Why hasn’t HR evolved at the same pace as other lines of business? Of course, there are some excellent solutions out there, SAP and Workday, among them, but these are expensive options; do you really a Rolls Royce when a sturdy Toyota Hilux will do?
Both SAP and Workday can claim that their sophisticated technology will unlock insights and optimisation opportunities, and will streamline everything from hiring, onboarding, and, once the employee actually starts working, manage their performance. Both these companies have also gone all in with AI.
Workday, for its part, now has what it calls an Agent System of Record, a platform that manages AI agents, which, in turn, automate HR functions such as recruiting or managing expenses. SAP, meanwhile, has its GenAI agent Joule, which helps with all manner of HR tasks. Both companies have also laid off workers. In the case of Workday, 1 750 employees were shown the door in February this year, as it prioritised “innovation investments like AI and platform development”. It said in June that it now wants to hire a similar number, but is looking for people with different skillsets.
Meanwhile, HR managers and staff at small and medium-sized businesses struggle on with what tools they have, which are often the same tools they found when they joined the company. And the long-suffering staff will just have to put up with being paid late, or turn up for work only to be told that the roster has changed.
Jem HR started life in 2019, offering an earned-wage access service via WhatsApp. The company was called Smart-Wage then, and Caroline van der Merwe, chief product officer, says employers were seeing great uptake of the platform among their employees. These employers wondered if they could use the Smart- Wage channel to send out messages to their workers, which led the company to stumble onto the fact that companies were finding it very hard, if not impossible, to communicate properly with their frontline workers, particularly in emerging markets.
“We came across companies that have 10 000 employees and were literally printing out 10 000 payslips a month, and putting them on a bakkie and then sending them out into the wilderness,” says Van der Merwe. And like that, Jem, named after the djembe drum from West Africa, started offering HR and financial services to frontline workers in the deskless sector, such as those working in mining, retail, hospitality, manufacturing and security.
In hindsight, it was a good business move to focus on WhatsApp, but initially, Meta didn’t offer easy access to its API. This has now changed, and the process is much easier for companies to build features and application on the WhatsApp cloud API. Van der Merwe says WhatsApp is increasingly being used by companies to interact with their customers, such as getting your boarding pass from Fly Safair or messages from Discovery.
This is why you have to build tech products that take into account the market that you’re in, and not just an extension of what's going on in the UK or the States.
Caroline van der Merwe, Jem
As they investigated the market, Van der Merwe said they found it to be focused on Western audiences. A KFC employee in the United States will almost certainly have an advanced smartphone and can download apps. While most South Africans now own a smartphone, they don’t have a lot of space for apps. They may also not have an email address where they can confirm their password, or have the digital literacy to navigate through that process.
There’s also the fact that, in South Africa, many workers will have their smartphones stolen, and so will be without a phone for a while. Van der Merwe says many people also tend to leave their smartphone at home and take their feature phone to work, to guard against theft.
“For me, this is why you have to build tech products that take into account the market that you’re in, and not just an extension of what's going on in the UK or the States.”
One of its customers is Securitas, which has around 3 500 employees at over 400 sites.
“How do you get the most basic information to these people, and how do you organise payslips?” Van der Merwe asks. Common questions are, is WhatsApp safe to use for sending payslips, and is the data safe, she adds.
“Is it safe to send out a paper payslip in the back of somebody's car, and have it sit there for a week? That is way less safe than WhatsApp,” she says.
The solution is billed per user, per month, to the employer. The price varies, based on what features are being used, but its lowest level product starts at R8. It costs R35 for the full suite of services.
Van Der Merwe says the earned-wage access service is usually used by less than half of employees, which allows them to draw down on their salary early, at a fraction of the cost of a payday lender or loan shark.
“People think that this is a potentially damaging product for the employees, or they prefer not to get involved in that side of things,” she says. But it’s a growing market and it seems to have a role to play in the average deskless worker’s life in South Africa.
The company is also planning to expand into other markets, with South- East Asia and South America seen as likely territories. In the meantime, there’s still a huge market to address in South Africa, and Jem is now serving about 160 000 employees locally.
Jem uses Google Cloud Platform, and has a database of its users, as well as what it calls the Jem Hub, where employers manage their HR workflows, such as sending payslips. But first, the employee data will need to ingested, which is done by an API or a flat file. Employees will then need to opt in, which they do with a two factor authenticated WhatsApp.
She says it usually sees about 70% of the workforce registering within the first few weeks of the platform being introduced at a company, and it “spreads like wildfire”. It has also developed its own tool to read and extract information from documents that employers upload. In the wage market, she adds, payrolls will typically run with a 5% error rate. “If you’re paid hourly, you’re checking that payslip every single month. With deskless workers, the company might have forgotten they worked overtime, or somebody marked someone’s sick leave as absent, and then you’re in trouble because you’re earning a minimum wage.”
Once a new payslip is released, the employee will receive an outbound WhatsApp message on a phone number saying, “Your employer has sent you a new payslip”. They could also get a video or a message or a voice note. Employees can reply to the WhatsApp, which will bring up a menu where they can see past payslips, book their leave, or apply for an earned-wage access transaction. Van der Merwe says they will often see people applying for earned-wage access at 2am, with the staff member realising they don’t have any money for transport to the site in the morning.
There is deep fragmentation in the market, she says. “What you’ll typically find in any organisation, even a small one, is that they have a hodge podge of tools. One division is using this, another is using that.” At the lower end of the market, where margins are extremely thin, there’s no budget for HR tools. “Often, the only software they’ll have is time and attendance and a payroll. Those often don’t talk to one another. Payroll is complex enough without having an inbuilt time and attendance module. Most of them don’t have both at once. Payroll is a very tough industry to succeed in, and it’s a race to the bottom with pricing.”
Large enterprises, meanwhile, may have complex systems, with information in different parts of the business, making it hard to track and manage employees. There has been a proliferation of international tools in recent years, such as Workday, or Salesforce, or SAP and its SuccessFactors, and “they’re wholly inappropriate for our market,” she says. They’re not addressing the digital literacy gap and day-to-day challenges that local companies face.
“Companies, despite their best intentions, end up having tools that work for the HR team, but don’t work for the frontline, and that’s the majority of their workforce.”
Jem is also using AI internally among its development team and non-technical staff, and is now hiring people with AI skills.
SAP EXPANDS GENAI COPILOT CAPABILITIES
SAP introduced its GenAI copilot, called Joule, in 2023, and it’s now being embedded in more of the company’s applications to help users find the answers they’re looking for among all their data.
Leo Richard Irudayam, senior SAP business technology platform solution advisor, SAP, says Joule can be used in a number of scenarios, such as a cash collection or dispute resolution agent, and will be able to answer specific queries in projects in their SAP system. Users can also pinpoint what was going awry in a project, and the agent will suggest steps to resolve the issue.
Speaking on the sidelines of the company’s Sapphire conference in Madrid earlier this year, Irudayam said the business landscape was becoming increasingly complex, particularly if factors such as global tariffs or risk classifications and sustainability metrics were added to the mix.
Joule can now act on the user’s behalf in other applications. In one example, a user may ask Joule to find out why there are cost overruns on a project. Joule will pull up a monthly bar chart of the project’s costs, showing the overrun had, for example, been caused by higher than budgeted staffing costs. “I need to hire someone to support me in getting this project back on track,” says Irudayam. He asks Joule to check who’s available from his firm to take over the project, based on their management skills and certifications. One candidate, “Marcus”, seems to be the best fit; Joule will then notify him, in his native Spanish, and will then schedule a meeting based on both parties’ availability. With the meeting scheduling, Joule will hand off the task to Microsoft Copilot, which has access to the participants’ calendars.
At present, users communicate with Joule via text, but SAP is working towards it supporting voice prompts. Currently, it supports text queries in English, German, French, Spanish, Portuguese, Japanese, Korean, Simplified Chinese, Vietnamese, Greek, and Polish.
Humans in charge
Irudayam says he thinks staff at SAP customers would rather use a copilot than continually ask a colleague for help. “If you’re new to a topic, you don’t want to bother a colleague for the third time, so you’ll try to do it yourself using a digital assistant.”
He acknowledges there may be some hesitancy in some customers over concerns that AI will render staff redundant, and that should be addressed. “But we’re focusing on assisting the human. We need to learn how humans interact with AI.”
Swedish fintech Klana fired 700 employees in its customer experience department because it thought AI would resolve cases better. “They failed, and had to rehire them,” he says. “The humans were continuously feeding the LLM knowledge. An AI can only be as good as the data it has. There’s a shortage of content being created by experts, and we’re wondering how we can fill this gap. We [humans and AI] have to collaborate.”
* Article first published on brainstorm.itweb.co.za
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