of. They were competing with a lot of organizations that weren't selling fabric, but were selling other craft items. Right. And so I, and, and I have the honor of meeting Betty Roskam, who was one of the founders and whose son, Alan Roskam had ran it for many, many years and understood the power of her and how much as a

[00:41:42] female leader, she had invested in that organization. I mean, she was still there and we were doing orientations at the corporate level. We made a point of bringing every orientation group through to her offices to just have a conversation. She ran special projects, which is basically special cuts of fabric and stuff for very long into the time. I mean, you know, way past when most people would have retired. That was an organization that did feel like a family. Families don't always last. That's a part of the problem. Right. But what I do think is that there was a passion around

[00:42:10] the customers that probably could have been developed a lot more that once they started optimizing and started cost cutting and started trying to work like the rest of the retail world, they lost, I think what could have been a real opportunity to, to focus on the influencer market, right. That was growing that you see with a lot of other stores now. Right. And I think part of that, you've always got to balance. And I think this is a warning shot for all of our HR tech

[00:42:37] providers out there. You've got to balance meeting your profitability needs and meeting your running your business needs with engagement with your customer and making sure that customer understands how valued they are in your bigger ecosystem. Right. Because over time, they might not be there. Right. They might find other ways to buy things online. They'll find other ways to get things in different ways. If you haven't figured out a way to make them feel special in your environment. Right. So

[00:43:03] my two cents, I, my heart goes out to all my friends over at Joanne. I know for many of you, it was a passion. You were working there and trying to make it work because you believed in, in the mission. I know that's the same with every organization that goes out, but Joanne starts, it's a passing of a, of a very sad time for me. Yeah. Yeah. Well, I don't know if this will be, if this is a positive note to end on or not, but I did find it amusing or enjoyable karmic, perhaps.

[00:43:33] It was Anita Lettings post on LinkedIn that you sent me, Stacey, that I got a bit of a giggle from. This is from Klarna. Klarna does payment systems. That's how I mostly think of them, payment processing. I, and I, it would be all right. Unless you would like to do it, Stacey, we'll just read the post. I'm just going to read Anita's post here. It's short listeners and viewers. So here's what she writes. An epiphany. I'm flabbergasted, but not surprised. Last summer,

[00:44:01] Klarna CEO announced they were replacing customer service with AI, HR2. They would not need people anymore. I wrote about it. They were replacing one HR vendor with another that's outsourcing, not AI. And the customer views about AI support, spoiler alert, brutal. Six months later, here we are. Nothing will be as valuable as people is what Klarna was saying. Who could have predicted that?

[00:44:27] So yeah. So that's what Anita wrote. Short, pithy. Yeah, that's exactly it. Again, AI is used best when it's in support of people. Not when, again, I use this term. I've read this from other people saying I didn't make this up, but AI fails when it is a solution in search of a problem. That isn't what you do it for. You'd use it to help solve business issues. Not just, yeah, we've got AI.

[00:44:54] Great. That's amazing. Yeah. So that kind of shows, I think it's positive to me because yes, it wasn't the wisest move. It wasn't expressed correctly. The original sort of replacing people with AI. But she leads by saying it's an epiphany. And I think that is interesting to the fact that they

[00:45:19] haven't tried to double down. They said, you know, we were wrong and nothing will be as valuable as people. So that's what we're going to go with. You know, lesson learned. Not great for the people that were affected. But, you know, for those of you that were affected by the Joanne layoffs, the Ceridian layoffs, any of the other sort of negatives, know that some companies are seeing value

[00:45:43] in people and are looking to hire. It's not as bleak as it might seem. I certainly just didn't want to lend on a down note of layoffs. You know, there is value in what you do. And when organizations get through this phase of understanding how best to deploy this new and exciting

[00:46:06] tool, it will result ideally in a better workplace. That's what we're hoping and we'll need all of us working together to make and realize that vision. Well, I couldn't have said any better myself, Cliff. So I mean, I had to smile when I saw this from Anita as well. And I think, no, now, they're getting their name mentioned. I will say that, right? Like good and bad. But it's good for them to learn their lesson. But I think we all saw this. I think this was the arrogance at the

[00:46:34] highest level. We are seeing a lot of arrogance in the market right now around what cost cutting AI, all that can do. I think, you know, it's just a lesson to be watched much like the Joanne Storrs lesson. But yeah, on that note, you know, something to smile about that lessons can be learned. That is where we'll go with that. So, but it's, it's been a great conversation. We're way over today, but that's okay. We're, it's, it's been good to have, have, I think the conversation on a lot of

[00:47:00] topics. I do want to just kind of wrap up today because we are over a little bit to, to let everybody know that, you know, if you didn't have a chance to, to catch up with us, we're always open for questions. If there's comments or places you'd like to us to talk about, please be sure to send Cliff and I the, some notes. And just so you know, because we did get a couple of comments this week about people who were listening to the podcast, let us know. We'd love to hear your feedback. We, it probably makes Cliff and I smile more than anything when someone says, I hear you,

[00:47:26] I listen to you. I, you know, and gives us feedback on, on things that they like or don't like within the show. So that is, is really, really powerful. As we wrap today, just a reminder that if any of the topics that we're talking about, and you're looking at sort of data to make some decisions on as an HR technology organization, or as a business tech organization, trying to make decisions on HR practices, you can find all that in our research report and in our research center. So please be sure to purchase that if you would like to also the new survey will be going public in a few months. So if you are a vendor who is looking to distribute the survey,

[00:47:56] and would like to be or association for an event, any of those things, we, we are always looking for organizations who want to distribute. Please let us know that window will be open for about another month or so. And then we're going to go live with the survey with all of its updates. And there will be a lot of questions just for warning everyone because Cliff and I are working on them about AI in the survey. So just be aware. We've got to get to it. You are all asking about it. We got to make sure we get the data. Be sure to listen to our sister HR huddle podcast.

[00:48:22] HR we have a problem hosted by our CEO, Terry zipper. And if you like these huddle podcasts, please be sure to support, especially in our new environment work defined. It's a great place to be able to put commentary and clicks and likes in there and subscribes. It's a whole group of HR podcasts that you can now participate in. Stay up to date with immediate breaking HR tech news. And to get all the behind the scenes content, you can follow us at sapient insights on LinkedIn and Instagram. And Cliff, thank you as always for putting all this together, pulling all the events that we are going

[00:48:50] to together because I didn't have them all on my list today. Thanks to our production team brand method media group who helps us produce our podcast run by amazing founder Kelly Kelly, our marketing team, Summer Rolano and Sydney Maher. And thanks to our listeners and community. We couldn't do this without you guys or what make this go round. And that's it for this episode of Spill the T on HR tech. We hope it's been just the brew you needed to start the engines running this week. We'll be back in two weeks with another pot of boiling hot HR tech updates and insights. Bye everyone.