ADP has a Platform for HRO Success
Last week, many of us covered announcements from the HR Technology conference. Among the new service news was ADP’s Vantage HCM SaaS and BPO platform, which was formally launched on October 3rd at HR Tech.
Vantage HCM covers HR administration, benefits, payroll, time and attendance, and talent management. It is an enhanced version of ADP’s successful Workforce Now platform, which was launched in October 2009 and already has more than 10,000 clients. ADP is estimated to have invested 18 months and $600m in the new platform. General availability is slated for March 2012 to allow time for full testing of critical high volume HR activities such as annual open enrollment and end-of-year payroll with 12 pilot clients from a variety of industries with 1,200 to 20,000 employees.
I see a bigger story here: ADP has built a business platform to support execution of its strategies. Here are several elements I see in play.
Support the core. ADP is adding new services while protecting and enhancing payroll, its single largest revenue generator. Payroll is built into the core package of each multiple process HR (MPHRO) system.
Serve your main markets. In payroll, ADP supports every size organization. Now, it offers MPHRO platforms for nearly every size organization: Workforce Now provides core HR needs for less than 3,000 employees; Vantage HCM covers more robust HR needs and talent management for up to 20,000 employees; and Global View supports large, multi-country organizations typically with more than 20,000 employees.
Leverage acquisitions. Vantage HCM talent management services include succession planning, performance management, and compensation management as the fruits of collaboration between ADP and Workscape, which was acquired last year.
Reuse development investments. Vantage HCM uses “plug and play” design for fast and easy additions, integration of new modules, or preferred partners, such as Cornerstone for learning. Access will be immediately available from multiple devices including smartphones, another benefit of development reuse.
Roadmap development and growth. Workforce Now and Vantage HCM are U.S. services. Both will be expanded to Canada, with Workforce Now ready in 2012. In the future clients will be able to choose the basic benefits module or Workscape services for more complex benefits needs.
Buy, build, and go. ADP prefers to buy or build for strategic growth services. It chose to build its own proprietary MPHRO systems. It acquires complementary service lines and players in geographies to quickly establish a beachhead with top tier players. Once it identifies a target, it moves fast, integrates new acquisitions and captures synergy savings. (ADP just announced acquisition of The RightThing for RPO. Acting fast indeed!)
Go your own way. Most MPHRO providers offer HR analytic packages as an added cost option. ADP is building in related data views, dashboards, metrics, and integrating workforce analytics use right at the point of need.
Do you have a business platform as broad and consistently used as ADP’s?
Linda Merritt, Research Analyst, HRO, NelsonHall
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