2021 Chinese HR SaaS Industry ReportSource:iResearch
November 22,20216:15 PMOverview
The Relationship Between HR SaaS and Enterprise Digital Transformation
Simply put, HR SaaS is human resource service software, a completely innovative software application model that emerged from the mature Internet. Application software is deployed by HR SaaS vendors on their own servers. The customers can purchase the software they need and enjoy the services provided by vendors via the Internet. In the process of enterprise digital transformation, the match of corporate strategies with organizational goal management, execution efficiency, human resource incentive, corporate culture, etc. has a direct impact on the competitiveness of the company. HR SaaS is a dual-attribute tool. As it has integrated software capabilities and the underlying talent management concept, it can empower enterprises' business development and digital transformation from a higher perspective.
Drivers of the HR SaaS Market in China 1/3
The scale of digital economy accounts for an increasing proportion in GDP
Digital economy development is among China's national strategic goals. The growth rate of the digital economy has been much higher than that of the GDP over the same period in recent years. Enterprise digitalization drives the new round of national economic development. Stimulated by both industrial digitization and digital industrialization, in 2020 China's digital economy scale hit 39.2 trillion yuan, accounting for 38.6% of its GDP, increasing 2.4pct compared to 2019. Its impact on the overall economic output value has further increased. As an enterprise management tool, HR SaaS is closely related to enterprise digitalization. Together with other tools, it can improve the efficiency of production, management, operation, supply chain, and other links, thereby driving the fast development of the digital economy. The development of the digital economy will provide a good environment for the penetration of digital tool application in enterprises, forming a spiral positive circulation.
Drivers of the HR SaaS Market in China
Cloud computing technology facilitates digital transformation
With the construction of cloud computing infrastructure and the maturity of technology the scale of the cloud service market keeps growing and reached 231.55 billion yuan in 2020, increasing by 43.6% YoY. iResearch projects that the market size will hit 538.14 billion yuan by 2023 and maintain a growth rate of over 30% in the next few years. CAICT data shows that in 2019 the proportion of Chinese enterprises using cloud computing reached 66.1%, increasing by 11.4pct compared to 2017. Companies start digital transformation after going through the informationization stage. As a light asset product of human resource management, HR SaaS has the feature of flexible delivery. It can relieve the cash flow pressure on enterprises and is of great significance to enterprise digital transformation.
Extension of HR SaaS Application Scenarios
In the human resource management application scenarios, HR SaaS covers the whole chain, including recruitment management, core human resource management, training and development, talent management, talent assessment, organizational development, and so on. Among them, core human resource management consists of organization information, attendance management, performance management, and salary management. Different from core human resource management, talent management takes competence as the core and combines various modules through competence recognition models. Therefore, various technologies such as model building, assessment, and online examination are needed to assist judgment. Using HR SaaS products, companies can manage the entire life cycle covering employee recruitment, selection, hiring, management, development, retention, and resignation, realize digital management of human resources, and greatly improve management efficiency, which will conducive to talent retention and organizational development. In addition to standard users, the increasing demand for blue-collar employment management in recent years has also attracted more attention to the flexible employment market and demand explosion.
Simply put, HR SaaS is human resource service software, a completely innovative software application model emerged from mature Internet. Application software are deployed by HR SaaS vendors on their own servers. The customers can purchase on demand, and enjoy the services provided by vendors via the Internet.
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