HR Tech Another Success: Part 2

Gary Bragar, HRO Research Director, NelsonHall

In my blog earlier this week, I wrote about highlights from the new Outsourcing Track at HR Tech as well as the RPO meetings I attended. In related news, my fourth global RPO market analysis report was published on Monday.

In addition to walking through the exhibit hall and attending technology demonstrations, my additional meetings at HR Tech included:

• Patersons: Its 2012 revenue growth is 70% YTD, driven by multi-country payroll. Safeguard World International has also reported similar success due to high growth for multi-country payroll services according to a business update two weeks ago.
• IBM: The company is experiencing increased demand for its RPO and learning services and many of its key learning clients have renewed in 2012. New learning contracts include one in South Africa and pipeline activity includes a large global bank. The Kenexa acquisition will bring in new RPO and talent management opportunities that IBM will enhance with its social and analytics capabilities.
• Hogan Assessments and SHL Assessments: Both companies provide personality assessments to predict work performance. SHL has also issued a talent management report with key findings showing that Eastern Europe ranks 1^st in supplying IT and essential business skills; the U.S. ranks 23^rd.
• Secova: The benefits administration provider offers online enrollment, a 24/7 call center, eligibility verification, billing management, and leave management services that are delivered from their ISO/IEC 27001:2005 certified platforms. Services are provided from California, New Jersey, and Chennai.
• Equifax Workforce Solutions: This was formerly operating as TALX, which rebranded as a result of its increased emphasis on the provision of workforce analytics and business intelligence to help clients improve their company’s performance.
• HireVue: Offers a Digital Interview Platform that saves time, travel, and costs by allowing clients to create online interview guides with scientifically proven questions. Candidates then record answers via a webcam, which recruiting and hiring managers then view on demand, including from smart phones, to build digital talent pools.
• JobVite: Provides a modular SaaS-based recruiting platform for applicant tracking, recruiter CRM, and sourcing talent.

Highlights from ADP include having ~30,000 clients for its cloud-based HCM platforms including:

• ADP Workforce Now: Launched in October 2009, it supports clients with 50 – 1,000 employees. The majority of its 20k+ clients purchase the broader HCM suite.
• ADP Vantage HCM:Piloted in October 2011 with general availability launched in June 2012, this platform, which targets employers with >1,000 employees, already has >30 clients. ADP has been adding ~5 – 6 new clients a month with a high percentage buying talent management, benefits (H&W), and time & attendance in addition to payroll. New wins include:
  • A national restaurant chain with ~24,000 employees
  • An employee healthcare staffing company with 15,000 employees
  • A retail chain with 4,500 employees.
• ADP GlobalView: It now includes ADP Talent Management globally and has won several major clients including an electronics manufacturer with 85,000 employees in 29 countries including the Americas, EMEA, and APAC, which recently added the compensation module.
• ADP Talent Management: It provides recruiting, performance, learning, compensation, and succession in 14 languages and 80 currencies for ~4,000 clients.
• ADP Mobile Solutions: Deployed globally and offered in 12 languages, the app has ~30,000 clients and ~450,000 users.

See you all next year at HR Tech in Las Vegas October 7 – 9, 2013.

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The Intricate World of HRO Provider Partnerships

It is uncommon to see a multi-process HR outsourcing (MPHRO) provider with a go-it-alone strategy.  Beyond the services a particular MPHRO service provider considers core, you will usually find other select HRO vendors. The option to operate in a networked HRO supply chain environment can be a valuable choice.  Some benefits include:

• Providing clients with the option of selected best-of-breed software applications with the primary provider managing the interfaces and integrations under one contract
• Investing in what the MPHRO vendor does best and offering a wider range of service options through partnerships
• Entering new geographies faster with less investment, an option especially seen in knitting together global payroll and increasingly in multi-country RPO
• Buying time to develop more robust internal offerings
• Creating a pool of potential investments or M&A targets.

This week, NorthgateArinso (NGA) and Workday announced a partnership to bring multi-country payroll to the Workday cloud.  Workday 16 customers will have the option to access NGA’s payroll processing capabilities in 51 countries through NGA’s new euHReka Inclusion Framework.

Workday, launched in 2006, is one of the first and largest start-ups to provide a SaaS-only HR ERP. Revenues are estimated to be  ~$150m this year with ~210 customers, most in the mid-market, but some are large market clients with 55k to 100k employees.  Still U.S.-centric in revenues and clients, Workday is expanding into the U.K. and Canada and plans to expand further in Europe in 2012. Workday is in a fast growth mode, targeting a 100% increase in revenues for 2012. It is busy selling, implementing new clients, and building out a full suite of HR and financial cloud-based ERP services. In the meantime, it can offer clients greater options via its partner network. In addition to NGA, other partners for multi-country payroll include ADP, Patersons, and SafeGuard World International.

Another example comes from Ceridian, which is expanding its investment and service partnership with Dayforce. The two have been partnering since 2009 to offer InView, a platform SaaS solution that blends Ceridian’s payroll, human resources, and benefits administration offerings with Dayforce’s workforce management software application. The expanded InView HR and Self-Service is to be released in 4Q 2011 and new payroll functionality is on track for 1Q 2012.

InView is starting out quickly as a successful partnership. Ceridian set a target of 300 clients for the first year and exceeded that number in six months. As more clients go live, the partnership will have to carefully balance service with growth to ensure long-term success.

HRO vendor partnerships are not always successful and must be carefully structured and managed, especially when the vendor partners may well compete with one another in some markets or services. With care, this can be a strategy with benefits for clients and the HRO vendor partners.

Linda Merritt, Research Analyst, HRO, NelsonHall

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