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ADP Stays Focused on Client-Centric Innovation

ADP recently held its seventh annual industry analyst event in NYC at its Innovation Lab in Chelsea, providing a current business update, news of recent developments, and insights on what’s to come.  

Overall, there has been growth across ADP’s cloud-based platforms, including RUN, Workforce Now, Vantage HCM, and GlobalView HCM, with the total number of clients reaching ~501k, up 16% from ~431k last year. These platforms make up the foundation of ADP’s HCM business, so further developments and enhancements to its technology are paramount to its continued success.

For the last year, the focus has been on enhancing the user experience across most of these platforms. For example, the benefits module of Vantage HCM includes a comparison shopping experience, and a new onboarding tool will be released in the next few weeks. Another significant enhancement included the launch of ADP Marketplace in late 2014, which integrates third-party applications with ADP’s technology. To date there are ~60 apps in the ecosystem, including RightFit’s RightView, which was added last week.

In the U.S., ADP has focused on the synergy between payroll, HR, and benefits, which is now expanding globally through a partnership with Thomsons Online Benefits. Global/multi-country benefits offerings essentially take one of two forms:

  • Multi-country benefits brokerage and consulting services
  • Multi-country technology platform with optional local administration.

Thomsons’ Darwin platform will be integrated with ADP’s GlobalView HCM platform, which is geared towards MNCs. Other examples of multi-country technology platforms include Mercer’s MercerGold and JLT’s BenPal.

In terms of its future direction, ADP’s new big data platform, DataCloud, will be a significant focal point, which goes beyond providing analytics and reporting to include benchmarks beyond pay. Other future developments of DataCloud include predictive analytics and data exchange, which will show how workforce metrics impact business outcomes.

The largest opportunity for ADP is leveraging its HR BPO services, and ADP appears to be on the path to capitalize on this as it focuses on connecting its technology with expertise to transform HCM. This, however, will not happen overnight and while ADP’s Strategic Advisory Services can facilitate the connection to its HR BPO services, the bandwidth of Strategic Advisory Services to support such a venture will take time to develop, especially when compared to other HR BPO providers such as Aon Hewitt, Accenture, and Xerox that have separate consulting arms.

However, the ingredients for success are all present, so it’s just a matter of assembling them – though the outcome will be different for each client depending on their outsourcing mix. For example, for Sodexo, ADP provides end-to-end HR BPO services, while Kimball International has outsourced employment verifications and COBRA administration to ADP while retaining other services in-house using the Vantage HCM platform. 

In any event, ADP is continuing on a path that is focused on client-centric innovation coupled with services.

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