Posted tagged ‘NorthgateArinso’
May 3, 2013

Linda Merritt, HRO Research Analyst, NelsonHall
SaaS systems for HR administration and payroll have opened up the small business market to the benefits of web-based HR systems with self-service and easier implementations. The rapid uptake by clients is testimony that a ‘sweet spot’ has been reached in cost, ease and value.
MoorepayHR
I followed up with Anne Fitzpatrick, Moorepay managing director, for an update on how MoorepayHR, a cloud-based SaaS payroll and HR administration platform with BPO services, is doing one year after its launch in the U.K. small business market.
Moorepay, a NorthgateArinso (NGA) subsidiary, is already “large” in the U.K. small business market with >10,000 clients. However, past success does not guarantee future success. The company saw the need for an integrated HR and payroll platform and wanted to achieve this in its own way by combining new technology with its existing BPO managed payroll and HR services, including on-hand subject-matter experts for guidance on employee issues, into a business process as a service (BPaaS) service.
At first there was some concern if the market was ready for a SaaS multitenant cloud service. Moorepay quickly found that buyers understand the cloud based on their own experiences as consumers and were actually eager for the new service. By the end of April, MoorepayHR had signed its 1,000th customer, and this week the entire company is holding a company-wide celebration!
The client base is 80% new and 20% from existing clients.57% of clients add on payroll, and even more select one or more of the BPO options, led by compliance support for employment law and health and safety advisory.
Moorepay will be adding more offerings to the system, including a newly-released ‘lite’ version. Next for the company is the rolling-out of an advanced version that adds functionality for recruiting, performance management and learning. Targeted at businesses with up to 500 employees, MoorepayHR will be expanded to up to 1,000 employees in the near future.
RUN Powered by ADP
ADP first introduced its RUN system nationally in the U.S. in 2010 for the very small market (1-49 employees). More HR features and payroll functionality have been added to the SaaS cloud-based mobile platform on a regular basis. In addition to ease-of-use, RUN offers a 24×7 help desk with certified HR professionals and an online HR library. RUN added its 200,000th customer in April 2013.
Two Vendors, One Success Story
Both Moorepay and ADP understands that clients of any size have similar needs. As Anish Rajparia, president of ADP’s small business services division, commented: “Small business owners demand flexible tools and resources tailored for them to help manage the risks associated with running their business.”
There are already a variety of options in the market for the small business owner and I am sure we will see many more. One size never fits all, and I am pleased to see that this class of buyer now has HRO choice.
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Categories: HR, HR Administration, HR BPaaS, HR BPO, hr outsourcing, hr outsourcing research, HR SaaS, HR shared Services, HR Systems, HR Technology, hr tools, HRO Growth, HRO providers, hro research, HRO Service Provider, HRO Services, Moorepay, MoorepayHR, Multi-Country Payroll, Multi-Process HR Outsourcing, offshore outsourcing providers, offshore providers, outsourcing, outsourcing research, payroll outsourcing, SaaS
Tags: ADP, bpo, BPO managed payroll, Business, Cloud computing, HR administration, nelsonhall, NorthgateArinso, payroll, payroll outsourcing, SaaS payroll, self-service, software as a service, web-based HR
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March 14, 2013

Linda Merritt, HRO Research Analyst, NelsonHall
The HR Outsourcing Association (HROA) just completed a series of webinars on SaaS and HR BPO. There was a wide range of HROA industry experts bringing their real world experience on each panel including Accenture, ADP, Aon Hewitt, Futurestep, IBM, ISG, NorthgateArinso, Oracle/Taleo, and more.
SaaS or BPO is Not the Question
The conversation was largely about the difference between SaaS and the ERP systems included in most current BPO deals. It was not about using only SaaS or only BPO. SaaS can and does fit into BPO. I expect to see lots of growth in SaaS and BPO combinations in the next few years as SaaS platforms scale and grow in handling complexity.
SaaS is a Success Story of Innovation
The rise of SaaS was also fueled by the recessionary pressure to lower HR costs. Pre-downturn, HR leaders strongly preferred the customization power of ERPs to conform to a client’s policies and processes. Now the acceptance of the speed and economic advantage of configuration and standardized processes makes SaaS a viable option for an increasing array of HR services and even HR management system infrastructure (HRMS).
BPO service providers are also prime sources of many SaaS applications:
- SAP and Oracle offer cloud HRMS used as the core for most HRO platforms such as: Genpact Hosted HRMS Platform, Infosys TalentEdge, CGI Oracle HCM, Caliber Point Republic, TCS HR platform
- Proprietary systems include: ADP Vantage HCM and Workforce Now, NorthgateArinso ResourceLink Aurora, Preceda, and MoorepayHR, Ceridian DayForce and HRevolution
- Talent management applications including RPO services have been so popular that Oracle snapped up Taleo, IBM acquired Kenexa, and SAP bought SuccessFactors.
Selection and Implementation Commonalities
The buyer experience has common elements whether selecting SaaS or BPO.
- The upfront client planning process is the same: identify goals and objectives aligned with business and HR strategies; gather cost, process, and performance data to build a business case; consider enterprise risk; etc.
- Vendor selection: do not just select the service; ensure there is a proven record of vendor performance and solid evidence of collaborative client relationships.
SaaS is not Self-Installing
While the total time and effort may be less, all the traditional elements remain. Webinar panelists warned that even if the decision has been made to use SaaS, do not underestimate the time and effort to make a vendor selection, manage change, gain buy-in, and project management implementation.
Even though one of the advantages of SaaS solutions is faster and “easier” implementations, it will still take buyers time and effort to standardize processes and data and to determine the configurations. Make sure that as a buyer, you know and plan for the skill and effort needed. Like BPO, experience says to consider a phased in rollout starting with one service / process and bring the learning forward to the rest of the implementation.
Next time, we will explore to SaaS or not to SaaS.
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Categories: HR BPO, HR Outsourcing Association, HROA, SaaS
Tags: Accenture, ADP, ADP Vantage HCM, ADP Workforce Now, Aon Hewitt, Caliber Point Republic, Ceridian HRevolution, Ceridian InView, CGI Oracle HCM, Futurestep, Genpact Hosted HRMS Platform, HR management system infrastructure, HRMS, IBM, Infosys TalentEdge, ISG, Kenexa, NorthgateArinso, NorthgateArinso MoorepayHR, NorthgateArinso Preceda, NorthgateArinso ResourceLink Aurora, Oracle, Oracle Taleo, rpo, SaaS and HR BPO, SaaS applications, SAP, SuccessFactors, talent management, talent management applications, TCS HR platform
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November 20, 2012

Gary Bragar, HRO Research Director, NelsonHall
I attended HRO Today Forum Europe in Dublin, Ireland from November 13th to 15th to present my “State of the Learning BPO Marketplace” analysis and to introduce subsequent speakers of the learning track.This conference was different than those I’ve attended in the past as several of the sessions were interactive small group discussions. The small groups allowed us to learn from each other, and created energy and enthusiasm!
Interactive sessions I attended included:
- The opening recruitment session where we identified top challenges and solutions
- A leadership development program workshop to identify top challenges and solutions.
There were ~260 registered attendees (the same as in Amsterdam two years ago), of which 87% were in attendance throughout the three days including ~50 HR practitioners. Here are some of the highlights from the forum:
Opening remarks: Elliott Clark, CEO of SharedXpertise, opened the conference by sharing some enlightening data from a recent survey, primarily Europe centric:
- Twice the percentage of providers think HRO is thriving compared to buyers
- 77% of vendors think M&A is good for HRO compared to 55% of buyers.
Opening keynote: David Andrews, CEO of AOI and founder of Xchanging, presented “Reshaping the HR Business and Lessons Learned from Across Europe.” David began by talking about the history of HR BPO and how BP was the first company to sign a major HRO contract with Exult in 1998 to obtain 40% cost savings to remain competitive. David’s concluding remarks were that the outsourcing space in the U.K. needs to be bigger since ~$18bn is spent by the U.K. government on back-office processes and only ~$700m is outsourced.
Panel discussion: “State of the Market Debate” was hosted by David Andrews and participants included Accenture, IBM, Logica, NorthgateArinso, and Xchanging. Margaret Spink, Managing Director of HR Services at Xchanging, stated SaaS will be the most important phenomenon in the industry and the mid-market will be the biggest growth area. I agreed with Margaret’s mid-market comment, but spent the next day wondering about SaaS until the Xchanging hosted breakfast when Margaret stated that HRO is not just about technology – I couldn’t agree more! Technology is an enabler and I believe more focus should be on implementation, process, utilization, effectiveness, and achievement of desired outcomes.
General session: The conference concluded with a payroll presentation led by Julie Fernandez of ISG followed by a panel that included SD Worx, Ceridian, and CloudPay. The focus of Julie’s presentation and panel were on multi-country payroll beginning with the benefits that include:
- Reduced number of payroll providers for better procurement pricing and contract terms
- Consolidated interfaces to HR
- Improved visibility and reporting of employee headcount and cost
- Reduced compliance and financial risk
- Harmonized payroll processes and improved governance.
Challenges of multi-country payroll include securing buy-in of all the countries and funding. Part of the challenge is the implication that all countries must fit one model using one provider. All three panelists use partners in countries where they are not able to provide service themselves.
Q&As from the multi-country payroll session included:
- Q: How do you get internal finance to have confidence in the provider to prevent an extra layer of checking on vendor performance?
- A: CloudPay stated that multi-country payroll reports into the client CFO and that one way to satisfy finance is for the vendor to do more self-audits and disclosure.
An interesting discussion also took place on “cloud” with the panel in agreement that the true meaning is you can do anything from anywhere for anything, but that the industry is not there yet due to the concern of knowing where data resides. The industry will, however, grow into acceptance.
In sum, it was a worthwhile conference for anyone interested in learning, networking, and meeting potential clients. I look forward to HRO Today Forum Europe 2013 in London, November 12th to 14th, expected to be the biggest event yet.
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Categories: HR BPO, hr outsourcing, hro, HRO Today, HRO Today Forum, HRO Today Forum Europe, Learning BPO, Value of HRO
Tags: Accenture, AOI, BP, Ceridian, CloudPay, David Andrews, Elliott Clark, Exult, HR BPO, HRO Today Forum Dublin, HRO Today Forum Europe, HRO Today Forum Europe 2013, IBM, ISG, Julie Fernandez, leadership development program, learning BPO, learning track, Logica, Margaret Spink, mid-market, multi-country payroll, NorthgateArinso, payroll, recruitment session, Reshaping the HR Business and Lessons Learned from Across Europe, SaaS, SD Worx, SharedXpertise, State of the Learning BPO Marketplace, State of the Market Debate, Xchanging
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November 13, 2012

Linda Merritt, HRO Research Analyst, NelsonHall
A deeper dive into business continuity planning (BCP) will wrap-up the series on how HRO can help clients during a crisis.
As a HRO buyer, in addition to knowing the plans for transferring services to back-up systems and centers, it is as important to know that your account team will be ready, capable, and dedicated to keeping you and your employees serviced.
Communication and Partnership
Aon Hewitt, Mercer, NorthgateArinso (NGA), and Xerox all stressed the need to communicate early and often with their clients in preparation and throughout a disaster.
- “No surprises” is important in an emergency and Mercer began its outreach to clients the Friday before the storm made landfall on how to help meet client needs and to provide updates on Mercer’s plans and preparations.
Disaster Central
Coordination in a crisis is critical when normal operations and lines of communications maybe disrupted.
- Using its prepared playbook, Xerox sets up a situation room and cross-functional team for handling major events and any contingency needs that arise.
- For several days after Superstorm Sandy, the Xerox New Jersey HRO office was inaccessible with no power and impassible roads. While designated critical personnel were able to work remotely, normal operations shifted to the partner team in Manila and service levels were maintained throughout including the transfer back to New Jersey.
- Xerox knew that it wasn’t enough just to have a generator since it would need fuel for perhaps an extended time. It, therefore, already had contracts in place with local suppliers and was able to get fuel and transportation when others couldn’t. In addition to fuel deliveries, Xerox had a bus available to pick up employees from several designated locations.
Practice Makes Perfect
Testing is what makes BCP more likely to work in the real world where no matter how good the plan, unexpected events will occur. Ask how often BCP is reviewed, updated, and tested.
- NGA holds surprise BCP tests where no one knows in advance it is coming or the scenario used for the mock disaster.
Aon Hewitt’s BCP covers specific needs by location, skills and knowledge coverage, and technology back-up. Cross training in advance helps Aon Hewitt ensure the back-up buddy team will be prepared for specific client transactions.
Individualize
Needs vary by client and some may be in different parts of the HR monthly or annual cycle which impacts the services needed during an emergency.
- An NGA client planning for a new system go-live on January 1st did not want a delay because of Sandy but needed to pull some of its own team away from implementation. NGA was ready and able to step into the gap and is providing the client some peace of mind in difficult circumstances.
Business continuity and disaster recovery can and should be a decision factor in the HRO vendor selection process as it illustrates both sides of HRO, operational excellence, and the care and concern that sets HR and HRO apart from other services.
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Categories: Business Continuity Planning, Crisis Planning, Disaster planning, hr outsourcing, hro
Tags: Aon Hewitt, Business Continuity, cross-functional team, disaster recovery, hro, Manila, Mercer, NorthgateArinso, operational excellence, Superstorm Sandy, Xerox
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November 9, 2012

Linda Merritt, HRO Research Analyst, NelsonHall
Some think caring emergency response may be compromised by HRO, but response capabilities can be better with HRO. Major vendors have multiple service centers and back-up capabilities at levels above what is economically feasible for most organizations. Also, customer care and concern abounds when HRO vendors maintain an internal culture that values and recognizes customer service.
Care and Concern
Experienced HR people make up much of the client-facing service representative staff at HRO vendors of every sort and HR people are wonderfully caring folks, whether they are on your payroll or a service provider.
- Being There: As mentioned in Part 1, Mercer was prepared in case they took a direct hit from Superstorm Sandy in the Boston area. When needed, Mercer will put up available service personnel in nearby hotels. Even though some folks were personally impacted, 75% of the staff showed up on Monday and 90% showed up on Tuesday.
- The Spirit of Service is Global: Jodi Hayes-Roth, North American Service Delivery and Operations Leader at NorthgateArinso (NGA), said their representatives feel very loyal and connected to their clients and make every effort to be present even though there are back-up centers available. The spirit of service is as strong in client service centers like Manila as it in the U.S. or Europe.
Practice What You Preach
To have staff remain dedicated to their clients, they need to be treated with the same care and concern. Both NGA and Xerox have client service centers in the Philippines where typhoons and monsoon flooding can impact business services and personal lives. A great business continuity plan (BCP) addresses both issues.
- Outreach: When the NGA Manila office was impacted by flooding, there was outreach to contact and ensure every employee was safe and accounted for and the team raised funds to help co-workers in need.
- Safe Shelter: Michael Sigmund, General Manager of Operations at Xerox, recounted what happened when a monsoon hit the Xerox Manila service center that supports many of Ford’s global employees. The building is built with hurricane-standard materials and a generator back-up system and there are sleeping quarters to provide safe shelter for staff and their families. While work can be shifted to the partner center in Michigan, Xerox invested in keeping local employees safe and the employees wanted to support their customers. Even though short staffed, they kept tier 1 services operating while some tier 2 work was transferred. In return the team was recognized at a Ford leadership meeting.
There are many more stories out there of people working anywhere they could find Wi-Fi, getting to work without transportation, and carefully monitoring transfers to protect service levels even in the midst of a declared multi-state disaster.
Recognition of people that demonstrate a high sense of ownership is important. Aon Hewitt, Mercer, NGA, and Xerox all shared great examples from formal to informal and local to enterprise-wide recognition that they provide.
Stay tuned next week for more on HRO business continuity planning.
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Categories: hr outsourcing, hro, HRO providers
Tags: Aon Hewitt, business continuity plan, client-facing service, Customer Service, Ford, hro, Jodi Hayes-Roth, Manila, Mercer, Michael Sigmund, NGA, NorthgateArinso, Philippines, Superstorm Sandy, Xerox
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October 4, 2012

Linda Merritt, HRO Research Analyst, NelsonHall
Moorepay is a payroll and employment service provider in the U.K. with over 10,000 clients and it is a part of NorthgateArinso (NGA). Earlier this year I blogged about the launch of its new HR and payroll platform service for the small employer market in the U.K. This week, I spoke with Ann Fitzpatrick, Moorepay managing director, for an update.
In a brief recap, MoorepayHR is a cloud-based SaaS and BPO service built on NGA’s Preceda SaaS platform that is customized for the U.K. market and combined with Moorepay’s payroll and HR services such as employment law and health and safety advisory.
Cloud Opens the Small Employer Market
Most major HRO vendors do not attempt to reach the small employer market, which is just what Moorepay serves. Certainly small employers want professional and modern services, but until the rise of streamlined HRO platforms in the cloud, the costs were unaffordable for both clients and vendors. In the U.S., ADP has had such great success with Workforce Now, it launched a larger version called Vantage HCM. Now, employers in the U.K. can have the same level of service as larger companies at very affordable price points.
The Roadmap to Success
There are three levels of service, each with its own pricing openly displayed right on the company’s website. Payroll is available as an option with each of the service levels. Approximately 40% of clients are currently adding payroll. In a bit of a nice surprise, ~80% of customers are choosing the highest level that comes with client services, making it a real BPO offering.
A 1Q 2013 launch is planned for the highest level of service, HR Advanced, which will add modules for talent management, recruiting, and remuneration. That will make the service more valuable for employers in the 100-400 range with more complex HR needs.
With its large base of payroll clients, Moorepay will later market the new system and services to its existing clients to allow conversion to the new system and added services.
Finally, Moorepay is receiving good support from the NGA Preceda team and they will work together to ensure the technology development roadmap is completed in the near future, including mobile and tablet access.
The Proof is in the Pudding
The new system has just reached its three-hundredth customer and all of these customers are new to Moorepay. The company now has a solid base of wins and users to move forward with its multi-stage approach to growth.
The small employer market is clearly hungry for such a service. Even before launch, there were hundreds of inquiries, and the number of inbound leads has rapidly increased. You know something is going well when customers are lining up at your door!
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Categories: Cloud, HR Systems, HR Tech, HR Technology, HRO Platform, Moorepay, MoorepayHR, NGA, NorthgateArinso, payroll outsourcing, U.K.
Tags: ADP, ADP Vantage HCM, ADP Workforce Now, Ann Fitzpatrick, bpo, cloud, complex HR, employment, employment law, health and safety advisory, HR Advanced, HR platform, HRO vendors, mobile, Moorepay, MoorepayHR, NGA, NorthgateArinso, payroll, payroll platform, Preceda, recruiting, remuneration, SaaS, small employer, small market, tablet, talent management, UK
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August 15, 2012

Linda Merritt, HRO Research Analyst, NelsonHall
There was a good amount of announced HRO contract awards of many sizes and services in the first half of 2012, especially in the large market. A nice volume of new work coming online will provide future revenue support for HRO service providers, where earnings have recently been lower than in 2011.
Learning: finally announced some major deals including:
- Capita Workplace Services: awarded a competitive win for a £250m contract by the Cabinet Office to manage civil service training services in the U.K.
- Serco: won awards with the Army in both the U.K. and the U.S.; it won a scope extension valued at $38m by the U.S. Army and a £55m training contract by the British Army
- Genpact: won a learning services contract by Johnson Controls, extending its record of recent learning wins; last year, it won a 7 year MPHRO contract with Nissan that included learning and it also won a 5 year content development contract by JobSkills in India.
MPHRO: activity was spread around nicely with ADP, Aon Hewitt, NorthgateArinso, and Logica all bringing in MPHRO contracts. One notable deal was IBM’s multi-tower BPO and IT deal with Cemex valued at $1bn; it includes finance and accounting BPO, HR BPO, IT infrastructure management, application development, and maintenance.
RPO: continued to see a high volume of new contracts spread across many vendors. There were also two of the largest awards ever in RPO:
- ManpowerGroup: awarded a $400m five year contract extension with the Australian Defense Force, continuing a relationship that started in 2003
- Capita: won a £440m 10 year recruiting partnership contract by the British Army; it will also deliver supporting technology for the Royal Navy and the Royal Air Force, partnering with advertising agency JWT for recruitment marketing and with Kenexa for assessment and recruitment technology.
Benefits administration: contract awards were announced by Aon Hewitt, Empyrean, HP, and Xafinity Paymaster. Fidelity Investments reported the highest volume with DC contracts adding 522k new participants to its base of over 15m participants served. It also made major renewals and brought in new competitive wins. This is Fidelity’s strongest first half sales period in the last five years.
Payroll: deals in the U.K. led the way with awards going to Ceridian, Equiniti ICS, Liberata, and Mouchel. ADP won a multi-country contract from HP and will implement its GlobalView for payroll and Enterprise eTIME system for time and labor management for ~130,000 employees across 40 countries in Asia Pacific (excluding India), Europe, and the Americas (excluding U.S.) over the next five years.
With pipelines still healthy, the second half of 2012 should bring in a year of solid HRO growth and results. Congratulations to all!
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Categories: benefits administration, hr outsourcing, hr outsourcing research, hro, HRO Activity, HRO contracts, HRO providers, hro research, HRO Vendors, lbpo, MPHRO, New Contract Activity, payroll outsourcing, recruitment process outsourcing
Tags: 1H 2012, ADP, Aon Hewitt, assessment and recruitment technology, Australian Defense Force, benefits administration, British Army, Cabinet Office, Capita, Capita Workplace Services, Cemex, Ceridian, DC contracts, Empyrean, Enterprise eTIME, Equiniti ICS, Fidelity Investments, Genpact, GlobalView, HP, HR BPO, HRO contracts, IBM, JobSkills, Johnson Controls, JWT, Kenexa, learning outsourcing, Liberata, Logica, ManpowerGroup, Mouchel, MPHRO, multi-country payroll, multi-tower BPO, Nissan, NorthgateArinso, payroll, payroll outsourcing, recruitment marketing, Royal Air Force, Royal Navy, rpo, Serco, U.S. Army, Xafinity Paymaster
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June 15, 2012
Asia Pacific is the emerging market of the most interest to HRO service providers, especially RPO vendors. Most of the big names in HRO/RPO are building or expanding scale there to take advantage of the higher than average growth rates. ADP and NorthgateArinso are well-established in the region, and Futurestep, GP, Kenexa, ManpowerGroup, Mercer, and Towers Watson have all made recent acquisitions in China, Hong Kong, India, and Australia as the fastest way to get more feet on the ground in this expanding market.
Still considered an emerging market, some Asia Pacific countries are already mature including Australia and Japan, while others are truly experiencing the first rush of growth. Each country has different needs and challenges and HRO service providers need to bring a lot of service line experience and local knowledge to the table. While one industry needs a high volume of entry-level employees to meet demand, another, a bit further on the maturity scale, needs management-level employees with the experience to manage and continue growth of a more complex enterprise.
Newer entrants should not forget that there are regional providers already on the ground; one of the largest is Talent2, which covers the entire area and a bit beyond. Talent2 has continued its solid pace of contract wins across the Asia Pacific region. An example from the public sector is contractor procurement and management for 13 agencies of the Queensland government. In the private sector, contract wins included payroll, RPO, and learning, and cover Australia, China, Hong Kong, Japan, Malaysia, and even the Middle East.
With ~1,700 employees, Talent2 supports 30 countries in 30 languages from its 46 offices and service centers located across 19 countries. With its scale and services it should be no surprise to find that Talent2 is, according to NelsonHall, the HRO leader in Asia Pacific.
Perhaps it is reasonable then that Talent2 has attracted interest from investors wanting to take it private. Morgan & Banks Investments (MBI) and Allegis Group have entered into an agreement to acquire the company, which will remain operationally as Talent2 if the deal is successful. MBI represents current major stakeholders and Allegis is already a Talent2 RPO partner. It will be interesting to see if privatization allows Talent2 to fuel even more growth in and outside of the Asia Pacific region.
Linda Merritt, HRO Research Analyst, NelsonHall
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Categories: Asia Pacific, HR BPO, hr outsourcing, hro, Talent2
Tags: ADP, Allegis Group, Australia, China, emerging market, expanding market, Futurestep, GP, Hong Kong, HRO service provider, India, Japan, Kenexa, learning, Malaysia, ManpowerGroup, Mercer, Middle East, Morgan & Banks Investment, newer entrants, NorthgateArinso, payroll, Queensland, regional providers, rpo, RPO partner, RPO vendor, Talent2, Towers Watson
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May 10, 2012
Every quarter, my colleague Amy Gurchensky surveys HRO vendors for the NelsonHall HR Outsourcing Confidence Index (HROCI), which is then available for our clients and the participating service providers. In normal times, the HROCI does not change drastically from quarter to quarter; it more shows changes in trends over time. In uncertain times, however, it is a timely way to see changes in market perceptions even before disruptions occur in contract values, volumes, and revenues.
It is of some comfort that the HROCI is in a steady state of small changes from quarter to quarter. That is not a sign of upcoming exuberant growth, but it is a predictor that we will continue to see solid continuous HRO growth throughout 2012.
The most recent HROCI shows a vendor confidence level of 153, where 100 represents unchanged confidence and higher scores indicate increased confidence. While 153 is down a bit from 164 in 1Q 2011, it is in line with 3Q and 4Q 2011 at 151 and 147 respectively. Vendor confidence is often based on how current business is going, along with the pipeline. In HRO, growth from existing clients is just as important as new business. Ever since deals got smaller in scale and scope, there has been increased focus on retaining and growing existing accounts, and we see positive vendor confidence here as well.
Looking at some of the HR lines of service, payroll is once again in the leading position for growth, followed by RPO, multi-process HRO (MPHRO), benefit administration, and learning. MPHRO is expected to perform well in 2012, primarily driven by the need of organizations to standardize HR services across regions and geographies. Vendors such as ADP and NorthgateArinso that previously offered primarily payroll and employee administration services have been very active in acquiring or partnering to extend capabilities to a wider range of platform-based MPHRO functions. In addition, Logica is becoming increasingly successful in this space in Europe.
There is a slight tempering of growth expectations that can be seen in the data, although pipelines still seem solid. I think this is the same kind of hedge-your-bets thinking that is in the larger economy and what we are seeing from HRO buyers. Everyone still has a healthy sense of caution in case things suddenly go sideways.
Luckily, more and more HRO buyers and clients are willing to move ahead and get on with doing business, even if a bit cautiously. Other buyers still suffer from frozen decision-making and unwillingness to make long-term investments. Buyers with clear direction for what they want to achieve through HRO are the most likely to be deal ready – as along as prices are right and there is not too much upfront investment. The earlier service providers can assess readiness, the faster they will be able to fill pipelines with well-qualified prospects.
Linda Merritt, HRO Research Analyst, NelsonHall
Interested in reading the latest HRO news from NelsonHall? Subscribe to our newsletter by emailing amy.gurchensky@nelson-hall.com with “HRO Insight” as the subject.
Categories: benefits administration, Employee Administration, hr outsourcing, hr outsourcing research, hro, HRO Buyers, HRO Confidence Index, HRO Growth, learning outsourcing, multi-process hro, nelsonhall, payroll outsourcing, recruitment process outsourcing, Vendor Confidence
Tags: ADP, Amy Gurchensky, benefits administration, Employee administration, Europe, HR, hr outsourcing, hr outsourcing research, hro, HRO Confidence Index, HRO Growth, HRO providers, hro research, learning BPO, Logica, MPHRO, nelsonhall, NorthgateArinso, rpo, Vendor Confidence
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May 8, 2012
I found my attendance at last week’s HRO Today Forum to be very worthwhile. I presented my newly published research on the “State of the Learning BPO Marketplace,” including the emergence of social learning. While there, I took full advantage of attending many of the other sessions and meeting with several companies including: The Good Jobs, KellyOCG, Pinstripe, Randstad Sourceright, Kenexa, Aon Hewitt, Raytheon Professional Services, NorthgateArinso, Seven Step Recruitment, and Hays. Here are some of the highlights from the forum.
The Good Jobs: The Good Jobs is an online service that allows job seekers and employers an innovative way to find each other. Employers not only advertise job opportunities, but also their employment brand, culture, and corporate values to candidates. Job seekers can identify their life and work style priorities, and target those employers who meet their needs. Matching talent desired to employer desired will lead to employee engagement and retention in addition to business results, including increased productivity and lower cost by reduced attrition. No surprise The Good Jobs won the iTalent competition.
Where do Jobs Come From Panel: This panel was led by Prudential HR SVP Sharon Taylor and included Brink Lindsey from the Kauffman Foundation; Scott Case, CEO of Startup America; and John Haltiwanger from the University of Maryland. A few interesting data points from this session included the following:
- 90% of companies are small, but 65% of employees work for large companies
- 2003 – 2007 saw high job growth averaging 200,000 hires per month but it was not as strong as the 1990s
- From ~1977 – 2003, there were only 5 years that job growth exceeded layoffs for non-start-up companies, i.e. a net creation in jobs
- I missed the time period, but the point was that more jobs have been created in startups (3.5m) vs. established private sector companies (2.5m)
- The fastest growing businesses are also the most profitable.
Is Outsourcing Good for America Debate: Interesting points from the pro side included:
- 90% of outsourcing serves companies outside of the U.S.
- 95% of world consumers are outside of the U.S.
- 90% of what is made abroad gets sold abroad
- Foreign companies invest more in the U.S. (e.g. Honda, Nissan, BMW) than the U.S. invests abroad (it’s a 2 way street)
- The U.S. tax rate is one of the highest in the world adding to why some companies shift a portion of their business and jobs offshore.
Congratulations to all Bakers Dozen MSP winners led by Randstad Sourceright, Staff Management, Allegis Group Services, Adecco Solutions Group, The Bartech Group, Guidant Group, Advantage xPO, KellyOCG, Hyphen, Agile 1, Yoh, Hays Plc, and WorkforceLogic.
Congratulations to HRO Award recipients including providers NorthgateArinso, Pinstripe, Aon Hewitt, KellyOCG, and Evolv, Inc.; provider executives Cynthia Crose of IBM and Mike Ettling of NorthgateArinso; and buyer executive Chris Payton of Bank of America.
Gary Bragar, HRO Research Director, NelsonHall
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Categories: HR BPO, hr outsourcing, hro, HRO Today Forum
Tags: Adecco Solutions Group, Advantage xPO, Agile 1, Allegis Group Services, Aon Hewitt, Guidant Group, Hays, Hyphen, IBM, KellyOCG, Kenexa, learning outsourcing, NorthgateArinso, Pinstripe, Randstad, Randstad Sourceright, Raytheon Professional Services, Seven Step Recruitment, Social Learning, SourceRight Solutions, Staff Management, The Bartech Group, The Good Jobs, WorkforceLogic, Yoh
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