State of HR Technology and Transformation

This document is a research report that outlines the current state of human capital management (HCM) technology and the ongoing transformations within organizations. It details that two-thirds of HCM transformation programs are expected to continue into 2027, driven by motivations such as improved data insights and global HR operations harmonization. The report highlights the limited budget for AI initiatives across HR functions, with enterprises testing an average of six use cases but only one currently in production. Additionally, it notes that 84% of enterprises anticipate changes in their sourcing approaches by the end of 2027, affecting about one-third of HR functions. The report also discusses the challenges faced by HR functions, including budget constraints, legacy system complexities, and organizational resistance to change, which hinder the realization of expected business outcomes. Overall, the report presents a comprehensive view of the evolving landscape of HR technology and the associated challenges.