At the HR Tech Conference this week, Stacey Harris of Sapient Insights Group debuted the highly anticipated results of the 27th annual HR Systems Survey—highlighting the trends happening and coming down the pike in HR technology.

Among the headline makers was that this marked the first time in 15 years that HR respondents’ views on their ability to achieve their outcomes—across talent, HR and the business—declined for every measure.

“It’s something to be aware of—a conversation that we need to be having in the market,” Harris said. “It doesn’t mean all businesses are losing money, it doesn’t mean the market is all down. What it does mean is we in HR have to be in sync with what’s going on in the business, and we have to be aware of where we put our input and our insights to move forward.”

At the same time, investment in HR technology is staying steady.

Looking ahead, HR tech spending in 2025 is forecast to grow with organization size: Thirty-five percent of organizations with fewer than 500 employees plan to boost their HR tech budgets, compared to 53% of enterprise businesses with more than 5,000 employees. This year saw significant “diversity” in spending plans among different-sized organizations, Harris noted.

“Every business is realizing that even though things may be slightly down right now, ‘I can’t afford to let my HR environment drop,’” Harris said.

Focus on service, not just tech

How are organizations planning to shift their HR technology stacks in 2025? The HR Systems Survey data—culled from more than 5,000 respondents representing 3,318 unique organizations around the globe—found that tech buyers are most likely to make changes to their payroll and HRMS providers.

Ratings for user experience and vendor satisfaction were both down significantly for HRMS—by 6% and 3.5%, respectively. Payroll ratings—which also declined last year—dropped by 3.5% for user experience and 6% for vendor satisfaction.

Why are HR tech buyers unhappy? One respondent’s comment tells the story, Harris said: When asked their views on a vendor’s customer service, the individual responded: “What service?”

“I want that to sink in for every vendor in this room,” Harris said. Frustration with vendor service was a theme throughout the survey, she said. For instance, 64% of respondents told Sapient the reason they gave a poor vendor satisfaction rating was primarily because of customer service issues.

Harris advised HR tech buyers to rethink add-on services. While simply buying the tech itself may save the organization money, it’s a mistake not to “buy up” and purchase add-on services.

“Buying more HR tech is not going to get you the outcomes you want; buying services with it will get you a lot more,” Harris said.

See also: Josh Bersin’s top AI headline for 2025? It’s all about the agents

A changing market for HRMS, payroll

How do the major players compare when it comes to user ratings for experience and vendor satisfaction?

Enterprise orgs

Across both HRMS and payroll functionalities, Workday has topped the rankings for several years, but Harris noted there was a big uptick from SAP SuccessFactors.

Mid-market

Harris pointed to a significant “shake-up,” with isolved boasting higher ratings than Workday among payroll clients; however, she cautioned, survey respondents using isolved tended to represent organizations with fewer than 3,000 employees.

“Vendors aren’t just bringing great technology, but they’re bringing a whole conversation about services, and that’s where isolved falls in that picture,” she said. “We’re going to watch services conversations taking off in the mid-market space.”

The HRMS side of the mid-market is even more competitive, with HiBob leading the pack. The organization’s capacity to provide technology and services to global audiences is key.

“HiBob is very good at handling international needs,” she said. “These organizations appreciated the solution, but they also appreciated how it globally handled things for them. That’s the other battleground we’re going to see: How global is your solution?”

SMB

Rippling again earned top ratings among small- to medium-sized payroll clients, while companies like isolved and Intuit Quickbooks are also making waves in this sector.

The SMB HRMS market is “heating up,” Harris said, with Rippling also on top here and strong showings from organizations including BambooHR and Employee Navigator, which, “in two years, went from being a blip on the radar to one of the top vendors in the data set. This is not a market that’s going to stay the same very long,” Harris said.

The shifting role for HR technologists

In the last several years, the Sapient team has been closely watching one important metric: the percentage of respondents who say their HR function is viewed as contributing strategic value.

That figure jumped from 50% in 2023 to 52% this year, the biggest boost in the last several years—with a goal of “55 by ’25.”

“We’re almost there,” Harris said.

“People are doing things differently,” she said about HR’s elevating strategic role. Coming out of the pandemic, HR has been under significant pressure, and in just the last year or two, Harris said, “organizations have realized they cannot move forward with their business goals without the HR function at the center of that conversation.”

As HR becomes more strategic, goals for using HR technology are shifting—from keeping up with best practices and following “shiny object” syndrome to being driven by business outcomes. This year’s survey found a nearly 3% uptick in HR technology being used to make business decisions, which Harris said is a “big win” for the vendor community, signifying solutions that business leaders understand are “not easily replaced.”

The profile of the HR tech buyer and decision-maker is changing as much as the market. Over the last several years, the survey has found those in the HR technologist role typically have less experience—nearly 60% of those surveyed this year have been in the role for fewer than three years—while being asked to have more education and to take on more responsibilities.

“This role is no longer just a role of configuring and maintenance and integration,” Harris said. “It’s a strategic role inside the organization.”

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Download the full HR Systems Survey here. A portion of report sales this week will benefit cancer research, in honor of Harris’ mom, who was diagnosed with cancer.