While it is widely believed that the inclusion of artificial intelligence (AI) and chatbot software in HR & payroll systems will be a game-changer, most of the hype is coming from providers whose customers typically include large multinational organisations.
But to get an insight into what this technology is likely to mean for small-to-medium enterprises (SMEs), our expert Denis Barnard has been talking to a range of vendors in the space. In the second of a series, he talks to Sue Lingard (SL), marketing director, and John Hixon (JH), director of research & development at CezanneHR, which sells cloud-based HR systems.
Is technology such as AI and chatbots really needed by SME HR & payroll departments, and if so why?
SL Due to the falling cost of HR and payroll software and a recognition that relying on Excel spreadsheets is no way to run a business, there is now a lot of appetite for technologies to help cut admin overheads and improve business efficiency. Chatbots and voice assistants fall into this category.
They can relieve a lot of admin pressure by helping HR with information gathering, perhaps during the onboarding process, or by answering typical every-day questions that employees ask about policies or holiday entitlement. They can even enable staff to ‘ask’ their mobile if they’d like to check holiday entitlement or the latest payslip, request time off or complete a timesheet.
JH HR and payroll departments in SMEs are unlikely to implement the more ‘intelligent’ side of AI as the technology is too expensive and complex to set up. In addition, most SMEs don’t process enough information for an AI tool to get its teeth into.
But things are different for suppliers such as benefit, online training or recruitment portal providers. They have access to huge amounts of data and so are ideally positioned to mine it in order to provide a service to smaller companies – either to help them cut costs or provide a better service to their employees.
When do you predict this technology will become more widely available in the SME space?
SL Sooner than you might think. Technology adoption is accelerating faster than ever before, as is our appetite to make use of it.
I saw an interesting interview with Jeff Bezos recently where he talked about what drove the success of Amazon – and how he’s hoping to replicate that in the space industry. The point he made was that the infrastructure was already in place. Amazon didn’t have to build the internet, set up a delivery service, manufacture goods, or even create demand. It just needed to figure out a way to exploit it.
The same is true for chatbots and, to a lesser extent, some other flavours of AI. The tools exist, the data is available, the delivery mechanism is there and so is the audience. The smart bit will be matching the technology to business needs and delivering it cost-effectively and with a simple enough interface to enable HR, payroll professionals and other employees to simply use it.
Software has until now been dropping in price in real terms and in relation to implementation time and costs. Could this new technology change all that?
SL We are already seeing an explosion of free tools to build chatbots and toolkits that enable existing systems to interface to voice-activated technologies such as Amazon’s Alexa.
While HR and payroll functions are unlikely to have the capacity or expertise to build solutions based on these tools from scratch, there’s no shortage of companies attempting to do so. Since cost to entry is relatively low – and venture capital money seems unlimited here at the moment – we can expect to see a lot of free, or nearly free, HR and payroll solutions coming on the market over the next few years.
At the more ‘intelligent’ end of the AI space, cost and complexity is an issue that’s not going to go away. Instead, we’ll see large service providers embed AI into their products, and offer it as a service to smaller companies. They’ll consume the results rather than having to worry about the technicalities.
Will these technologies require customers to have a better understanding of configuration and system development issues?
JH At the upper end of the AI spectrum where the systems really learn and predict, there is a much higher degree of complexity and a lot of challenges still to overcome, as Microsoft found out when it launched its ‘conversational’ Twitter bot, Tay. It was intended to learn how to interact with other Twitter users by following their example, but in less than 24 hours turned into a ranting, misogynist racist.
And there are plenty of other examples of situations where AI has shown that it’s not to be trusted. It’s a concern that’s reflected in the upcoming General Data Protection Regulation, which specifically addresses the risk of potentially damaging automated decisions being taken about individuals.
How do you expect the SME HR & payroll software landscape to change over the next five years?
SL The challenge is that HR and payroll professionals in this sector are already so swamped that they often don’t have time to figure out how to make the most of their current systems, let alone start experimenting with some of the newer technologies coming to market - unless much of the ground work has already been done for them.
But I think it would be safe to predict that over the next five years:
- We will see a lot of new entrants on the market, a fair number of failures, and a lot of acquisitions;
- Older HR and payroll systems will be ‘retired’ in favour of newer more cost-effective and agile cloud-native ones, not least because they offer employees a much better user experience, which means more accurate information for the business and fewer overheads for HR and payroll;
- Companies in which more than a handful of employees use Excel to manage HR and payroll activities will become the exception rather than the norm;
- Mobile use will continue to grow and employees will expect to ‘consume’ HR- and payroll-related information via increasingly interactive and ‘intelligent’ interfaces, including voice.
Denis Barnard is co-founder of, and lead consultant for, niche HR and payroll technology consultancy HRmeansbusiness Ltd. In 2009, he also set up the UK’s first comparison website for HR information systems, HRcomparison.com. Denis has likewise published book entitled ‘Selecting and Implementing HR and payroll software’, with the aim of demystifying the process and ensuring readers make the right selection decisions for them.
While it is widely believed that the inclusion of artificial intelligence (AI) and chatbot software in HR & payroll systems will be a game-changer, most of the hype is coming from providers whose customers typically include large multinational organisations.
But to get an insight into what this technology is likely to mean for small-to-medium enterprises (SMEs), our expert Denis Barnard has been talking to a range of vendors in the space. In the second of a series, he talks to Sue Lingard (SL), marketing director, and John Hixon (JH), director of research & development at CezanneHR, which sells cloud-based HR systems.
Is technology such as AI and chatbots really needed by SME HR & payroll departments, and if so why?
SL Due to the falling cost of HR and payroll software and a recognition that relying on Excel spreadsheets is no way to run a business, there is now a lot of appetite for technologies to help cut admin overheads and improve business efficiency. Chatbots and voice assistants fall into this category.
They can relieve a lot of admin pressure by helping HR with information gathering, perhaps during the onboarding process, or by answering typical every-day questions that employees ask about policies or holiday entitlement. They can even enable staff to ‘ask’ their mobile if they’d like to check holiday entitlement or the latest payslip, request time off or complete a timesheet.
JH HR and payroll departments in SMEs are unlikely to implement the more ‘intelligent’ side of AI as the technology is too expensive and complex to set up. In addition, most SMEs don’t process enough information for an AI tool to get its teeth into.
But things are different for suppliers such as benefit, online training or recruitment portal providers. They have access to huge amounts of data and so are ideally positioned to mine it in order to provide a service to smaller companies – either to help them cut costs or provide a better service to their employees.
When do you predict this technology will become more widely available in the SME space?
SL Sooner than you might think. Technology adoption is accelerating faster than ever before, as is our appetite to make use of it.
I saw an interesting interview with Jeff Bezos recently where he talked about what drove the success of Amazon – and how he’s hoping to replicate that in the space industry. The point he made was that the infrastructure was already in place. Amazon didn’t have to build the internet, set up a delivery service, manufacture goods, or even create demand. It just needed to figure out a way to exploit it.
The same is true for chatbots and, to a lesser extent, some other flavours of AI. The tools exist, the data is available, the delivery mechanism is there and so is the audience. The smart bit will be matching the technology to business needs and delivering it cost-effectively and with a simple enough interface to enable HR, payroll professionals and other employees to simply use it.
Software has until now been dropping in price in real terms and in relation to implementation time and costs. Could this new technology change all that?
SL We are already seeing an explosion of free tools to build chatbots and toolkits that enable existing systems to interface to voice-activated technologies such as Amazon’s Alexa.
While HR and payroll functions are unlikely to have the capacity or expertise to build solutions based on these tools from scratch, there’s no shortage of companies attempting to do so. Since cost to entry is relatively low – and venture capital money seems unlimited here at the moment – we can expect to see a lot of free, or nearly free, HR and payroll solutions coming on the market over the next few years.
At the more ‘intelligent’ end of the AI space, cost and complexity is an issue that’s not going to go away. Instead, we’ll see large service providers embed AI into their products, and offer it as a service to smaller companies. They’ll consume the results rather than having to worry about the technicalities.
Will these technologies require customers to have a better understanding of configuration and system development issues?
JH At the upper end of the AI spectrum where the systems really learn and predict, there is a much higher degree of complexity and a lot of challenges still to overcome, as Microsoft found out when it launched its ‘conversational’ Twitter bot, Tay. It was intended to learn how to interact with other Twitter users by following their example, but in less than 24 hours turned into a ranting, misogynist racist.
And there are plenty of other examples of situations where AI has shown that it’s not to be trusted. It’s a concern that’s reflected in the upcoming General Data Protection Regulation, which specifically addresses the risk of potentially damaging automated decisions being taken about individuals.
How do you expect the SME HR & payroll software landscape to change over the next five years?
SL The challenge is that HR and payroll professionals in this sector are already so swamped that they often don’t have time to figure out how to make the most of their current systems, let alone start experimenting with some of the newer technologies coming to market - unless much of the ground work has already been done for them.
But I think it would be safe to predict that over the next five years:
- We will see a lot of new entrants on the market, a fair number of failures, and a lot of acquisitions;
- Older HR and payroll systems will be ‘retired’ in favour of newer more cost-effective and agile cloud-native ones, not least because they offer employees a much better user experience, which means more accurate information for the business and fewer overheads for HR and payroll;
- Companies in which more than a handful of employees use Excel to manage HR and payroll activities will become the exception rather than the norm;
- Mobile use will continue to grow and employees will expect to ‘consume’ HR- and payroll-related information via increasingly interactive and ‘intelligent’ interfaces, including voice.
Denis Barnard is co-founder of, and lead consultant for, niche HR and payroll technology consultancy HRmeansbusiness Ltd. In 2009, he also set up the UK’s first comparison website for HR information systems, HRcomparison.com. Denis has likewise published book entitled ‘Selecting and Implementing HR and payroll software’, with the aim of demystifying the process and ensuring readers make the right selection decisions for them.
