Translated by
2019/10/08 11:17:49

Russian market of HRM systems

Article is included into the overview of TAdviser of HRM 2019

Content

2018 - 2019

Situation in the market

The Russian market of personnel management systems at the end of 2018 showed positive dynamics at the level of 9%. According to TAdviser, market size increased to 19.4 billion rubles.

HRM market 1519.png

Results of activity of market participants which revealed TAdviser revenue from HRM projects and also comments of experts in general confirm market direction. At the same time representatives of the companies – vendors and integrators of HRM systems – disagree concerning activity of growth of the market and its reasons.

«

The market is in a status of slow growth. The agiotage with HRTech startups and new technologies begins to pass, some new solutions gradually begin to be applied in broad practice, - Alexey Korolkov, the CEO of Websoft notes.

»

«

In recent years we observe stable market growth of HRM systems. We consider, it is caused by requirement of the companies to receive the effective solution which is most answering to specifics of business and the organization of work of employees. In the conditions of the increased requirements to specialists, information systems (in particular HRM systems) due to convenient and simple services in use remove a share of load of HR specialists and allow to use human resources most effectively, - the commercial director Monolit-Info Alexey Zhigulev says.

»

Kirill Dyakov, the managing partner of Mirapolis, reminds that the market of HRM is divided into two most parts. The first is connected with accounting and settlement functions (payroll, holidays and business trips, awards and compensations) and also conducting personnel office-work. The second treats increase in efficiency of personnel and covers such processes as management of personnel recruitment, adaptation and training, efficiency evaluation and potential, planning of personnel succession and development of personnel potential, organizational engineering and planning of number. At these fields of the market different degree of a maturity, a trend of development and volumes.

If to speak about the second part of the market connected with personnel management process automation, then, according to Kirill Dyakov, in 2018 and 2019 growth first of all due to the first implementations and replacement which are earlier used separated solutions on complex, the processes and to obtain earlier unavailable data arising on joints of different processes allowing both to optimize is observed.

«

This market is in a stage of active growth, every year the number of the implemented projects grows. It is possible to tell with confidence that this market will show good indicators of growth every year on an extent of, at least, 5-6 years. At the same time the gain will be reached due to the first implementations, but not the substitutions which are earlier implemented, - the expert of Mirapolis believes.

»

According to Andrey Filatov, the CEO of SAP CIS, in the market of the Russian HR there was a double situation. On the one hand, the increasing value is purchased management practice by HR data and by high-quality HR processes. The companies cease to perceive personnel management systems as the automation equipment of specific processes and pass to their application for quality improvement of a HR system in general. This trend gives rise to demand for the integrated cloud management systems for talents.

At the same time, the Talent Management systems existing in the companies not always provide necessary quality of a feedback, involvement and motivation of employees, Maxim Ryabov, the CEO of Goodt says.

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With respect thereto the dissatisfaction of customers in questions of talent management is felt. Today the automated systems providing forecasts of departure of employees, the recommendations of professional development and routes of career development are necessary for heads, - he adds.

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On the other hand, according to Andrey Filatov, understanding and understanding by the companies of services and applications using artificial intelligence, Big Data and new interfaces is more and more traced (chat-bots, etc.).

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The majority of such systems promising radical revolution in HR alas, yet did not show the promised results. At the same time large corporations adopt the most perspective technologies now and turn them into full-fledged products with clear functionality. In particular, process of consolidation of the market of HRM tools and services to which large local players come is connected with it, - the CEO of SAP CIS says.

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One more important factor which will continue to have an impact on this market is import substitution of foreign software in state corporations, state agencies and the companies with state participation.

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They under the influence of policy in this area and on some other the reasons will migrate from foreign software on the Russian solutions or own developments. A number of the largest state companies already began preparation for migration of a part of earlier implemented functionality on performance management of personnel with the western software, - Kirill Dyakov tells.

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Evgeny Kuchik, the CEO of BOSS. Personnel systems, adds that in case of substitution of earlier implemented HR system customers expect more wide functionality.

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Customers needs in such situation became far more grandiose. Any does not want to lose in a new system though something that was in old, but expects to receive the mass of the added values. And this trend will only accrue, he considers.

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Also It should be noted that for the last year in the market the sharp growth of interest in the integrated cloud management systems for talents from medium and small business began to be traced brightly, including in regions. Such trend is noticed, in particular, in SAP.

At the same time in Molga Consulting, note that thanks to clouds, implementation cost fell, and now these solutions became available to the SMB-companies.

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Cloud solutions on personnel management in the short term will occupy a big market share, - Evgeny Vasilyev, the senior partner of Molga Consulting believes.

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Revenue of market participants and the biggest customers


Revenue of the Russian companies from HRM projects in 2017-2018 and the forecast of revenue for 2019

|3||ГК ABC (Solutions)||вендор||198||33||165||style="background:#CC0000;color:white;"|' 375||125||250||89,4||459||22,4|4||Mirapolis||вендор||257||76||181||style="background:#CC0000;color:white;"|' 368||136||232||43||470||27,7
' №' Company Status Revenue from the HRM projects for 2017, million rubles, with the VAT including from sale of licenses including from implementation services and support Revenue from the HRM projects for 2018, million rubles, with the VAT including from sale of licenses including from implementation services and support Loudspeaker 2018/2017, % The forecast of revenue at the end of 2019. The predicted dynamics at the end of 2019, %
1Molga Consultingintegrator1,108-1,108' 1,114'51,1090.5N / dN / d
2EVOLAintegrator316-316379-379204087.5
5NORBITintegrator10848.659.4' 132'59.472.622270104.5
6Monolit-Infovendor4083244638105218.2
' 'TAdviser 2019
' '

The biggest customers / projects of the Russian companies in the HRM direction in 2017-2019

Company The biggest customers / projects in 2017-2019
Molga ConsultingRosatom, Transneft, Sberbank, Norilsk Nickel, Rosneft
EVOLANovolipetsk Metallurgical Combine, Norilsk Nickel, Gazpromneft, M.Video, Metalloinvest, Sibur
ABC (Solutions) GroupAlfa-Bank, Leroy Merlin, Yves Rocher, Sportmaster, Samsonite, Shell, METRO Cash&Carry, MTS Retail network, Sberbank, Rostelecom, VimpelCom (Beeline), Inventive Retail Group (Lego, Nike, Street Beat, UNOde50, Sony Centre, Samsung, re: Store), VTB 24, Russian Post, Magnet, Ostin, Lukoil, Aeroexpress
MirapolisRussian Post, FGC UES, Russian Railway, Cherkizovo Group, X5 Retail Group
NORBITSberbank, Polyus Gold, NLMK, UCL, Russian Post
Monolit-InfoBaltika brewery
SAP CISMegapolis Group, OMK, EVRAZ, Inventive Retail Group, PhosAgro, Decathlon|Decathlon, Auchan, Kaspersky Lab, NLMK, Sberbank, Aykraft, Velesstroy, Otkrytiye Bank, Rusagro, VTB, Deloitte, Splat
WebsoftRostelecom, VTB Group, Rosneft, Rosatom, Central Bank of the Russian Federation, Alfa-Bank, X5, Gazprombank, Otkrytiye Bank
' 'TAdviser 2019
' '

Drivers and barriers

Drivers

One of the main drivers of the Russian market of HRM is the problem of increase in process performance of personnel management. It, according to Kirill Dyakov, the managing partner of Mirapolis, will stimulate further the companies to implement systems allowing to approach most in a complex an issue of automation of HR processes.

Anton Chekhonin, the CEO of NORBIT, adds that the Russian business wishes to increase personnel performance, to reduce costs for its contents and also to provide the corporate compliance including correct work with personal data, drawing up the code of corporate ethics, justification of termination of labor contracts, transparency of the movement on grades, etc.

One more important driving factor is the trend on a didzhitalization in all spheres including in personnel management.

«

Most of representatives of the HR sphere well understand that creation of modern, effective and competitive personnel management processes is impossible without automation system meeting the modern requirements. The younger generation of employees imposes new high requirements which should be taken into consideration at start of projects of automation of HR to corporate systems, - Kirill Dyakov notes.

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According to the commercial director Monolit-Info Alexey Zhigulev, serves as the generator of development of HRM systems as well the accelerated development of technologies opening new opportunities for further improvement of properties and qualities of systems.

Besides, permanent development of HRM systems, expansion of their functionality and emergence of new services are influenced by frequent changes in federal laws in questions of personnel office-work, the tax law, implementation of electronic services in work of state bodies and other areas

Maxim Ryabov lists some more factors of market development:

  • deficit of a human resource;
  • increase in demand for skilled staff;
  • need for creation of own centers of training of personnel since high school training not always copes with a task;
  • learning process in connection with srosty technologies becomes continuous since there is a strong obsolescence of positions.

Barriers

It is possible to carry an insufficient maturity of business processes in the field of personnel management to barriers of the market. Often the management of the companies pays a maximum of attention and funds for development of the main production directions, and the functions which are considered for them "providing", including HR, develop by the residual principle.

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For example, in a root there are no separate processes on talent management as an automation object, - Anton Chekhonin, the CEO of NORBIT notes.

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Also it carries the low level of IT literacy of staff of the Russian enterprises to barriers, especially in regions.

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In the Russian companies still there are employees preferring to work "in the old manner": print paper summaries, do not plunge into a context of modern digital culture ("likes", chat-bots, telegrams channels, services of self-service) and have negative attitude to it in general, - the CEO of NORBIT says.

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Also Evgeny Vasilyev, the senior partner of Molga Consulting holds the similar opinion. He considers that barriers mostly are psychological as the business which did not follow a way of digitalization can perceive innovations in bayonets.

Kirill Dyakov, the Managing partner of Mirapolis, carries the general economic situation and lack of significant economic growth to restraining factors that constrains the investment volume of the companies into solutions for automation of those processes which have not an explicit impact on financial performance and have the postponed economic effect.

Additional barrier - "scrappy" automation. Most often the Russian companies have no complex strategy of digital development of the HR direction or the budget on implementation of such strategy.

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It turns out that control functions by selection, assessment, a talent pool are implemented out of target strategy as separate elements using different platforms and during the different time periods. It sharply reduces efficiency of use of a HRM system as complete product, - Anton Chekhonin considers.

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Besides, rather small volume of the local market of HR systems and the complicated access of the Russian companies to foreign investments does not allow domestic developers to create cloud HRM solutions of new generation, especially, if it is about digitalization of processes of management of talents, Andrey Filatov, the CEO of SAP CIS says.

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For the same reasons (rather small size and relative closeness) most of the international producers of HRM solutions do not make the strategic investments in the Russian market. SAP, in this case, is an exception of this rule and is going to develop and invest in the Russian market further, - he adds.

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At the same time, the import substitution obligatory for many solvent companies, strongly limits the choice of solutions for automation.

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Unlike ERP, CRM and BPM- solutions where domestic developments stand in the same row with foreign. The Russian HR solutions, for example, from 1C, place emphasis on personnel administration and, partially, personnel training, and there are practically no full-fledged analogs for talent management, goal-setting and performance appraisal and HR analytics, - Anton Chekhonin considers.

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It is possible to carry to obstacles of market development also complex, and at times outdated UI design of systems.

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Top management and middle managers are hardly involved in work in systems with obsolete interfaces. In HR systems constructed based on the accounting systems existing in the company, work, as a rule, takes away a lot of time: to perform one operation, it is necessary to be introduced into several screens, to enter some data, etc. Role jobs (for heads, the staff of HR, top management) should be provided where all information necessary for it and analytics is consolidated in modern solutions, - the head of NORBIT explains.

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Innovations of HRM systems

In August-September, 2019 TAdviser conducted survey of participants of the Russian market of HRM systems and learned what innovations appear or can appear in similar solutions in the nearest future. Experts already spoke about a part of such innovations a few years ago. However now similar technologies gain bigger development and wider scopes of application.

Robotization of HR processes

So, according to experts, recently much attention is paid to robotization of different processes (RPA, Robotic Process Automation).

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In personnel recruitment begin to use robots for call-down of candidates and holding a video interview more and more that without participation of the recruiter to do primary selection by different criteria and at the exit to process already only those who approach and are ready to work at terms offered by the company, - Kirill Dyakov, the Managing partner of Mirapolis tells.

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Anton Chekhonin, the CEO of NORBIT (Lanit Group), adds that the RPA technology is also used in intellectual search and automatic selection of the summary and also for carrying out exit interview.

Evgeny Kuchik, the CEO of BOSS. Personnel systems, considers that robotization of HR processes is very important.

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If a system can undertake completely functions of the personnel officer – to initiate, provide, check on correctness and speed of execution, to enter a total upon termination of processes in accounting registers, to create, publish and direct required documents on the course and a result of HR process – that in such environment the personnel officer is not necessary at all, - he notes.

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Artificial intelligence

The technologies connected with artificial intelligence, according to Kirill Dyakov, begin to apply in personnel recruitment when the systems of selection train to define the most suitable candidates for further implementation of search in the semiautonomous mode. Besides, the first attempts to use artificial intelligence in the field of training that systems allowed to define the most effective ways of development and to find profiles of the most effective employees are made.

Anton Chekhonin adds that within adaptive training a system can analyze indicators of employee ability to training and offer a training material in the adapted individual format. Further the efficiency of the employee on competences which are required to be developed by training programs is analyzed and taking into account it training programs for other employees form.

According to Evgeny Kuchik, the artificial intelligence in HR work can be widely demanded, but later when the maturity of such products for a segment of HR is reached. Now, according to him, there passes the stage of experimental search of really demanded tasks.

Voice and chat-bots

Voice and chat-bots of the company begin to implement for internal services. Order the reference, copies of documents, it is already possible to organize a business trip without communication with the living employee, all this becomes via the robot.

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Further the trend of substitution of the person robots in the clear, giving-in to algorithmization transactions will only amplify, - Kirill Dyakov considers.

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Analysis of Big Data and predictive analytics

One more innovation is connected with accumulation of large volume of data on employees and their further use in solving of tasks in the field of human capital management on the basis of predictive models. These models are under construction using machine learning and statistical techniques on the collected volumes of historical data, identification of the hidden dependences and templates of behavior of personnel.

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So systems allow to predict future events in the field of personnel and their influence on performance of the company. For example, such systems will help to predict performance penalties of personnel in connection with loss of loyalty and burning out, to identify the burning-out employees and to prevent it process. They will help to find the employees, the most subject to risk of leaving and to timely take measures for deduction, increase in their involvement and satisfaction, - the managing partner of Mirapolis Kirill Dyakov tells.

»

According to the CEO of NORBIT Anton Chekhonin, the analysis of Big Data and predictive analytics are widely used in processes of determination of probability of dismissals, forecasts of personnel turnover, solving of tasks of increase in accuracy of goal setting and so forth.

Gamification

New approaches to motivation and involvement are in many respects dictated by features of perception of information by new generation.

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The generation Z not only does not perceive information from Excel, but also does not perceive what simply is not interesting. The new generation "will not lease itself" for operating time, executing what is not pleasant to them. Therefore the most important task of the employer to motivate and involve employees, translating working tasks from language of strict rules and Excel on language of gamification and attractive intuitive interfaces, - Maxim Ryabov, the CEO of Goodt believes.

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As Anton Chekhonin notes, gamification includes the game methods directed to increase in the involvement and efficiency of employees and promote effective team building.

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Most often such applications are intended for employees by age no more than 35 years ready to perceive information in playful way. Today this technology are widely applied in the companies with mass personnel - large retail chain stores, banks and insurance companies. The most popular HR sphere where gamification – management of motivation is used, - the expert says.

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Statistics of the market

As of September, 2018 the TAdviser base contains information on 2832 implementation projects HRM. More than a third from them are implementations of HR systems 1C, mainly solutions "1C: Payroll and HR Management" and "1C: Payroll and a budget institution staff". For the entire period of observations of TAdviser were implemented into the five of vendors, whose HRM systems most often, the companies "Compass", "Galaktika", SAP and BOSS. Personnel systems also enter. The share of their solutions exceeds 76% in a total amount of HRM projects of TAdviser base.

HRM stat 0519.png

If to consider statistics of projects of TAdviser base in recent years, then here distribution a bit different. In 2017-2019 is more often than others solutions 1C (1C: Payroll and HR Management), SAP (SAP HCM and SAP SuccessFactors), were implemented by Antegra Consulting (Antegra: Salary and personnel management of credit institutions) and WebSoft (WebTutor).

2016 - 2017

Market assessment - data of TAdviser

According to TAdviser, the volume of the Russian market of personnel management systems (software and services) at the end of 2016 reached a point in 16.5 billion rubles, having shown small dynamics of growth. In 2017 in the market some revival of participants both in the field of basic processes of personnel, and in the field of performance management processes of personnel and means of service of workers/heads was observed. Despite it, serious increase in dynamics at the end of 2017 did not happen – market size, by a preliminary estimate of TAdviser, did not exceed 17 billion rubles. And dynamic 2018 can become more interesting.

Respondents of TAdviser experts also notice the signed movement '+'. However, they are more optimistic in the estimates and forecasts. For example, Alexander Shishilov, the chief of the Center of automation of personnel management systems EAE-Consult, noting growth of the market and emergence of a set of new offers in 2016-2017, adds that at the end of 2016 dynamics reached about 15-20%, and in 2017 it is estimated at the level of 7-10%.

Sergey Nikitin, the partner in MOLGA Consulting company, also says that 2016 and 2017 - year of increase in demand for HRM systems, and both in classical, and in the innovation products. At the same time, according to him, average annual dynamics of growth in 2016 was about 15%, in 2017 - dynamics similar or is a little higher.

Such optimism can be explained with growth of revenue of EAE-Consult and Molga Consulting companies from HRM projects at the end of 2016. Indicators of the first grew by 16.8%, the second – for 20.9%.

According to Mikhail Kuzminov, the director of HR consulting of Corus Consulting Group, in the market growth will continue, and dynamics of sales of modern HR solutions will only be to increase, first of all, at the expense of modern solutions — WFM and systems for talent management.

According to Alexander Shishilov, regarding basic processes the start of the projects postponed in 2014-2015 on a rollout of the created solutions, on development of functionality is observed (for example – planning of PHOTOS and VSH, improvement of quality of the reporting, ensuring compliance to new statutory requirements according to tax statements). In connection with the new requirements on 6-NDFL questions on substitution of deeply customized funds of payroll and formation of tax statements for the standard solutions supported on a centralized basis by vendor are particularly acute also enough.

Besides, regarding management tools efficiency of personnel and means of self-service, he notices interest in use of ready-made solutions, for example, such as SAP SuccessFactors. Customers consider as the value and the compulsory provision of the choice of a product - the good user experience level provided by vendor in basic delivery and also ready options of implementation of processes, Shishilov says.

Sergey Nikitin considers that the market of HRM systems endures rapid growth, the great demand both for classical solutions, and for the innovation, for example, cloud is observed.

«
Russia is included into the period of a potential demographic hole therefore search, deduction of talents, employee development become priorities for any company. Also the generation changes, comes to the companies more and more young people born during an era of the Internet and, as a result, demand for light, available, easily adaptable technologies grows, - he notes.
»

Victor Nikitin, the director of the product Bpium, believes that the market is at a stage "both managed, and made".

«
Personnel departments of large business work on the systems of times of the USSR. Such systems are under construction on heavy software and library of regulations for which not personnel officers, and IT department of the Soviet sample are responsible. A modern method — services of the websites for search of candidates, but they are primitive. These are rather assistants in a personal account of the account, but not the independent systems. Enthusiasts to eychara should create own information environments based on ekselya. There is no system which completely will arrange information flows of HR department. The attention of developers, marketing specialists and business coaches is concentrated on sales and management. Eychar for them in an outside. Personnel officers reconciled to such situation, everything suits them, - he considers.
»

Evgeny Kuchik, the CEO of BOSS. Personnel systems, in an interview of TAdviser shared the forecast for 2018:

«
It seems to me that 2018 will be year not that of a boom, but at least growth – all stiffness of the market which took place in recent years after all will begin to fall down. It is not necessary to wait for a god-send, of course, our market is still occupied, at all enterprises there is some automation equipment. But now, apparently, many companies, at last begin to look for – to look for more best solution, than is at them. And what is important, there is a feeling that this search not academic, the companies aggregate purchasing budgets. Of course, will be not just still because now any cycle of sale-purchase long and heavy, and another as in days of old, any more will not be. Customers select consciously, very deliberately, estimate the solution comprehensively, will change "a pricker on soap" nobody. Criterion one – real return from change of systems. I think that 2018 will be much more interesting and dynamic.
»

Drivers and barriers

Drivers

The main driver of the market of HRM is the global problem of increase in efficiency of personnel which in the conditions of the current market situation, according to Artem Akopov, the partner of Molga Consulting, faces most the Russian companies.

The second important driver, according to him, this increase in skill level of HR services for which a HRM system becomes the tool for the solution of harder and harder and extraordinary tasks.

Maxim Uvarov, the head of the HRM direction of Informkontakt company (Alfa System), considers that the driver of the market is understanding of a role of HR in growth of efficiency of the company, and, as a result, relevant requirements to IT systems.

«
Already it is not enough to keep "posthumous" account, tools of the organization of productive activity are necessary. Management of work both in terms of competences, and in terms of job management, up to shop level – a basis of the personnel systems of tomorrow. But, alas, to pass to new models of work, organizational changes are necessary, and it requires great efforts, - he says.
»

Alexander Shishilov, the chief of the Center of automation of personnel management systems of EAE-Consult company, notes that regarding performance management processes and means of self-service of workers and heads, the driver is objective requirement to use of the wide potential of modern tools by the organizations. At the same time, regarding basic processes of personnel management the main driver of development, according to him, is gain and complication of requirements of the legislation and also requirement of the organizations for optimization of labor costs on execution of operational HR processes.

According to Mikhail Kuzminov, the director of HR consulting of Corus Consulting Group, drivers somewhat follow that the market forms.

«
There is not a lot of competitors, and the interest of customers grows therefore recently at the young companies interest in the market of HR systems is traced, - he says.
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Victor Nikitin, the director of the product Bpium, the main driver entitles as "There is no experience".

«
The situation is similar to mobile communications market of the 90th years. Then in Russia nothing was: the technology began to develop on the most advanced technologies and iron at once. Therefore now at mobile communication such high extent of penetration in our country. In Europe on the contrary: old infrastructure was, but its expensive upgrade slowed down development. In the same HRM: the lack of experience allows to implement the advanced solutions, - he considers.
»

Barriers

Experts of the market carry the level of knowledge of the persons making decisions, a maturity of corporate culture of the organizations and also readiness for transformation to number of barriers.

According to Alexander Shishilov, an additional barrier is the sanctions policy which creates undesirable risks in case of application of cloud solutions and foreign technologies in general.

Mikhail Kuzminov from Corus Consulting considers that it is difficult to foreign players to work in Russia, and domestic solutions are still not enough.

«
Developers did not consider it as perspective and therefore there is not a lot of really qualitative and mature solutions. It is possible to tell that this market only forms, - he says.
»

Artem Akopov, the partner of Molga Consulting, a barrier of the market calls low readiness of Information Security Services for transition to the cloud or widely integrated HRM systems because of a concern of loss of the personal data which are strictly protected by regulations of the Russian legislation.

Victor Nikitin sees the main barrier of the HRM market in lack of an opportunity for clients to compare a situation in the company before use of the solution.

«
Without the user experience it is difficult to entrepreneurs to carry out comparison "to/after". But the barrier will break in process of accumulation of experience, responses of business speakers and references in media. On it will leave one or two years, - the expert considers.
»

As the Russian market of HRM within the next 5 years will change

The Russian experts of the market of HRM consider that in the next years the big market share will be occupied by cloud solutions. Also they expect expansion of a line of the Russian systems and broad development of forecast models on the basis of BigData.

Implementation of cloud solutions will help to reduce costs for implementation of HR systems and also time necessary on such project is noted by Mikhail Kuzminov, the director of HR consulting of Corus Consulting Group. According to him, the world goes to that everywhere there was agile and all need to change quickly to get on well at a competitive race.

Artem Akopov, the partner of Molga Consulting, believes that cloud HRM solutions in the next 5 years will win big percent of the market. At the same time they will turn on not only the processes connected with search, development and deduction of personnel but also the processes which are strictly regulated by the legislation such as personnel records and payroll.

Alexander Shishilov, the chief of the Center of automation of personnel management systems EAE-Consult, expects decrease in barriers to use of cloud means, both psychological, and sanctions.

Mikhail Kuzminov adds that together with clouds, very great influence on the market will be had by robotization and digital transformation. All these processes, according to him, will allow to reduce strongly work of specialists and quantity of sample tasks for employees.

«
Many companies begin to understand — competently to manage personnel including using IT solutions it is very important now. Russia is waited by a number of changes, such as demographic hole. In this case, need to find effective employees very strongly increases, - he explains.
»

Together with growth of popularity of cloud solutions broad development will receive creation of the forecast behavior models of the person based on data collection from different sources of BigData (browsers, social networks, trackers, etc.), Artem Akopov is sure.

«
Thus, data which were traditionally used by marketing services for the analysis of audience and setup of advertizing will be on service of HR divisions for employee analysis and effective management of personnel, - he considers.
»

Alexander Shishilov, in addition to decrease in barriers to use of clouds, hopes for development of a line of the Russian solutions which will create the competition to the western analogs. Besides, he he considers that the Russian market in the next 5 years is expected by standardization and complication of the automation equipment of basic processes, many projects in this area will be respectively executed.

Victor Nikitin, the director of the product Bpium, answering the question "as the Russian market of HRM within the next 5 years will change", noted that "the market of HRM will not be".

«
Business needs not HRM, but control levers, increases arrived also cost reductions. There will be a market of professional BI consulting where the agencies propose individual solutions for business. Solutions will be under construction on experience of the agency and the software of different vendors. At the same time those vendors which have in a portfolio of the solution not only on HRM, but also on marketing, sales, management and PR will be the winner, - he believes.
»

What developers of HRM systems and what innovations aim at wait customers

Developers aim to improve perceptions of a HRM system by the ordinary user, to provide execution of statutory requirements and to facilitate process of implementation and work with the solution.

Artem Akopov, the partner of Molga Consulting, considers that first of all, developers are focused on a usability and improvement of perception of a system by the user as focus of development of the HRM systems moved from their use by especially professional users to each employee of the organization to whom simplicity of work and availability from any device is important.

Alexander Shishilov, the chief of the Center of automation of personnel management systems of EAE-Consult company notes that regarding basic processes developers of HRM systems aim to provide execution of requirements of the legislation with maximum speed.

«
It is proper response to expectations of the customer which want to hand over the regular reporting without stresses and with minimum risks, – he says.
»

As for developers of the HRM systems of advanced functionality, according to him, they aim to provide to the customer the ready-made solution without the need for months-long study of technical tasks.

According to Maxim Uvarov, the head of the HRM direction of Informkontakt company (Alfa System), decrease in total ownership cost as nobody wants to do a huge number of settings "under himself" interests all, and then to receive "a suitcase without handle" – a system which too expensive to accompany, and it is a pity to throw.

«
High-tech solutions with ready management models which can easily adapt to the changing conditions and grow behind the enterprise are necessary. In spite of the fact that such solutions it is much more difficult in development, their service upon costs cheaper, – he explains.
»

Mikhail Kuzminov, the director of HR consulting of Corus Consulting Group, adds that developers of HRM systems aim to go to a cloud format as it helps to standardize a system and to avoid the difficult monolithic decisions.

«
In other words, vendors would like to issue the standardized solutions that customers arranged under them the processes, – he notes.
»

Evgeny Kuchik, the CEO of BOSS. Personnel systems, adds that the big distributed organizations place orders for automation of separate HR processes with an emphasis on the total involvement into them of all personnel.

«
Often it is some processes, specific to the client, but in general it is clear that the market moves in this direction, – he explains.
»

Besides, according to him, there was separately an interest vector connected with tasks of BMS – Bonus Management System, control automation by motivation.

«
For many today it becomes a vital necessity, the efficiency of the company is always connected with motivation. In the big organizations processes of management of rewards plans, compensating circuits are extremely difficult and labor-consuming. Obviously, the market request for BMS functionality is, – Evgeny Kuchik tells.
»

Victor Nikitin, the director of the product Bpium, believes that developers of HRM systems got stuck in interfaces the 90th and personnel regulations of the USSR.

«
Modern business needs a simple, mobile, cloud service which will close routine tasks of HR. Each business needs accounting: base of candidates, the summary, a carrying out stage from the status "candidate" to the status "worker". Accounting of merits and advanced training is necessary. Therefore the market waits for mass easy solutions, but not heavy software, with difficult infrastructure, pieces of iron and IT specialists, – Nikitin considers.
»

As for customers, easy, fast solutions for installation which implementation does not take year and more are interesting to them. In addition, they wait for qualitative user design, fast effect of implementation, fast reconfiguration, etc. the Products focused on the speed and showiness appear as a rule in a priority.

Top-5 vendors and Top-10 of contractors of HRM systems

As of December, 2017 the TAdviser base includes information almost about 2.8 thousand HRM projects. About a third from them is the share of implementations of HRM-1C systems, first of all, it is "1C: Payroll and HR Management" and "1C: Payroll and a budget institution staff".

According to data of TAdviser base, in addition to 1C, the five of vendors whose HRM systems are implemented most often, also includes the companies "Compass", "Galaktika", SAP and "BOSS. Personnel systems".

Solutions of these five companies are used approximately in 75% of all HRM projects which are in TAdviser base.

As for contractors of HRM systems, in the top ten of the companies on the number of projects, four positions belong to partners of 1C. According to data of TAdviser base to fall to their share nearly a half of all implementations of Top-10.

2013

According to own data of TAdviser, the Russian market of HRM systems and related services on their implementation in 2013 did not show essential dynamics of growth, having recorded in volume at the level of previous year – about 15-16 billion rubles. The overall picture in the market of HRM systems was quite stable, without negative sign, but also at the same time without any essential motions forward.

* Data for 2014 are provided the forecast

The same trend is reflected also by filling of own base of projects of implementations of the TAdviser Center. Though in it are brought only public and largest projects of implementations, dynamics to the market filling of base reflects pretty well. And if in one and a half years by March-April, 2013 the base of implementations increased by 2.5 times to 1.8 thousand projects, then a year later, by April, 2014, only for 16.5% up to 2097 projects. From them by 2012 402 projects, belong to 2013 – 145.

Such stagnation has a number of the reasons. From different classes of business software of the HRM system regarding payroll and personnel records have one of the highest penetrations in the Russian business and a public sector. In a segment of large business, by estimates of TAdviser, 100% of the companies, and in a segment of medium business – up to 80% use such systems, among the companies of small business the automated payroll calculation is used by every third firm.

Thus, the market of HRM actually exhausted opportunities for extensive growth, and for intensive did not save up due potential yet. The heavy industrial HRM systems which are offered in the market (SAP, Oracle, Galaktika, Compass and others) do not find demand owing to excess functionality and relative high cost in a segment of average and especially small business. HRM from "cloud" could meet the most budget demand, but before maturing of this segment in Russia still there will pass two years and more.

On the other hand, the large vendors offering powerful HRM platforms could implement deeper and difficult projects on implementation of HRM systems appearing for a frame of settlings with employees and personnel records, human capital managements, closer to methodology (human capital management, HCM – though is often used as a synonym of HRM, but nevertheless in fact wider concept), but demand for such projects for the present very low: are ready to invest in a human capital no more than 3-5% of all potential customers.

By estimates of TAdviser, in the Russian market in terms of money remain the largest vendors of HRM systems SAP and 1C, in total not less than 50% of volume of the Russian market of HRM are the share of them (including the income of partners from implementation of systems and consulting). In quantitative expression by the absolute leader in number of implementations there is 1C: in total based on the different solutions and platforms developed by the company in Russia about 137 thousand projects, separately on the 8th platform – about 90 thousand implementations are implemented. In 2012 the franchisee of 1C implemented 23.9 thousand projects of implementations based on HRM systems from 1C (1C: Payroll and HR Management 8 1C: Payroll and HR Management 8 CORP and others), in 2013 - 18.6 thousand projects.

As for shares of vendors in the Russian market of HRM, there are here traditional difficulties with its determination as many installations of HRM solutions are a part of ERP projects and are as appropriate considered in base of projects TAdviser. Nevertheless, the analysis of base allows to call for all history of observations unambiguously the HRM platforms with the largest weight in Russia: "1C: Payroll and HR Management 8", "Compass: Personnel management", "Galaktika ERP: Guidance loop personnel", "BOSS-personnel officer" and SAP ERP of HCM.

Among system integrators on the number of projects in 2012-2013 franchisees 1C, including First BIT, 1C-Rarus, "1C:VDGB" and others are considerably selected. On total revenue from HRM projects in the Russian market IBS, Molga Consulting, Borlas, EVOLA, Galaktika Corporation, EAE-Consult, NORBIT and others are in the lead.

Revenues of system integrators in the market of HRM in Russia, 2012-2013, thousand rubles

Company Income 2013, thousand rubles Income 2012, thousand rubles Revenue growth 2012-2013, %
1

|IBS*

830 800 670 000 24%
2 Molga Consuting 350 074 393 045 -10,9%
3 Borlas 263 606 260 833 1%
4 EVOLA 220 433 201 309 9,5%
5 Galaktika Corporation 189 800 186 199 2%
6 EAE-Consult 164 855 140 125 17,6%
7 NORBIT 122 300 48 500 252,2%
8 SoftBalance 26 000 25 000 4%
9 Compass 20 000 19 175 4,3%
In total 2 177 868 1 944 186

* According to own data of TAdviser
TAdviser, 2014

The forecast of TAdvoser for the Russian market of HRM systems for 2014 moderate. The market will grow very slowly as serious growing is necessary to it. At the end of year market size will not exceed 16 billion rubles.

Market participants also agree with this point of view.
"We connect our main expectations with market "growing": already actually at all enterprises numbering more than 1000 people there are accounting systems, and the following question – to comprehend that these systems with their data can give for business and increase in its efficiency. As a result, understanding comes that use only of accounting programs providing "posthumous" accounting of changes does not correspond to real business needs any more: now the solutions of higher level allowing to exercise planning and control are necessary", - Maxim Uvarov, the deputy chief of department of the corporate Informkontakt projects noted.
Also the head of one of offices "The First BIT" Pavel Baskir holds the similar opinion. According to him, growth of interest of the enterprises in HRM is not followed by fast decision making about purchase of such systems: the western systems are still expensive as regarding the software, so regarding the cost of consulting and implementation works, and implementation domestic often also attracts costs for consulting.
"Now clients wait for release of new edition 3.0 of 1C: Payroll and HR Management CORP which is implemented on 1C: Enterprise platform 8.3 and should meet the modern requirements of the large organizations both to HR functionality, and to mobility, to provide a possibility of deployment "in a cloud", etc.", - he believes.

The competition between the western and Russian vendors moves to the area of strategy processes, mobile technologies, means of communication with workers now, the head of department of process automation of personnel management EAE-Consult Alexander Shishilov believes.

"The Russian vendors (the BOSS-personnel officer, 1C, the Compass), apparently, proved the best fitness in terms of quality, detail and the speed of working off of requirements of the Russian legislation. At the same time the largest western vendors, for example – SAP, place emphasis on integration of basic processes with so-called personnel development processes. Taking into account the shift of the general interest of the market for benefit of strategy processes, it is possible to expect in the near future that the Russian vendors will be forced to offer versions of the portal solutions supplementing basic delivery", - he considers.

2012

By own estimates of TAdviser, in 2012 the size of the market of HRM systems in Russia reached $500 million (about 15 billion rubles). Let's remind that in 2010 its volume was $380 million, i.e. in two years the market increased in volume almost by a third - for $120 million. In one and a half years which passed from the moment of an exit of the previous research, the number of HRM projects in TAdviser base grew almost by 2.5 times (from 760 to more than 1800 projects). At the same time, by estimates of analysts of TAdviser, in base of the portal no more than 10% of the projects implemented in the field of control automation by personnel in the last two years are concentrated.

First, a part of HRM projects is one of stages of deployment of large ERP platforms so such projects are marked by vendors as ERP projects, as appropriate they are registered also in base of the portal. Also projects with the number of licenses from 1 to 10 practically do not get to base in view of the significant amount.

Large players

For example, the franchisee of one of the largest players of the domestic market of automation of personnel records, 1C company, only in 2011 implemented in total 13.3 thousand projects based on 1C: Payroll and HR Management 8, in 2012 - 10.7 thousand such projects. By estimates of TAdviser, decrease in number of projects is connected with gradual "washing away" of 1C by other vendors from the upper bound of a segment of medium business and a segment of large business. Nevertheless, the company remains the absolute leader in the lowest price segment, in a segment of small business. By estimates of TAdviser, in 2011 the project scope based on different HRM configurations from 1C exceeded 1 billion rubles, in 2012 - made more than 800 million rubles (together with consulting).

Implementations of HRM, large on number of licenses, in Russia 2011-2012

Customer Industry Integrator System Number of licenses Details
1 Far Eastern Generating Company (FEGC) Power Novy Atlant Galaktika ERP: Guidance loop personnel 2848 Project description
2 RusHydro Power A-Energy Systems

|SAP ERP HCM

2600 Project description
3 Rosatom State structures MOLGA Consulting

|SAP ERP HCM

700 Project description
3 Tatneft Neftekhim Oil and gas industry 1C-Rarus 1C: Payroll and HR Management 8 CORP 700 Project description
4 Baltika FMCG Monolit-Info Monolith: Personnel 600 Project description
5 Transneft Oil and gas industry 1C: The first BIT 1C: Payroll and HR Management 8 CORP 521 Project description
6 Prokopyevskugol Extracting Financial technologies Galaktika ERP: Guidance loop personnel 472 Project description
7 Altayvagon Mechanical engineering Financial technologies Galaktika ERP: Guidance loop personnel 462 Project description
8 Salek Extracting Financial technologies Galaktika ERP: Guidance loop personnel 442 Project description
9 Yugra State University [[Образование и наука|Education Galaktika Corporation Galaktika ERP: Guidance loop personnel 400 Project description
10 AVTS Trade Galaktika Corporation Galaktika ERP: Guidance loop personnel 351 Project description

* on the basis of data on the projects placed in TAdviser base

The aforesaid does not mean that solutions 1C are not used by the large companies. For example, in top-10 the first in number licenses of the HRM projects implemented in 2011-2012 two projects based on 1C: Payroll and HR Management 8 CORP in the companies Tatneft Neftekhim and Transneft with the number of licenses 700 and 521 respectively entered. Also in the industrial sector where the most large-scale projects are implemented, systems Galaktika ERP: Guidance loop personnel Monolith: Personnel, Compass: Personnel management and the western system are in the lead SAP ERP HCM.

Domestic vendors still rather strong hold the market of HRM systems though partners of the western companies become from year to year more and more active. Partners of SAP CIS, for example, of IBS and I-Teco are especially noticeable in this plan. They oppose to strong examination of local developers the innovative solutions and successful business practices which distinguish platforms of the western vendors from the domestic systems. Indirectly activation of SAP in the Russian market of HRM systems is confirmed also by data of base TAdviser. In 2011 the HCM SAP ERP platform held the fifth place on implementation frequency, in 2012 - a third.

TAdviser, 2013

Andrey Li, the director of the department of personnel management systems of I-Teco Business Consulting, told TAdviser that SAP took "a huge step" towards localization of the solution for Russia that allows to increase implementation speed with each executed project. Now at SAP implementations of ERP HCM use a method of "Big Bang" more often: at once the complex option replicated in the shortest possible time is developed for all enterprises. The project in Severstal company can be a bright example: it was implemented in only two years provided that the implemented system daily processes the given more than 80 thousand employees, the expert noted.

Leading integrators

As for integrators, more than 150 companies work at the market of implementations of HRM, including vendors which are also engaged in deployment of systems and the accompanying consulting independently. According to TAdviser, 1C Companies were the most active integrators on number of implementations in 2011-2012 : The first BIT (earlier 1C: Accounting and Trade), BOSS. Personnel systems, Galaktika Corporation, Electronic Office Systems (EOS), 1C:VDGB and also MOLGA Consulting and Financial technologies. On total revenue it is also necessary to select IBS companies and I-Teco.

Revenues of system integrators in the market of HRM in Russia, 2010-2012, thousand rubles

Company Income 2011, thousand rubles Income 2010, thousand rubles Revenue forecast 2012, thousand rubles Revenue growth 2010-2011, %
1

|IBS*

667 000 318 100 670 000 109,7
2 I-Teco 553 000 607 400 - -9,1
3 Molga Consuting 206 210 168 315 300 000 22,5
4 EVOLA 193 566 119 782 - 61,7
5 Galaktika Corporation 156 000 138 830 186 200 12,4
6 AiT Soft 29 700 28 700 28 000 3,5%
In total 1 805 476 1 381 127

TAdviser, 2013 (* - on own to data of TAdviser)

Top trends

Regarding technology trends the Russian market of HRM systems, though with some delay on depth of adaptation of these or those new solutions, follows the world market. So, in 2011 it became clear that talent management and recruiting comes to the forefront in relation to primary HRM functions already everywhere implemented such as payroll and registration of personnel. In 2012 this trend was fixed and will only accrue. By estimates of Sergey Nikitin, the partner of MOLGA Consulting, the share of projects on performance management, talents, recruitment increased from 10-20% up to 40%.

The vice president of DiasoftMikhail Lebedev believes that the relevance of personnel recruitment through social networks and also integration with Internet resources, development of internal recruiting, use of online tools of the centralized assessment, testings of personnel and talent management increases. Most of the experts polled by TAdviser also selects growth of interest in SaaS of HRM and to mobile solutions in this area. "At the technology level in the next two-three years there will be a certain movement towards work with the cloud services first of all connected with distance learning, testing and personel assessment", -Igor Gubanov, the director of practice of department of HR solutions of IBS company believes.

At the same time, by estimates of TAdviser, the Russian market of HRM already reached a certain degree of a maturity. The considerable gain of number of projects and revenues of integrators fell on 2011, and in 2012 it slowed down a little. For example, in own base TAdviser the number of the HRM projects implemented in 2011 contains 478, and in 2012 – is 24% less, only 365.

Data on the number of the implemented projects based on the main configurations 1C were given above: here in 2012 reduction of number of projects in relation to 2011 was 19.5%. "The swing wheel" of the market of HRM systems in Russia was started during the crisis and post-crisis periods. In the 2010th year the segment of personnel management systems showed the largest growth. At the end of the 2011th year the general HRM covering actually reached a limit: the large corporate sector mostly already implemented at itself a payroll system and registration of personnel", - the director of the department of business applications Sitronics ITKirill Burliuk confirmed statistical data.

In the short term decrease in number of implementations will not affect growth of revenue of vendors and integrators, believe in TAdviser as projects of "the second wave" of automation of HRM on talent management and recruitment much more expensive, than implementation projects of circuits of payroll, including due to inclusion of a considerable share of consulting. However, in the long term the Russian market of HRM, including under the influence of promoting of inexpensive "cloud" services, can pass into a plateau status.

2010-2011

As well as in 2009, in 2010 with scoping of the market of personnel management systems in Russia there were difficulties for the same reasons: first of all it is difficulties with exarticulation of a HRM component from structure of "big" ERP projects. At most ERP vendors the functionality of HRM is implemented directly in the accounting system, and in the Russian market there is a lot of such systems.

Estimate number of ERP projects as a part of which there was control automation by personnel, very difficult. And as market size consists not only of the cost of the sold licenses, but also implementation services of systems, besides it is impossible to separate HRM block implementation cost separately from ERP for system integrators.

Inconsistency of assessment which different experts give to the Russian HRM to the market is explained by it. So, according to IDC Russia, in 2010 in terminology of the company the Russian Human Capital Management market (HCM, human capital management) made about $40 million. However, it is obvious that the concept HCM does not include simple functionality on payroll and accounting of the state, and like those projects the majority is sold in the Russian market.

The vice president of DiasoftMikhail Lebedev estimates the Russian market of HRM at the end of 2011 taking into account licenses and services at about $150 million. Own assessment of TAdviser taking into account results of 2009 ($350 million) - $380 million in 2010, growth in comparison with 2009 – 8.5%.

In terminology of TAdviser both implementations of the simplest systems on payroll, and the complex HRM systems in which the functionality of human capital management, HRM modules as a part of ERP systems and also specialized software products covering certain narrow areas, such, for example, as recruiting is implemented belong to the market of HRM.

Main players

In the Russian market of HRM systems suppliers of the largest ERP platforms are selected on number of implementations, and it is represented quite logical. It is the simplest to companies to automate both financial accounting, and payroll and personnel management on a single platform. After number of implementations of HRM by the undisputed leader in the Russian market 1C Company which offers several products of this class is. The number of implementations of these products is calculated by thousands, and here distribution of the main ERP system "1C: Enterprise", of course, plays a crucial role.

The number of implementations of HRM at the companies SAP Oracle, "Compass" and also owing to deep penetration in the Russian market of ERP platforms which offer these companies is also quite big. As for the specialized systems, among them are selected "BOSS-personnel officer" (the developer "BOSS. Personnel systems"), Diasoft FA Balance ("Diasoft"), "Personnel (EOS Group)" and some other products.


TAdviser, November, 2011

According to own data of TAdviser, at the moment taking into account all projects implemented in recent years on number of implementations the Compass platform is in the lead : Personnel management: 194 projects from 761 available in TAdviser base, or 25.5% are the share of it. On the second place on number of implementations -  the "1C: Payroll and HR Management 8" system. However the essential clause is required here. 1C HRM is not just the leader, and the undisputed leader of the Russian market. According to own database of implementations of 1C Company, at the moment the franchisee of the company implements more than 40 thousand implementations of personnel management systems based on different solutions. From them 85.5% of implementations (more than 34.3 thousand projects) are the share just of the configuration mentioned above. Insignificant shares occupy also other systems and industry solutions: "Fireplace: Payroll 8", "Salary and budget institution staff 8", "Personel assessment 8" and "Salary and personnel management CORP 8". For obvious reasons, it is impossible to consider all these implementations in TAdviser base. 

It is also difficult to isolate those implementations in which there was zadeystovovan HRM a functionality from structure of ERP projects. So data on number of implementations of HRM in Russia to some extent are conditional. 


TAdviser, November, 2011

As for the largest integrators, here picture also not absolutely certain. According to data of TAdviser, the greatest number of projects is implemented  by the Compass company  - 170 projects. The first five includes also  BOSS. Personnel systems,   1C:VDGB, Datex Software and Diasoft. However, if to consider the ERP projects as a part of which there is HRM then alignment of forces could be other. There are no data on the similar projects implemented by partners of SAP, Oracle, Galaktika Corporation and Monolit-Info-. You should not forget also about the franchisees of 1C implementing HRM implementations. 

In opinion Irina Schukina, the sales director Compass, the Russian market of HRM systems approaches saturation. "It is already impossible to find the company in which personnel records and payroll are not automated. And top trends are reflection of this situation. The companies develop installed systems and implement earlier not mastered functionality. And if a system cannot develop or be scaled under tasks of the enterprise replace it", - she commented.

From the beginning of crisis of 2008 many companies froze HRM projects or postponed their beginning for more favorable time at the expense of what the pent-up demand was formed. These companies also created the main demand in 2011. It is obvious that in 2012 such trend will proceed.

Main trends

The most important qualitative trend of the Russian market of HRM is paradigm shift of control automation by personnel: the increasing number of the Russian enterprises feel the need for automation of the HRM functions outside payroll and registration of personnel, i.e. directly management tools by personnel. According to Mikhail Lebedev, the vice president of Diasoft, in Russia enough HRM systems, now - business in their use and optimization of internal processes purchased and implemented. "Under optimization I mean settlement processes of efficiency of use of a HRM system and search of ways of increase in this efficiency", - the expert explained.

Dmitry Shekhodanov, the head SAP HCM of EVOLA company, also considers one of the main trends – performance management of personnel. This function includes such processes as employee competence rating, setting and assessment of achievement of goals (KPI) of employees, multiple-factor calculation of remuneration on the basis of accomplishment of personal plans of activity, the general work of division and the company, achievement of the set qualitative and quantitative objects, he explained.

This function, Dmitry Shekhodanov says, became especially relevant recently because the management of the companies realized: such aspects can be considered and done them transparent for employees. Thereby the self-motivation of workers increases: they can calculate future bonus proceeding from accomplishment or non-performance of effective objectives in advance. "Processes of motivation are very individual in the different industries and even in the industry and are not standardized. Many enterprises have a problem of implementation of such systems, but additional methodological study internal business of processes therefore this trend will be postponed also for next year is required", - the expert concluded.

Maria Ivanova, the architect of projects in the field of HR "Sitronics IT", considers that the main emphasis in development of HR systems will be put on management of an organization and regular structure of the enterprise, control automation by the budget. The companies which moved to deeper level of development of HR systems will actively invest in optimization of motivational schemes of personnel development based on KPI.

2009

According to TAdviser, at the end of 2009 the size of the market of HRM systems (Human Resource Management) and services in their implementation in Russia was 350 mln. dollars that is 16% more, than the previous year (300 million dollars).

When scoping market researchers faced several obstacles considerably complicating calculations. First, even the largest suppliers do not separate the sold licenses of ERP systems and the sold licenses HRM (as parts of an ERP system). Also these functions often are implemented in accounting programs. Besides, there are separate products for automation of activity of HR department which are sometimes developed under the customer though their share in the market is not big.

Other obstacle when scoping sales in a segment is that it is difficult to share turnovers of large integrators into implementation services of ERP and HRM – as a component of implementation services of ERP. Also there is a classification issue of HRM systems which gives ambiguity in reference of this or that system to this class. Nevertheless, most of respondents of TAdviser, market participants agree with assessment of total volume of sales at the end of 2009.

In a segment of control automation by personnel in Russia in 2008-2009 there was a unique situation when the factors which gave to the market positive dynamics as a result were created from the negative crisis phenomena.

From minus to plus

From the beginning of 2008 and until now the loudspeaker of the Russian segment of HRM systems was not uniform, also the nature of top trends changed. If the period till October-November, 2008 (the beginning of crisis) was characterized by an optimistic view in the future for all main players, then already by the beginning of 2009 the number of agreements on installation of the new systems sharply decreased.

Besides, many large HRM projects which by the beginning of crisis were already given start were suspended and frozen. As well as in all other industries, it was caused first of all by universal aspiration of the companies to reduction of operating expenses and costs. "The mood in relation to the future during this period went to the negative area. The personnel were in large quantities reduced. The basic principle – "leave only those without whom not to survive". Costs were minimized by the enterprises at the expense of the wages fund, training programs and retraining of personnel, and other budget items. Under reduction also IT budgets got", - Mikhail Koshelev, the deputy CEO Alekta told.

However the recession period in the HRM market did not become long. When under blow the services of the HR enterprises which endured considerable reductions got there was a question how it is possible to adjust effectively implementation of functions of these services in the conditions of the shortage of human resources, Andrey Shabanov, the CEO of UCMS Group of the CIS commented. Under the influence of urgent need to optimize a personnel management process the question of automation of this area of business processes returned on the agenda in new quality. Having endured the sharpest period of crisis, the companies were engaged in search of the budget and functional HRM systems. "The shake-up which the companies endured led to reconsideration by many heads of the attitude towards personnel and, respectively, to HRM systems as to the instrument of increase in efficiency (survival) of the enterprise", - he is sure.

"Among the first after crisis the market of personnel management systems begins to be resumed", - the CEO of IBS Sergey Matsotsky confirmed. According to him, now the companies need to reanimate business and to bring personnel out of a depression, and not least it is a task for IT systems. According to most of players of the Russian market of control automation by personnel, for the end of 2009 – the beginning of 2010 is noted market revival which allows to do the first optimistic forecasts with care. In process of stabilization of economy in the market the pent-up demand begins to be felt.

Top trends

Treat number of essential trends which in the foreseeable future will continue to have an impact on the Russian market of control automation by personnel first of all the increasing interest in HRM solutions as a result of the increased load of personnel and requirements to its quality. According to Mikhail Koshelev, the greatest demand for such products still proceeds from large enterprises. "So far it is difficult to expect change of this trend", - he says.

Besides, the largest vendors, such as SAP and 1C, will continue to strengthen the positions due to failure of the enterprises from independent development of HRM products for internal use, the expert considers. In a segment of large business demand for HRM systems also forms due to consolidation of the enterprises, Natalya Sidorova, the area director of Epicor in Russia and the CIS countries specifies. According to her ¸ such consolidation demands from the companies of more system work with personnel, and, as a result, gradually gives rise to demand for the full-fledged HRM systems.

Formation and market development of the HRM solutions provided according to the SaaS model (soft as a service is software as service) remains one of current trends, Andrey Shabanov considers. In spite of the fact that the HRM solutions using model of remote access to a system while are new to the Russian market, at the moment behind them recognize good perspectives. First of all the large companies, banks at which requirements to confidentiality of information are rather high are interested in such solutions, Shabanov says. As for a segment of medium-sized and small enterprises, here the general approach to economy also generates interest in such systems. "There is a large number of persons interested to try approach of SaaS. There is a great interest to automation of control functions of personnel in general", - he said.

Also strengthening of positions of the outsourcing companies in the market of HRM as many enterprises transfer the functions on payroll and personnel records to external suppliers continues. As a result, further the competition of outsourcing solutions and the traditional systems will escalate. Demand for outsourcing of HR functions will remain stable owing to aspiration of the companies to economy of IT budgets.

Forecasts

Participants and analysts of the Russian market of HRM systems agree in opinion that in 2010 it will save positive dynamics, however, its growth will not be avalanche, and, on the contrary, very smooth and careful. "Crisis negatively influenced plans of the companies for implementation of HRM systems in 2010. I think, some time before we are able to speak about significant increase in demand for HRM systems will be required. At the same time, many clients planning implementation of iScala HRM, but forced to freeze budgets in 2008 started implementation by the end of the 2009th year. So the positive trend is and, hope, will proceed", - Sidorova says.

Demand for HRM systems will become stronger in process of understanding by heads of the enterprises of the fact that this type of solutions has significant effect on efficiency of activity of personnel. All trends which were shown in 2009 until continue to have an impact on the market: here belong as strengthening of demand from the large companies, gain of positions of large vendors, and development of segments of outsourcing of personnel management and transfer of personnel management to the SaaS mode. Anyway, the market will save high potential to growth which can be shown at approach of more favorable macroeconomic conditions as before its saturation it is still far.