With 2013 upon us and a host of new legislation affecting payroll already beginning or set to start soon, we wanted to take a minute to provide you with the latest changes that will be impacting your payroll runs. From Medicare to supplemental wages to income taxes, this infographic explains them all and even provides a hint of what's just on the horizon. More...
Predicting the Payroll Technology State of Affairs for 2013
As we start a new year here at Payrolllab.com, it seems only right that we should take some time to look ahead and see what we think this year might bring in terms of changes to the payroll technology landscape. 2012 was an interesting year as far as developments go; with multiple M&A deals happening in both the payroll and broader HCM market. And from the vantage point we have in talking with both vendors and business leaders, it's relatively clear that 2013 is setting up to be just as big. Granted, within the payroll software space we've likely seen the end of major deals, but that doesn't mean that this year will be devoid of all vendor activity. After all, just last month we detailed plans that are in the works for both CloudPay and ZenPayroll; two burgeoning SaaS payroll companies that have succeeded in securing some significant funding to further develop their product lines in the cloud. Aside from the excitement these announcements have caused for business leaders perusing payroll industry solutions, the fact of the matter is that cloud payroll options are a hot commodity right now. As such, it's not beyond the realm of possibility to see one or both of these companies acquired by one of the larger players to build out the parent company's Software-as-a-Service offering. Still, business movement towards finding the right cloud payroll partner isn't the only trend likely to bear fruit in 2013. Here's our list of what we think will also be taking place this year. More...
We have written rather extensively over the past several months about the potential and pitfalls that cloud payroll holds, but recent developments indicate that 2013 may well be the year that this method of deployment comes fully into view. With nearly all vendors within the Payroll and HCM landscape eyeing the economies of scale that can be harnessed using these latest technologies, it’s only a matter of time until payroll is completely conducted in the cloud. For instance, Ceridian’s Dayforce is making major waves with their novel combination of payroll and time/attendance into a single, multi-tenant cloud solution. Likewise, this past July, SAP and SuccessFactors rather quietly started beta testing their cloud payroll solution for a rather expansive set of initial geographies. Still, the cloud payroll market remains incredibly fragmented and majority market share is far from a given for any one provider.
This concerted effort on the part of vendors to enter into the Software-as-a-Service (SaaS) payroll realm has created an interesting dynamic; whereby older, stalwart solutions such as ADP and Oracle are being forced to compete more heavily than ever before. And as is often the case within the business technology world when competition heats up, smaller companies are starting to make some undeniably compelling pitches to would-be customers and businesses seeking more payroll bang-for-their-buck. In fact, just recently two of these smaller vendors (CloudPay and ZenPayroll) have made funding announcements that indicate their respective solutions are setting the stage to be forces to be reckoned with in the coming payroll evolution. More...
Payroll Implementation Consultants: A Best Practices Selection Guide
Over the past several months we’ve written quite extensively on the subject of payroll software consultants; from tackling the topics of productivity, to looking at how to on-board, to even discussing the principles of managing the payroll consultant-organization relationship. What we haven’t really used this venue for yet though is to discuss the best practices that need to be followed when selecting a payroll consultant for system implementation. Sure, we’ve been able to provide a “quick-start” guide for a high-level look at selection through the lens of price, references, and consultant attributes, but what are the best practices that industry experts and other companies ascribe to when looking at this unique relationship? Are there pitfalls to look out for? What about tactics that companies should employ? Here we take a look at those questions and more—answering them with commentary we’ve gotten from some of the top minds in the business. More...
Global Payroll Solutions: Unifying Your Payroll For Multiple Benefits
Although we’ve had a chance to delve into the topic of multi-country payroll solutions before, what we haven’t had a chance to do yet is provide a primer for those companies who are just now beginning to look into capitalizing on this trend. After all, as modern payroll technologies play their part in helping to create the proverbial “borderless” business environment, an increasing number of organizations are starting to look at moving into new territories. Indeed, as provider Northgate Arinso points out, “As companies expand internationally, they are challenged to find new and reliable ways to administer and pay their workforce in each country where they conduct business”. However, companies’ approaches to payroll tend to be all over the map (all pun intended); and advice on how best to complete this task is fragmented at best. So, here at Payrolllab.com, we decided to put together a primer for those businesses—broken down into two parts. This first installment covers the basics of the benefits of unifying payroll onto a global platform; with the second installment giving a cursory review of the challenges that are likely to be faced.
The Business Case for Unified Global Payroll
Whether a global conglomerate or a smaller multinational with employees in just a handful of different countries, the strategy is usually a case of addressing each set of national payroll issues on an individual basis. This logical but uncoordinated line of attack leads to a fragmented scenario, with various service providers and software vendors; service quality that varies from country to country; and a decentralized set up that does not lend itself to easy production of global payroll reporting. This last point means that top leadership can find it difficult to extract enough relevant data, or make meaningful comparisons between countries to start improving overall efficiencies.
The alternative is a strategy that takes payroll as a global function. Specialists Webster Buchanan Research point out in their paper, Multi-country Payroll: Analyzing the Business Benefits and Challenges, that it can be difficult to look past the local laws and collective bargaining agreements that create national level payroll environments but that, “in reality, while every legislative environment is different, 70% or more of the processes performed in a payroll operation are common regardless of where they take place. Payroll data is prepared and submitted, gross-to-net calculations are carried out, payments are made and the associated reports are completed”. The research firm then goes on to define multi-country payroll (also referred to as ‘global payroll’) as, “a discipline that takes advantage of these commonalities, enabling companies to centralize and standardize the core activities that underpin every payroll set-up, and then deal with local regulatory requirements and business rules on a country-by-country basis”. This approach enables multinational organizations to apply best practices across their workforce (regardless of geographical location), reduce vendor numbers, mitigate operational and compliance risks, improve information access, leverage economies of scale, and potentially cut costs. The following list of business benefits forms the basis of a business case for a global payroll strategy. More...
Implementing Self-Service Payroll Features Requires Specific Tactics
Employee and Manager Self-Service functionalities are fairly well-established capabilities that the bulk of payroll and HR systems utilize; of which the benefits of reduced costs, better use of payroll resources, empowered employees, improved data quality, and others are well-known. In fact, even SHRM (The Society of Human Resource Management) pointed out in 2011 that “well-designed self-service allows employees to make informed choices and to become self-reliant”. Even so, if your organization is new to this type of process, or added self-service functionalities are a key part of a new payroll application’s feature set, then successful implementation is anything but a given. As such, it’s important to remember that there are pitfalls to avoid and practices to adhere to in order to make the implementation and adoption of those self-service payroll capabilities successful. Here’s our 3-step plan to making that happen.
Regardless of the kind of relationship you’re talking about (be at a significant other or an employee), listening is probably one of the best change management tactics you can employ across a broad spectrum of scenarios. And so, when we started putting together our list of the top implementation strategies for payroll self-service, listening topped our list time and again. Specifically, by listening to employees (including managers) about what their self-service payroll needs are through avenues such as surveys, briefings, and focus groups, you’re able to have a much better gauge how that self-service functionality will be received. Here’s why: not only does consultation with end users create early engagement and enthusiasm for the project, it can also provide valuable information on which features will be more easily accepted, and which will not. For instance, in surveys that the American Payroll Association (APA) and HR Outsourcing Association (HROA) conducted in 2011, employees were asked about online payroll portals and support options. In the APA study, 25.5% said they wanted their companies to offer a self-service online pay statement portal. And in the HROA report, less than 25% of employees surveyed indicated they would utilize a “chat” option for pay or benefit questions. How would a company know that they might inadvertently be alienating a quarter of their workforce if they don’t ask these questions and listen to the answers? More...
SurePayroll’s Small Business Payroll Solution: An Independent Review
A wholly-owned subsidiary of Paychex (since 2011), SurePayroll has been in business since 2000, and has racked up a fairly hefty set of service awards in that time; including: 2012 Contact Center of the Year, 2011 National Sales Team of the Year, Customer Service Department of the Year, Best eCommerce Customer Service Team of the Year, Finalist for Best Customer Service Organization/Department (and Best New Product), along with countless others for their products, innovation, and overall business.
SurePayroll’s Payroll Options
Falling into the category of an outsourced, web-based service, SurePayroll is one of the single-most lauded options that small business owners can leverage; in large part thanks to the system’s intuitive navigation, logical menu structure, and ancillary integrated HR processes. And although businesses still have to enter (or import) and preview employee hours for this exception-based application, once completed SurePayroll handles the rest of the processes as the main part of their service; including providing support for federal, state, and local mandatory governmental requirements. Presuming five employees paid bi-weekly, TechMediaNetwork puts the SurePayroll price at $80.40 per month. As CPA Practice Advisor found though, SurePayroll’s base fee is actually $30.95 plus and additional $1.85 per employee. And assuming that SurePayroll’s W-2 processing capabilities are leveraged, an ancillary fee of $40 per company plus $4.25 per employee will be levied. More...
Intuit's Payroll Review Leads Payrolllab’s Small Business Hub
As part of ongoing efforts to improve our research and deliver the most value to readers, Payrolllab.com is excited to announce a new channel hub that will be specifically devoted to small business payroll software solutions. In large part this new initiative is driven by the fact that, unfortunately for small businesses, dedicating limited resources and retaining in-house expertise for payroll software selection can be cost-prohibitive. Yet the goal of finding the right payroll solution is also one of paramount importance. Not only is this the case because of financial and regulatory implications, but also in terms of the countless hours and effort the right system will save. This new hub has been designed to help small businesses reach that goal, and features Payrolllab.com’s trusted and independent reviews—starting off with Intuit.
Intuit’s Small Business Payroll Solutions: An Independent Payrolllab.com Review
Thanks to accounting and tax software packages such as QuickBooks, Intuit is one of the most well-recognized players in the small business technology space. And although Ceridian, Paychex, and SurePayroll tend to take up the bulk of marketing fodder, Intuit can lay claim to a sizeable portion of the small business market share with over 1M customers. Indeed, Intuit has been a major player in the small business software market for some time now, but after the 2009 acquisition of one of their biggest (and most lauded) rivals (PayCycle), Intuit now has the brand strength and underlying technology to be able to offer the full range of payroll applications and services. And while there aren’t particularly standout aspects of the Intuit solution compared with the other vendors in the space, Intuit can provide a payroll solution to fit nearly any scenario that a small business might have. More...
Benefits Administration, Payroll, and Compliance Tops at HR Tech Conference
We’re here at the HR Technology Conference this week, talking with a host of industry thought leaders, companies, and executives; and we have to say that, for a conference dedicated to Human Resources, we’re seeing quite a few vendors (and vendor announcements) that are in the business of what our focus is on here (i.e. Payroll, Benefits, Outsourcing, Self-Service, Time/Attendance, etc.). As such, we thought we’d use our time this week to brief you on just some of the 53 total exhibitor and industry announcements being made here at #HRTechConf that apply to what you do. For instance, Ceridian finally announced the highly-anticipated addition of Dayforce payroll functionality for Canada; Accu-Time Systems introduced a new family of workforce management terminals; and Equifax Workforce Solutions introduced an enhanced version of its onboarding solution (with what they’re calling iW4 or Interactive W-4). For our purposes here though, we’ll be focusing on covering the updates from bSwift, EmployTouch, and LawLogix.More...
Business Process Outsourcing: A Closer Look at Comprehensive BPO
We’ve talked rather extensively as of late about outsourcing benefits administration, payroll, and even 401Ks. But the fact of the matter is that countless organizations are turning away from this singular view of outsourcing and adopting a broader view of how multiple processes can be handled by a third party. This view, known as Comprehensive Business Process Outsourcing (BPO) can cover the full spectrum of HR processes (i.e. recruitment, learning, personnel administration, etc.) but is most often used to handle the more transactional-based elements of payroll and benefits—areas that, when combined, can lead to “a minimum threshold of 10% to 15% cost reduction… [with] 20% or more [being] typically average” according to Gartner research. And this exponential difference in efficiency gains is the main driver for why so many companies are considering this route. Even so, certain questions still loom large, and that’s why we’ve dedicated this article to covering just a few of them. More...
Payroll in the Cloud: A Guide to Choosing the Best SaaS Payroll Vendor
A March 2012 press release from research analysts Gartner observed that, “After more than a decade of use, adoption of SaaS continues to grow and evolve”. The report goes on to highlight that it’s the “increasing familiarity with the SaaS model, continued oversight on IT budgets, the growth of platform as a service (PaaS) developer communities, and interest in cloud computing [that] are now driving adoption forward”. It would seem then, that any hopes of cloud-hosted business software going away (or adoption even slowing down) have all but been dashed. And as it pertains to payroll technologies, more and more organizations are opting to migrate away from traditional on-premises solutions in order to gain the benefits of SaaS instead. Heck, you might even be one of them! Be that as it may, organizations should keep in mind that, as it is with any change of technology solution and/or vendor, a number of cloud payroll challenges and questions come into play when selecting the option that’s best-suited to your business’s unique needs. More...
Benefits Administration Outsourcing: Finding the Right Provider Fit
In the 2011-12 survey, New Horizons - No Boundaries, Towers Watson found that 21% of respondents have outsourced HR functions previously conducted in-house within the last 18 months, and 17% will be outsourcing further functions during the next two years. Given the current rise in benefits administration outsourcing (BAO), as well as the ever-increasing complexity of ongoing health care reforms, it’s no surprise that much of these reported increases are going towards more business for benefits providers.
And while the arguments for BAO are compelling, in truth the advantages of outsourcing benefits administration aren’t all that dissimilar from those of any outsourced HR function. Namely, with BAO, in-house HR staff can refocus on high-value, strategic activities; employees can have access to information via integrated and convenient technology tools; providers can interact more effectively with participants to ensure optimal service delivery; and the total cost of ownership (TCO) of administering programs can be significantly reduced. More...
Open Source Payroll: Why Aren’t There More Choices?
As far back as 2009, an Accenture report (Accelerating the Benefits of Open Source Software), suggested that, “Thanks to the maturation of OSS [open source software], historical concerns over enterprise use have largely become non-issues. …previous risks, such as availability of support and the potential for patent violations, have now been addressed and become positive drivers for adopting OSS over proprietary software”. My question though, is that if this was the case three years ago (i.e. that the industry’s concerns have been answered and open source use was poised for a breakthrough to the mainstream) why then are there so comparatively few open source payroll solutions? After all, is payroll really all that different from HR applications…or CRM technology…or ERP software? More...
Changing Payroll Software Providers: 4 Drivers That Mean It’s Time
Historically speaking, organizations have often shied away from wholesale change when it comes to replacing payroll software. Whatever the shortcomings of the current solution may be, the “rip and replace” option has tended to be deployed only when all else has failed; in large part due to the perceived difficulty of a fresh implementation. And while many analysts and pundits have written about this topic extensively, a 2012 case study from Mint Jutras (addressing this issue from an ERP system perspective) provides the most cogent analysis of what this reticence to change is truly about. Specifically, Mint Juras’s report highlights that “Rip and replace was avoided at all cost, even when there was no possible way the existing solution or its underlying architecture could keep pace with new market drivers an changing business needs”. Not only that though, Mint also concluded that “Upgrades were viewed as difficult and painful but a reimplementation was often seen as pure evil”. Strong words indeed, but no less true. More...
A New Multi-country Payroll Model May Be On the Rise
Choosing a provider to handle your multi-country payroll needs is a little bit like choosing a new car. Your decision has to take into account the car’s color, snazzy new dashboard features, how fast it will go, etc. Sooner or later though, the savvy buyer knows that a look under the hood at what’s driving the vehicle’s performance is in order. And so it also goes with choosing which vendor will be driving your company’s multi-country payroll. On the one hand, selecting a payroll provider (that can cross country and territory boundaries) means finding a partner who can effectively handle different languages, currencies, cultures, and legislative compliance. However, according to global research and consulting company Webster Buchanan, at least 70% of those payroll processes are common regardless of where they are performed. So the question then is how do you differentiate between vendors in that remaining 30%? More...
Leveraging Mobile Payroll and Benefits: The Battle for Access
When it comes to the latest trends in mobile payroll and benefits administration, it would appear as though the hype rather than the truth continues. For instance, just recently an article in Employee Benefit News (Mobile Tech Presents Big Opportunity for HR) Doug Ring, chief technology officer with Peoplefluent, is quoted as saying “The explosion of mobile technology presents an enormous opportunity for HR… Take these tools, get them into the hands of people doing the work and take what has traditionally been seen as the drudgery around HR and turn it into an engaging, enlightening and, dare I say, fun experience”. Certainly the opportunity is there; and on face value, it would appear that organizations are falling over themselves to be mobile adopters in all walks of business life. In fact, mobile-centric applications and interfaces were featured at the #2 spot in Gartner’s Top Ten Strategic Technology Trends for 2012. Likewise, in the Hype Cycle for Emerging Technologies this year, Gartner’s Jackie Fenn summarized that, “Themes from this year… include ongoing interest and activity in social media, cloud computing and mobile…technologies [which] continue to be part of most of our client’s short- and long-range plans”. As for payroll and benefits though, CedarCrestone’s 2011-12 HR Systems Survey took the hype up even higher—identifying it as one of the two most widely adopted mobile applications (the other being recruitment) and predicting a 50% adoption boost during 2012. More...
Benefits Management: A Primer on Health Care Reform
The 2010 Patient Protection and Affordable Care Act, referred to as the PPACA (which was closely followed by the amending Health Care & Education Reconciliation Act), may well be the most controversial legislation of recent years. Marking the biggest change to healthcare since the introduction of Medicare and Medicaid in 1965, the broad intent (at least at its simplest level) is to widen access to health benefits. While we can’t eschew all of the political implications that are obviously part and parcel with this latest health care reform, in summary the legislation aims to incentivize/encourage employer offerings of health benefits plans; overhaul healthcare provisions and costs in the U.S.; and reach into the realms of private and public health insurance services. That said, the provision subject to the most debate mandates that each individual (with some exceptions, mostly based on means/income) must maintain a minimum level of health coverage or pay a penalty. Yet, upon its passage into law, the PPACA was challenged as unconstitutional by no fewer than 28 states who filed individual and/or joint actions looking to overturn parts of the Act. While these acts certainly proved that deep issues with the new law existed at the state level (thereby calling into question the legislation’s tenure ability), it wasn’t until recent judicial action that some semblance of what these means for businesses moving forward could be ascertained. More...
401(k) Plans Outsourcing: How to Know If It’s Right For You
With a name that comes straight out of Internal Revenue Code, 401(k) plans are becoming an increasingly common, and incredibly complex, way of enabling employees to plan for their retirement. Though these plans have been around for some time, 401(k)s have recently come back into the spotlight thanks to the ever-growing number of companies looking to leverage this tool via outsourcing. It seems as though the level of financial and investment expertise that is required to manage these plans has prompted the outsourced option to become increasingly popular with employers who aren’t looking to deal with the expense (and trouble for that matter) of working to develop and retain in-house expertise. Yet countless numbers of companies have remained on the sidelines for years when it comes to their 401(k) plan and benefits administration—content to forever be debating the merits of outsourced versus in-house administration. Well, all that appears to be changing now though due to recent changes in the Employee Retirement Income Security Act 1974 (ERISA)—or more specifically the “prudent expert rule”; which mandates that retirement plans (401k or otherwise) must be outsourced to experts if the needed expertise can’t be found in-house. More...
The Week of Announcements in the Payroll Software Industry
Whether or not you tuned into this past month’s HCM Month End Review (and got to see our esteemed head of Vantive Media Chuck Schaeffer talking about everything that happened in the month of June); or you were able to check out this blog (to read up on the SHRM conference or the latest product enhancements from SuccessFactors); you’ve probably noticed that we’re doing our best to keep tabs on the Payroll and HR software industry for you. We’re constantly reading up on new products, M&A activity, conferences, and more to get you the information you never knew you needed until now.
This week’s post is no different save for one small exception: whereas other posts have focused on a specific event or happening within our little corner of the technology world—this week had so many product announcements that we decided to dedicate this blog post to all of the Public Relations fodder that companies have been broadcasting. Of course all of these little proclamations are entirely self-serving for the vendors, so we’ll do our best to highlight the good, bad, and ugly of each of these. After all, we hold no allegiances except to you our loyal readers. So, here it is…the three announcements that came out in the past 3 days. More...
SuccessFactors’ User Conference Provides Updates to Payroll and More
A little late to the party (but here nonetheless), here is our recap of SuccessConnect, SuccessFactors' annual user and partner conference—a significant event especially considering the global payroll transition announcements issued at the event (discussed further in depth shortly). Held over three weeks this past month the party officially started in Australia May 22-24 and ended in London June 12-14. That said, the bulk of the festivities and announcements came June 5-7 in San Francisco, CA where users, partners, and executives from SuccessFactors and SAP alike gathered to hear product highlights and announcements that were only hinted at or echoed during the other two dates.
Bringing together 2K attendees that represented well over one hundred countries, SuccessConnect was the first real chance for SuccessFactors to highlight their autonomy and current operational status under the new SAP ownership paradigm. While this may seem like an unnecessary undertaking, the fact of the matter is that current SuccessFactors’ customers have had unanswered long-term viability questions in their minds ever since the German juggernaut acquired the cloud leader this past year—questions that were no doubt laid to rest at the event. That said, the SuccessFactors purchase was also the big news and focus of the just-held SAP SAPPHIRE NOW conference; making many of the announcements for those people attending both events seem redundant. However, for those SAP and SuccessFactors customers seeing thing for the first time at SuccessConnect, a great deal of the news was novel, exciting, and in many ways necessary to keep the momentum going that SuccessFactors had been gaining leading up to the SAP acquisition. Here are what we consider to be the standout elements and takeaway messages.
SAP and SuccessFactors Finally Connect at SuccessConnect
Aside from the notable presentations held at the conference (e.g. Hilton, keynotes from both Lars Dalgaard and Dmitri Krakovsky, and adventurer Ben Saunders), the bulk of SuccessConnect's announcements (and quite frankly interest) revolved around the dual-company’s product roadmap. Specifically, attendees got to see the fruits of providing SuccessFactors’ VP of Product Development (Krakovsky) with an over seventy-five percent increase in R&D and room to try out and test the new innovations that the company will be using going forward. Mostly the enhancements that Dmitri’s team came up with focused on HCM capabilities and user experience; and included a “coming soon” HTML5 user interface (in the same vein as SAP’s latest upgrade); brand new social and mobile functionalities; and an innovative recruitment feature set that divides the function into Recruiting Marketing for candidate sourcing and CRM functions and Recruiting Management for expanded applicant tracking processes. More...
Benefits Admin Rules the Day at SHRM Annual Conference & Expo
Yesterday (June 27, 2012) concluded the four-day Society for Human Resource Management (SHRM) Annual Conference & Exposition in Atlanta, GA. With 15,000+ attendees (up from just 7,000 a few years ago) the event was easily the largest gathering of HR professionals in the world and featured some impressive keynotes from Condoleezza Rice, Jim Collins, Malcolm Gladwell, and Tom Brokaw. Given the high-profile nature of the event, it was somewhat surprising that more announcements about newer Payroll and HR software offerings weren’t broadcast. In fact, only a handful of vendors even paraded out anything new for the public to engage with. Here are of the few standouts that caught our eye.
SHRM’s HR Software Announcements
Epicor announced its latest version of its flagship solution, Epicor HCM version 5.7—expanding its global framework and adding the capability to configure location-specific data fields. Though hardly a drastic feature set addition, this new framework does usher in a new era for Epicor, and allows the company to compete better on a global scale by giving users the ability to translate field labels, field content, and reports in English, French-Canadian and Spanish.
Halogen Software announced enhancements to their flagship in the form of Halogen Feedback Central. New functionality offers the ability to crowd-source feedback—making assessments possible for multiple talent processes through multiple streams. While not drastically removed from more advanced 360-degree evaluations, Feedback Central does provide Halogen customers with cutting-edge feedback capabilities—a feature set that was decidedly lacking before.
SilkRoad Technology continued their domination of user-experience focused talent management applications, by announcing the general availability of their social solution Point. This latest addition to the Silk Road arsenal is one of only a handful of applications to close the gap between social networking and talent management—increasing collaboration and connections for sharing links, files, questions, photos, polls, announcements, learning and feedback across the organization.
Benefits and Wellness Administration: The SHRM 2012 Conference's Secret Theme
The above messages aside, there was a specific theme (whether intended or not) of employee benefits administration and wellness programs bubbling just below the surface. Indeed, while only 26 concurrent sessions were dedicated to benefits and wellness (compared with 36, 46, and 50 respectively for Business Strategy, Compliance, and Talent Management) the conference’s main announcements and research were focused on this area (and subsequently managed to breathe some new life into this subject through several standout elements). More...
While most of the Payroll and HR software industry has been focusing on cloud deployments and integrated talent management suites, mega-vendor ADP (Automatic Data Processing) has been quietly and strategically building up its BPO (Business Process Outsourcing) bench strength. That’s not to say that the company has neglected its broader human capital management offerings (after all the innovation-heavy Vantage suite has certainly been turning more than a few heads), but the efforts that ADP has focused on lately proves that this vendor is bent on worldwide domination in the BPO market.
Take for example, the company’s last few acquisitions; like Workscape (benefits and talent management provider); PhyLogic Healthcare (medical billing outsourcing); Asparity Solutions (employee benefits decision support vendor); SHPS Human Resources Solutions (benefits administration outsourcing expert); and RightThing RPO (recruitment process outsourcing)—each of these purchases signifies a doubling-down for the software giant in the outsourcing arena. Of course ADP is no stranger to acquisitions, and in fact growth at least within the last few years has been largely driven by gradual purchases such as these (roughly accounting for approximately $776M in spending during 2011). However, it’s one of ADP’s latest under-the-radar purchases that is most intriguing—Randstad’s Ma Foi Consulting Solutions (a Payroll business that focuses on outsourced payroll services and social benefits administration to clients across India).
For those in the know, this is not ADP’s first dance with Ma Foi. In actuality, the two have been partnering since 2009 for the marketing and operation of ADP’s Streamline offering. So why is this news so important? Well, aside from the fully customized (and localized) payroll engine that ADP gets from the acquisition, the company also garners a platform that currently serves 350+ brand-name multinational and domestic clients. But more than that, this acquisition essentially buys ADP credibility with Ma Foi’s existing client base—a key catalyst for creating a bigger footprint within the region. More...
When trying to keep pace with both SAP and Oracle HCM and payroll solutions, it can sometimes feel more like the two are engaged in a more of a political battle than a software competition. In fact, beyond the political rhetoric, there are a number of striking similarities. Two major competing parties which aren't vastly different from each other? Check. Said two parties taking up all the air in the room even though other alternatives exist (and, yes the irony isn't lost on us that with this blog post we're contributing to the banter)? Check. The two parties are in a constant battle to 'one up' the other in the public's eye? Check.
Oracle and SAP, the two largest enterprise software vendors in the HR and payroll software market seem to be locked in a perpetual state of battle which leaves each one of these companies coming out with what feels like daily press releases. Of late—a stream of releases from SAP with grandiose announcements about HANA, then in turn a stream of releases from Oracle with announcements about Fusion. Next, it was SAP with its purchase of SuccessFactors (SFSF), then it was Oracle with Taleo; all bringing us current to SAP's recent integration plans announcement for the SuccessFactors acquisition (which itself triggered a press conference response from Oracle and Taleo executive). To be sure, none of these announcements are small; in fact each one represents (at minimum) millions and often billions of dollars of invested time and resources that both companies have dedicated to driving future revenues.
And in a world where software technology innovation and the electorate's voice have together started to craft new purchasing paradigms, both Oracle and SAP should at least be lauded for their continued efforts to stay relevant and drive increased HR and payroll software value for customers. However, one can easily get the impression that the media banter is simply a veiled attempt to get the better of their opponent. So, in true PayrollLab.com fashion, let's see if we can't take these latest announcements and put them into both context and business sense. After all, voters have a right to know all the facts about politicians; and we feel customers should receive that same courtesy. Here's what we can surmise as the announcement dust begins to settle …
The Truth About SAP/SuccessFactors
SAP's acquisition of SuccessFactors (SFSF) captured the media buzz. While this acquisition was hardly an industry game changer, it nevertheless cast light on SAP's new integration strategy that will affect current and prospective customers. In a nutshell, the announcements were a broad-stroke painting of SAP's intentions to take current talent management investments (in SAP ERP HCM and Business ByDesign) and transition them to the newer SuccessFactors framework. While for the moment, SuccessFactors will remain an independent SAP company; as SAP's announcements make clear, plans are on the fast-track to make deep integration happen between these two HR software applications. If SAP had ever been lukewarm as to its HCM software solutions, it's clear that those days are behind them given the amount of time, energy, and considerable resources that are being thrown at the SuccessFactors initiative. Specifically, here's what we know:
SAP appears to be phasing out the SAP ERP HCM solution. While a commitment of support has been given until 2020, the fact is that SAP will not be delivering significant innovations for this HR software system beyond what has already been planned (e.g. mobile functionality, HANA in-memory analytics, and an improved user interface/user experience).
SAP's heavily hyped and burgeoning Career OnDemand is no more and will be essentially picked clean for any potential components not seen in other solutions.
The SuccessFactors Employee Central will become SAP's go-to cloud HCM product—a unified core HRMS and talent management software solution delivered from the cloud. Current and/or potential customers of either of these solutions (SF/SAP) however should recognize that regardless of resources, this is a lengthy endeavor—even if SAP already has a 51-country head-start on payroll.
Mobile HCM and social tools (for both SuccessFactors and SAP) are a decidedly gray area which the company references, but provides few details for. As such, prospects and customers requiring robust functionality within these areas should pay close attention over the coming months to determine whether these capabilities receive necessary planning and investment.
Business Intelligence (BI) for SAP's new solution remains an intricate and complex effort. Specifically, the company looks to integrate SuccessFactors Inform, Business Objects, and HANA to forge a new HCM analytics creation—an exceedingly difficult endeavor that involves overlapping feature sets; varying technologies; on-premise and SaaS delivery combinations; and the death of one or more solidly performing BI solutions (most notably the SAP Strategic Workforce Planning system). However, if and when this BI offering becomes available, it may in all likelihood be the single-best human capital analytics software solution in the market.
The Truth About Oracle/Taleo
Similarly, Oracle cascade of press conference highlight several key points that current and would-be customers should take note. First off, whether Mr. Larry Ellison truly cares about current Taleo customers or not, one thing is certain—he wants to keep as many of them as possible. Perhaps that's why there is far less carnage than typically happens after a large-scale software company acquisition such as this (especially for Oracle). While it was suspected that Oracle acquired Taleo for the company's recruitment software technology (and customer base), it's become clear from Oracle's recently released roadmap, that more feature sets will be used from Taleo than just recruiting. Specifically, here's what we know:
It appears as though Taleo's Recruiting, On-boarding, Performance (with added functionality from what the company calls 'unification' with Oracle Fusion), and Learning & Development applications will form the base of Oracle's cloud HCM solution.
The Taleo Compensation Management software will be killed off in favor of leveraging the considerable compensation solutions that Oracle already possesses.
Oracle has plans for on-going support for those smaller companies that are currently using Taleo Business Edition (TBE)—a base of about 4,300 customers; as well as Taleo Enterprise Edition (TEE).
While adept at managing the technical debt and numerous product lines that they have incurred to date, Oracle's agreement to support Taleo Business Edition and Taleo Enterprise Edition nets yet another code base to maintain—a problematic (albeit common) issue especially considering the smaller size of a sizeable portion of the Taleo customer base.
Oracle has given no indication as to when these changes will be taking place nor whether priority will be given to 'plugging in' Taleo as company executives called it; or simply letting Taleo operate as is/where is.
It's clear that both of these enterprise software titans are seeing the competitive threat of Workday and other emerging growth cloud HCM vendors (though SAP is the only one so far to actually admit this). While no numeric comparison is available with SAP, Oracle's Fusion HCM has only slightly more than 50 customers signed (which are mainly small to mid-sized companies) versus Workday's 280+ customers, many of which are in the 15-20K employee range (granted Workday has a considerable cloud HCM and payroll head-start on both SAP and Oracle). That said, both Oracle and SAP appear to finally be taking the strategic steps necessary to closing this gap; a verity that will likely lead to even more announcements. In fact, even now rumors are swirling that suggest Oracle's not done acquiring companies for its HCM software suite. Others say SAP will follow Oracle's lead from its Apps Unlimited days—keeping various pieces of legacy or antiquated software in perpetuity. The only thing that is for certain is that the battle between these two behemoths is far from over.
There remains one more, truly pressing, question open for discussion…if Oracle and SAP were running for office, what would their campaign songs be? For my money, I'd say that "Let's Stay Together" by Al Green would be SAP's (for their efforts to maintain their market position); "At Last" by Etta James would be Oracle's (for the fact that after 6 years in the making Oracle Fusion has finally happened); and for good measure (and equal representation for the 3rd-party candidate) "Do You Believe in Magic?" by the Lovin' Spoonful would suit Workday well.