One example is Ottawa-based human resources software firm Corporate Renaissance Group, which specializes in performance management. CRG recently spearheaded a partnership dubbed "HR in the Cloud," which includes a Montreal software company and two from the United States. The software-as-a-service product integrates each company’s HR product into a cloud application, giving one point of entry for HR professionals to access all four companies’ products…
With the cloud computing sector still in its infancy, Jerry Glowka, co-founder of the Ottawa Cloud Cluster, said companies are manoeuvring for more customers and attempting to reduce costs by sharing infrastructure.
"(Collaborations) are more for economic reasons," Mr. Glowka said. "If they built (the infrastructure) themselves, they would probably have to invest in a lot of hardware. It’s more cost-effective to partner and share that cost."
Cloud computing infrastructure must allow virtual servers to be transferred to different data centres when the capacity of one data centre reaches its threshold. With larger firms able to build the infrastructure to support a large cloud computing space, smaller companies have to pool their resources in order to compete, Mr. Glowka said.
Five years ago, CRG entered the HR space by developing browser-based software for facilitating performance appraisals and compensation planning.
The local firm will fill the performance management piece of the collaboration, with applicant tracking, a human resource information system, and learning and compliance management being filled by the other participating companies. This will provide a ‘cradle-to-grave’ approach, with HR departments able to manage employees from the time they are hired to when they leave the company.
"What we’ve seen over the past five, six years is a dramatic increase in the attention given to talent management. The space is growing," said John Smith, director of enterprise business solutions at CRG.
The collaboration comes as companies attempt to squeeze more value out of HR departments. A 2009 Deloitte survey found 84 per cent of its client companies from around the globe were transforming, or planning to transform, their HR practices.
Mr. Smith suggested this could be because companies lack the tools to analyze and quantify the return and value of their labour expenses. Furthermore, companies are attracted to cloud-based software-as-a-service products because they can avoid the large capital expenses of supporting on-site applications.
Some companies have tried to address the various pieces of HR software themselves, leading to products that are not able to perform the functionality desired by industry professionals, Mr. Smith said.
He did not comment on the expected revenues derived from the partnership, saying the group will take a "wait-and-see" approach to anticipated returns on the collaboration. With very few companies adopting a similar model, he said there isn’t a comparable reference point.