Human Capital Management or Human resource management system (HRMS) is a set of practices required for human resource management. HCM technology helps organisations for work force management, workforce acquisition and workforce optimization. The technology helps the organisation employees to manage employment modules such as the attendance, leave, payroll, hiring, training etc throughout the employee lifecycle. This also helps human resource (HR) teams of companies to monitor employee details, skills, and day to day activities.
The HCM market in India is very cluttered. Majority focus of many vendors is on the Tier I cities in India and the focus has recently changed to other cities due to new technology companies emerging regularly with a new and innovative, simplistic user interface HCM solution. The companies located in cities such as Mumbai, Delhi, Bangalore and Hyderabad are mostly equipped with HCM technology for their employees, but the start-ups can be targeted in these areas. Cities such as Ahmedabad, Kanpur, Surat, Vijayawada are the cities to target as there is still scope in the locations as HCM vendors have medium to low presence in these cities.
HCM was traditionally an on-premise deployed model but since the cloud scene in India has begun, all the HCM technology companies are providing cloud services. 90% of the vendors who were providing on-premise solution have also moved to cloud solution as the clients have requested for their data to be deployed on cloud. Due to the reasons such as flexibility, scalability and agility, cloud deployment is most preferred deployment mode for vendors and clients.
Since Large companies are looking to invest in large HCM brands or traditional HCM players such as People strong, Darwinbox, Oracle, RAMCO, the Small and Medium enterprises should be the target companies for the new HCM vendors in the market. Government schemes and initiatives such as the Make in India, Start-up India and Skill India is the driving factor for the HCM vendors. They are enabling many enthusiasts to start own companies, and this is giving rise to many new companies to target for HCM technology.
IT and ITeS vertical is expected to hold the largest market share in India as this segment is very receptive of new technological changes. The sectors such as the merchant trading, retail, and (Unorganised) finance sectors are not very technology savvy, so these sectors need to be pushed to implement software and the workforce is not educated hence training is very essential for technology implementation.
HCM vendors such as GreytHR, Keka HR, ZingHR, Zoho, SumHR are the top vendors for SMEs in India, having presence in most regions in India and having a wide product portfolio with easy to access user interface is the distinguishing factor for these vendors.
– Sishir Naren
ICT – Research Analyst