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AI Becoming Essential to HCM, ISG Says

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Information Services Group (ISG) (Nasdaq: III) reports that Artificial Intelligence (AI) is becoming essential for human capital management (HCM), with two-thirds of enterprises projected to require AI-enabled HCM software by 2027.

The ISG Buyers Guides™ for HCM reveals that AI and machine learning are the primary drivers of change in talent management and HR systems. The research evaluated 19 software providers across four categories: HCM Platforms, HCM Suites, HRMS, and Talent Suites.

Key findings:

  • AI enables strategic resource use and consumer-like employee experiences
  • Predictive analytics helps anticipate talent shortages
  • Companies must choose between all-in-one suites or best-of-breed solutions
  • Oracle emerged as a leader across all categories
  • ADP consistently ranked second with strong performance

Information Services Group (ISG) (Nasdaq: III) riporta che l'intelligenza artificiale (AI) sta diventando essenziale per la gestione del capitale umano (HCM), con due terzi delle imprese che si prevede necessiteranno di software HCM abilitati all'AI entro il 2027.

Le Guide agli Acquirenti ISG™ per HCM rivelano che l'AI e il machine learning sono i principali motori di cambiamento nella gestione dei talenti e nei sistemi HR. La ricerca ha valutato 19 fornitori di software in quattro categorie: Piattaforme HCM, Suite HCM, HRMS e Suite Talent.

Risultati chiave:

  • L'AI consente un uso strategico delle risorse e esperienze dei dipendenti simili a quelle dei consumatori
  • Le analisi predittive aiutano ad anticipare le carenze di talenti
  • Le aziende devono scegliere tra suite all-in-one o soluzioni best-of-breed
  • Oracle è emersa come leader in tutte le categorie
  • ADP si è costantemente classificata al secondo posto con prestazioni solide

Information Services Group (ISG) (Nasdaq: III) informa que la inteligencia artificial (IA) se está convirtiendo en esencial para la gestión del capital humano (HCM), con dos tercios de las empresas proyectadas para requerir software HCM habilitado para IA para 2027.

Las Guías para Compradores de ISG™ para HCM revelan que la IA y el aprendizaje automático son los principales motores de cambio en la gestión del talento y los sistemas de recursos humanos. La investigación evaluó a 19 proveedores de software en cuatro categorías: Plataformas HCM, Suites HCM, HRMS y Suites de Talento.

Hallazgos clave:

  • La IA permite un uso estratégico de los recursos y experiencias de empleados similares a las de los consumidores
  • El análisis predictivo ayuda a anticipar escasez de talento
  • Las empresas deben elegir entre suites integrales o soluciones de mejor calidad
  • Oracle se destacó como líder en todas las categorías
  • ADP se clasificó consistentemente en segundo lugar con un rendimiento sólido

정보 서비스 그룹 (ISG) (Nasdaq: III)는 인공지능 (AI)이 인적 자원 관리 (HCM)에 필수적이 되고 있으며, 2027년까지 3분의 2의 기업이 AI 지원 HCM 소프트웨어를 필요로 할 것으로 예상된다고 보고합니다.

ISG 구매자 가이드™는 HCM에서 AI와 머신 러닝이 인재 관리 및 HR 시스템의 주요 변화 요인이라고 밝혔습니다. 이 연구는 HCM 플랫폼, HCM 스위트, HRMS 및 인재 스위트의 네 가지 범주에서 19개 소프트웨어 공급업체를 평가했습니다.

주요 발견:

  • AI는 전략적 자원 사용과 소비자와 같은 직원 경험을 가능하게 합니다
  • 예측 분석은 인재 부족을 예측하는 데 도움을 줍니다
  • 기업은 올인원 스위트 또는 최상의 솔루션 중에서 선택해야 합니다
  • 오라클은 모든 범주에서 리더로 떠올랐습니다
  • ADP는 지속적으로 강력한 성과로 2위에 올랐습니다

Information Services Group (ISG) (Nasdaq: III) rapporte que l'intelligence artificielle (IA) devient essentielle pour la gestion des ressources humaines (HCM), avec deux tiers des entreprises qui devraient nécessiter des logiciels HCM dotés d'IA d'ici 2027.

Les Guides d'Achat ISG™ pour HCM révèlent que l'IA et l'apprentissage automatique sont les principaux moteurs de changement dans la gestion des talents et les systèmes RH. La recherche a évalué 19 fournisseurs de logiciels dans quatre catégories : Plates-formes HCM, Suites HCM, HRMS et Suites de Talent.

Conclusions clés:

  • L'IA permet une utilisation stratégique des ressources et des expériences employés similaires à celles des consommateurs
  • Les analyses prédictives aident à anticiper les pénuries de talents
  • Les entreprises doivent choisir entre des suites tout-en-un ou des solutions de meilleure qualité
  • Oracle s'est imposé comme leader dans toutes les catégories
  • ADP s'est constamment classé au deuxième rang avec de solides performances

Information Services Group (ISG) (Nasdaq: III) berichtet, dass künstliche Intelligenz (KI) für das Management von Humanressourcen (HCM) unerlässlich wird, wobei zwei Drittel der Unternehmen bis 2027 voraussichtlich KI-gestützte HCM-Software benötigen werden.

Die ISG Käuferratgeber™ für HCM zeigen, dass KI und maschinelles Lernen die Haupttreiber des Wandels im Talentmanagement und in HR-Systemen sind. Die Forschung bewertete 19 Softwareanbieter in vier Kategorien: HCM-Plattformen, HCM-Suiten, HRMS und Talent-Suiten.

Wichtigste Erkenntnisse:

  • KI ermöglicht eine strategische Ressourcennutzung und ein verbraucherähnliches Mitarbeitererlebnis
  • Prädiktive Analysen helfen, Talentengpässe vorherzusehen
  • Unternehmen müssen zwischen All-in-One-Suiten oder Best-of-Breed-Lösungen wählen
  • Oracle hat sich in allen Kategorien als führend erwiesen
  • ADP belegte konstant den zweiten Platz mit starker Leistung

Positive
  • Growing market opportunity with two-thirds of enterprises needing AI-enabled HCM by 2027
  • Strong market positioning and leadership recognition in research evaluation
  • Expanding capabilities in predictive analytics and AI-driven features
Negative
  • Increasing competition in the HCM software market
  • Complex decision-making process for customers between consolidated vs. best-of-breed solutions

Two-thirds of enterprises will need AI-enabled HCM software by 2027 as employee expectations change, data’s potential expands, new research finds

STAMFORD, Conn.--(BUSINESS WIRE)-- AI is becoming a core requirement for human capital management (HCM) and employee engagement, with two-thirds of enterprises expected to need AI-enabled capabilities in their HCM systems by 2027, according to new research from global AI-centered technology research and advisory firm Information Services Group (ISG) (Nasdaq: III).

The ISG Buyers Guides™ for HCM, produced by ISG Software Research, find the biggest driver of change in talent management and HR management system (HRMS) software is the growing use of AI and machine learning (ML) in these systems. Once focused on administrative functions, HCM has become a strategic asset over the past decade and is now central to developing and engaging a workforce to be more productive.

“Businesses expect HCM technology to improve workforce agility, decision-making and alignment with enterprise goals, all of which AI can help to achieve,” said Matthew Brown, HCM research director, ISG Software Research. “Software providers are integrating AI into all aspects of HCM, enabling more strategic use of resources and giving employees a more consumer-like experience.”

AI is the basis of new employee workflows and engagement, embedded analytics and personalized self-service, the research finds. These advances are transforming how organizations make strategic HR decisions. For example, predictive analytics allows leaders to anticipate and address talent shortages before they affect operations. Instead of relying solely on historical workforce data, companies can use AI to identify critical roles, assess internal readiness for them and decide whether to fill the roles through training or external hiring.

Enterprises upgrading their HCM software face a choice between consolidating disparate systems in all-in-one suites or integrating best-of-breed solutions, ISG says. While the former offers seamless integration across all HR functions, the latter may provide better capabilities for specific HR processes like payroll or workforce management, ISG notes.

A unified approach to HCM simplifies HR operations and employee data and eliminates silos and streamlines processes across an organization. Talent suites, meanwhile, support the entire talent lifecycle—including recruiting, learning, performance and talent planning—and providers are now adding AI-driven features such as skills matching and personalized learning.

When assessing or selecting software, companies often consider scalability and the level of embedded AI-driven automation. Organizations must carefully evaluate their unique needs and their HR and workforce objectives to choose the right applications and HCM platform, ISG says. One of the most significant shifts in the market is the growing demand for configurable platforms that allow for customization and integration of third-party applications and services.

Companies that invest in AI-enabled HCM will gain the ability to guide actions and unify decision-making for engaging and retaining employees, maximizing the value of talent and aligning workforce strategies with business goals, ISG says. To maintain that edge, they need to not only utilize the right software but continuously evolve their HCM strategies.

For its 2025 ISG Buyers Guides™ for HCM, ISG evaluated software providers across four categories—HCM Platforms, HCM Suites, Human Resources Management Systems (HRMS) and Talent Suites—and produced a separate Buyers Guide for each. A total of 19 providers were assessed: ADP, BambooHR, Cegid, Darwinbox, Dayforce, HiBob, Infor, isolved, Oracle, PageUp, Paycom, Paycor, Paylocity, Rippling, SAP, UKG, Unit4, Workday and Zoho.

ISG Software Research rates software providers in seven evaluation categories. Five are product-related: usability, manageability, reliability, capability and adaptability. Two are customer experience-related: validation and total cost of ownership and return on investment (TCO/ROI). Providers ranked in the top three of each evaluation category are named as Leaders. Within each software category, those with the most Leader rankings are named as Overall Leaders.

The 2025 ISG Buyers Guides™ for HCM named the following Overall Leaders:

HCM Suites: In this evaluation, the most comprehensive as it covers both HCM platform and HRMS capabilities, Oracle was named a Leader in all seven categories, and ADP a Leader in six. UKG came in third with Leader designations in three categories. Dayforce, HiBob, SAP and Workday were rated Exemplary.

HCM Platforms: Oracle topped the list, being designated a Leader in all seven evaluation categories, and ADP followed closely, with Leader designations in six categories. UKG was Exemplary and designated a Leader in four categories. Dayforce, HiBob, SAP and Workday were rated Exemplary. Two providers rated as Innovative were Darwinbox and Rippling.

HRMS: Oracle was named a Leader in all seven HRMS evaluation categories. ADP again came in a close second, ranking as a Leader in six categories. UKG was named a Leader in four categories. Dayforce, HiBob, SAP and Workday were rated Exemplary.

Talent Suites: Oracle and ADP were designated as Leaders in seven and six evaluation categories, respectively, and there was a three-way tie for third place among SAP, UKG and Workday, which were designated Leaders in two evaluation categories each. Cornerstone, Dayforce, HiBob, SAP and Workday were rated Exemplary.

“Software providers will be adding AI, both GenAI and Agentic AI, within applications to simplify and deliver a more consumer-grade user experience over the next few years,” said Mark Smith, partner and chief software analyst, ISG Software Research. “Given these advances, choosing the right HCM software provider has never been more important to the future of an organization. Our ISG Buyers Guides offer the most comprehensive research across all HCM software categories to enable enterprises to make decisions with confidence.”

The ISG Buyers Guides™ for HCM are the distillation of more than a year of market and product research efforts. The research is not sponsored nor influenced by software providers and is conducted solely to help enterprises optimize their business and IT investments to reach maximum set of outcomes.

Visit this webpage to learn more about the ISG Buyers Guides™ for HCM and read or listen to executive summaries of each of the four reports. The complete reports, including provider rankings across seven product and customer experience dimensions and detailed research findings on each provider, are available by contacting ISG Software Research.

About ISG Software Research

ISG Software Research provides authoritative coverage and analysis of the business and IT software industry. It distributes research and insights daily through its user community, and provides a portfolio of consulting, advisory, research and education services for enterprises, software and service providers, and investment firms. Its ISG Buyers Guides™ help enterprises evaluate and select software providers through tailored assessments powered by ISG’s proprietary methodology. Visit research.isg-one.com for more information and to sign up for free community membership.

About ISG

ISG (Nasdaq: III) is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world’s top 100 enterprises, ISG is a long-time leader in technology and business services that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data, in-depth knowledge of provider ecosystems, and the expertise of its 1,600 professionals worldwide working together to help clients maximize the value of their technology investments.

Press Contacts:



Will Thoretz, ISG

+1 203 517 3119

will.thoretz@isg-one.com

Julianna Sheridan, Matter Communications for ISG

+1 978 518 4520

isg@matternow.com

Source: Information Services Group, Inc.

FAQ

What percentage of enterprises will need AI-enabled HCM software by 2027 according to ISG (III)?

According to ISG, two-thirds (66.7%) of enterprises will require AI-enabled HCM software capabilities by 2027.

Who are the top performers in ISG's 2025 HCM Suites evaluation?

Oracle led as the top performer with leadership in all seven categories, followed by ADP with six leadership designations, and UKG in third place with three leadership categories.

How is AI transforming HCM software according to ISG's research?

AI is enabling new employee workflows, embedded analytics, personalized self-service, and predictive analytics for strategic HR decisions and talent management.

What key decision do enterprises face when upgrading HCM software?

Enterprises must choose between consolidating systems into all-in-one suites or integrating best-of-breed solutions for specific HR processes.
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