by Jen Wu
Most agree that effective teachers are the most important ingredient for enabling high-quality education. Unfortunately, providing high-quality teachers for all students is challenging. Our public school system faces teacher shortages in select geographies; in subject areas such as STEM, special ed, and bilingual education; in middle and high schools; and in high-poverty schools. We also struggle to hire teachers who reflect the diversity of our student population. Exacerbating these challenges is the high teacher attrition rate in the U.S.; every year 8% of teachers turn over.
Given these challenges and the mission-critical role of teachers, improving people practices at schools has significant potential for impact. In business, we see an increasing focus on hiring, developing, and retaining high quality employees as a key competitive advantage. In larger and more progressive enterprises, the traditional function of “human resources” has evolved into “human capital management,” (HCM) as the purview of HR broadens to include not just record-keeping and compliance but also performance. This transition has driven changes in management practices that touch the entire lifecycle of employees from hiring and onboarding, to employee engagement, career advancement and growth. Managers are encouraged to develop employee-centric, team-based cultures that empower employees to be collaborative problem-solvers and to drive their own career development. These innovative management practices translated into 402 investment deals in human capital technology startups in 2016, a record number, according to CB Insights.
We’re starting to see hints of the same forces at work in K-12. Given complex requirements unique to K-12 employees — e.g. certification verification, collective bargaining/contract renewals, substitute teaching workforce management, and education policy compliance — districts often rely on K-12-specific solutions. Historically, HR information systems have been back office workhorses whose main functions are to manage employee records, payroll and compliance. Our market map highlights how some K-12 HRIS players are broadening their offerings to become human capital management platforms that manage recruiting, evaluation, and professional development. In addition, the map highlights innovative point solutions that optimize or rethink just one aspect of the K-12 employee management process, e.g. recruiting or managing substitute teachers. In addition to mapping the K-12 space, we also map HCM solutions in the enterprise space as potential leading indicators for K-12.
HUMAN CAPITAL MARKET MAP TAKEAWAYS
- We see human capital management as an area with high potential for impact
- Market barriers — e.g. sticky legacy solutions, small and fractured market, people management requirements unique to K-12 — have limited innovation in the space to date, but have also set the stage as an area hungry for innovation
- At Reach, we’ve found opportunities in professional development and have made investments in KickUp and BetterLesson; both play into dynamics we see and value in the enterprise space
- Focus on educator empowerment and growth, not evaluation
- Focus on improving performance of both educators and students
- KickUp helps professional development departments be responsive to needs expressed by teachers
- BetterLesson enables more teachers to receive personalized coaching and feedback
- Other innovations we are excited to see:
- Substitute management (Swing, Parachute): making the process more efficient; taking advantage of the gig economy to surface latent talent; and using existing time and resources, not just to fill a gap, but to enhance student learning experiences
- Applicant sourcing (TeacherTalent): using big data to source best fit teachers for hard-to-fill openings
- School culture (Panorama, Upbeat): shining a light on school culture and creating effective and inclusive work environments to improve retention
- Our wish is to see more solutions that leverage technology to encourage and facilitate change in people practices and culture so that educators are empowered to collaborate, solve problems and drive their own professional growth