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The four pillars of talent management systems: A solid HR foundation

Last updated:April 2014

Editor's note

The notion that people can be a crucial business differentiator is now well established, and in light of this, human resources technology has been taking off in recent years.

While most companies already use a human resource information system (HRIS) as a repository for employee records and basic information, many organizations are going a level deeper by adding talent management systems to their HR technology portfolios. Experts say talent management systems can help companies attract, retain and develop employees to the mutual benefit of both parties.

But what is a talent management system and how can adopting one enable a company to achieve these goals? Talent management systems are generally considered to be comprised of four modules, also called "pillars:" recruitment, performance management, corporate learning and compensation management. Integrated talent management suite vendors offer all four, but HR leaders rarely buy an entire suite at once. Instead, they usually purchase one to three modules at a time with the intention of building out the entire platform, according to experts.

This guide dives deep into each of the four pillars that form the foundation of a talent management suite. Each section contains expert advice about the benefits and potential challenges of implementing a specific talent module, as well as user tips on vetting the software and using it effectively. The final section puts it all together with information on end-to-end talent management suites and provides perspective on forces that are driving the market.

1Corporate learning: Develop employees to their fullest potential

Learning management systems have long been used to administer courses and other formal training programs. However, experts say that corporate learning is now branching out beyond rigid course delivery to a more informal and integrated experience.

This section delves into how and why the corporate learning space is changing, and spotlights companies that are embracing new ways of employee development. In addition, you'll discover what capabilities experts recommend keeping an eye out for when vetting new learning technology.

2Performance management: Bring out the best in people

Most organizations have historically adhered to an annual formal review process, where an employee sits down with his manager to discuss strengths, goals and areas for improvement. But today, HR managers are realizing that the performance management process itself needs improvement.

In recent years, many companies have ditched the annual assessment-based review in favor of a more frequent, coaching-oriented model. Another significant trend in the performance management space is to involve more people in the review process, to supposedly get a more accurate picture of an employee.

Peruse this section to learn more about how prominent companies are using performance management technology to shake up their review processes.

3Compensation management: Reward appropriately and quickly

At many organizations, compensation management is handled in Microsoft Excel rather than dedicated software. But when spreadsheets become unwieldy, talent management providers offer compensation management modules to automate the task. In addition to reducing manual labor and potential for errors, experts say compensation management software adds visibility into bonuses and other employee rewards, which in turn magnifies motivation.

This section contains user and expert anecdotes that illustrate the benefits of compensation management software, as well as tips to sidestep common pitfalls.

4Talent management suites: Support employees from hire to retire

As standalone, "best of breed" talent management technology wanes, interest in integrated talent management suites that contain all four pillars is steadily climbing, according to industry analysts. However, experts warn that "integrated" can sometimes be a misnomer, and many suites created through acquisition are often not as unified as vendors claim.

In this section, get questions to ask and considerations to make that are critical to successfully evaluating, choosing and implementing a talent management suite, and learn how to steer clear of integration snags.