Recruitment process outsourcing provider Advanced RPO acquired Aspirant RPO, headquartered in Pittsburgh, PA, on May 1, 2024.

Advanced RPO delivers full-cycle, project-based, custom, and high-volume RPO solutions to its clients across high-growth, mid-market, and enterprise sectors. The acquisition enriches Advanced RPO’s offering, specifically adding front-end talent acquisition capabilities such as recruitment marketing and broader talent advisory. These services ensure clients are prepared to fill current and anticipated future skills gaps resulting from retirement horizons and roles emerging from applying advanced technologies.

Aspirant RPO provides tailored recruiting solutions, including enterprise and project recruiting, talent advisory services, executive recruiting, and employer branding services; its holistic approach supports the entire talent acquisition ecosystem. The country and industry footprints of both organizations are well aligned. The acquisition will add ~80 employees to the existing ~100 Advanced RPO employees. The rebranding and integration of Aspirant RPO are scheduled for completion by Q4 2024.

The acquisition expands Advanced RPO’s service portfolio and further strengthens its market position within the chemical and manufacturing industries. NelsonHall estimates the combined RPO 2023 revenues for both organizations were $21.6m.

Aspirant RPO’s client engagement approach aligns with Advanced RPO’s high-touch, results-oriented delivery model. The complementary service offerings provided by Aspriant RPO will be valuable to client organizations as they seek to enrich their employee value propositions, revitalize employer branding campaigns, and refresh recruitment marketing strategies to attract candidates with the right talent and skills.

NelsonHall views this acquisition as a service expansion supporting Advanced RPO’s end-to-end growth journey. We anticipate synergies between the client portfolios will enable cross-selling opportunities and front-end talent acquisition advisory options for existing clients. Moving forward, Advanced RPO will be able to provide recruitment marketing, EVP, and HR advisory services, enabling internal client resources to focus on strategic initiatives that deliver longer-term value.

Aspirant RPO is Advanced RPO’s first acquisition. Yet, the company states that it has both organic and inorganic growth strategies, indicating that it may look to further acquisitions in the future.  

Several other RPO vendors have made similar acquisitions to extend their capabilities, including:

• Kelly Services acquired Motion Recruitment Partners, LLC (MRP) in May 2024
• Hudson RPO acquired Executive Solutions, a Dubai-based talent solutions company, in March 2024 and Hudson Global Resources, a Singapore-based RPO provider, in November 2023
• Job Mobz acquired Golden Hive RPO, a Sacramento, CA-based RPO provider, in December 2023.

Service delivery transformation is ongoing as RPO vendors examine all aspects of their operating models and offerings, and buyers focus on modular services to support prioritized hiring campaigns and staff augmentation. Organizations will leverage broader and strategic services for infrastructure modernization and recruiting process optimization. Additionally, consulting will remain in demand as organizations seek DEI, SWP, change leadership, and technology consulting services to support near-term and longer-term transformational and workforce planning strategies.  

To support the rebound in hiring volumes anticipated in H2 2024 and the need for broader HR and technology expertise, NelsonHall expects more acquisitions in the RPO market in the year ahead.

ADP recently held its 2023 Analyst Day (#ADPaday) event at its Chelsea Lab Innovation Center in New York City, where ADP leaders and clients shared strategies, product roadmaps, transformational impacts, and industry insights related to the human capital industry.

As the company nears its 75th anniversary in 2024, ADP President & CEO Maria Black shared the company's three strategic pillars to grow stronger, smarter, and with purpose:

• Greater focus on leading with best-in-class HCM technology through the innovative application of GenAI, ML, and AI
• Continuing to provide unmatched expertise and outsourcing supported by its 60k staff members
• Leveraging the organization's global scale to benefit clients.

Execution of the ADP growth strategies, particularly the integration of GenAI, is evident across its product roadmaps as the company pilots and refines its advanced solutions internally and within limited client engagements.

NextGen HCM

The company's NextGen HCM gives users access to intelligent tools, providing real-time support and insights in the flow of work. Demonstrating the results of its recent product enhancements were four ADP clients representing various industries, diverse organizational needs, and different desired outcomes. For example, the Total Rewards Director for agribusiness Scoular shared how the NextGen HCM platform enabled their business to minimize auditing time following its annual open enrollment period from three weeks to a few hours. Also, the Vice President of Human Resources from fashion retailer Steve Madden explained how the company achieved its strategic sustainability goals of reducing its carbon footprint and paperless environment by deploying ADP NextGen HCM.

ADP Assist

ADP's introduction of its GenAI-enabled intelligent assistant, ADP Assist, illustrates the company's commitment to making HCM 'more human'. With ~85% of HR work transactional, ADP product engineers imagine future HR products with role-based co-pilots (assistants) that pop up in the flow of work, supporting role leaders. ADP Assist allows users to ask the system questions, issue custom commands, generate reports, and compose and personalize emails to an employee or specific group. For example, ADP Assist can create and send tailored emails about upcoming tax legislation on retirement accounts that may impact particular employees or nudge a hiring manager about completing required tasks, such as ordering IT equipment before a new employee onboards.

ADP's analytics support critical conversations with employees by offering instant manager feedback. The application of AI and ML provides intelligent insights to managers throughout the employee lifecycle, such as identifying employees at risk of separation, new employee onboarding tasks, internal mobility opportunities, and performance reviews. Taking these insights further, ADP Assist nudges leaders to initiate discussions to understand what may be causing these trends and take empathetic steps to provide support.

ADP API Central

In June 2023, ADP acquired low-code intelligent workflow automation and data integration provider SORA. The technology supports ADP API Central, targeting the SMB market and enabling an organization to quickly create an API marketplace using pre-built APIs based on specific functional use cases.

API Central allows organizations to define and implement required changes quickly, removing roadblocks to increase agility and speed. Beyond analyzing traditional HR data, ADP also considers employee work and family data when developing an API. For example, a recently developed scheduling API scans an employee's work schedule and family data to avoid personal conflicts, such as a child's birthday. The API can intelligently schedule work with another employee, preventing a personal clash and sending a birthday cake to the employee's residence via DoorDash.

Importance of AI Transparency

As ADP continues innovating and delivering real-time HR insights through GenAI and other intelligent technologies, the company understands the importance of transparency around data security, privacy, and broader ethical considerations, such as worker displacement. To remain engaged and apprised of emerging trends and concerns, ADP sustains an active AI & Data Ethics Committee comprising industry leaders, clients, and ADP experts. ADP's continued industry leadership and supplemental tools provide a robust AI safety umbrella, supporting client understanding and acceptance as these transformational solutions gain mainstream adoption. 

ADP remains focused on the human experience, the power of data analytics, and transactional efficiency. While clients continue to inquire about process automation and the appropriate application of AI across HR, ADP’s product engineers remain focused on the company’s product philosophy and reimagining the future of HCM by making it easy, smart, and human. 

The week of March 13, the 2023 ADP Meeting of the Minds (MOTM) Conference saw more than 3,000 participants descend upon downtown Atlanta. ADP leaders, guest speakers, and clients shared data and insights on industry trends, economic forecasts, and the overall health and direction of the human capital industry.

At a high level, six economic trends are reshaping the global labor market, including slowing growth, persistent inflation, rising wages and costs, a smaller global workforce, a digital economy, and evolving workforce trends. At a more detailed level, a primary theme of this year's conference was HR analytics. Observations included:

• Data science continues developing and presenting practical business use cases and solutions supporting all phases of the employee lifecycle, from recruitment and the anticipated cultural alignment of a candidate to employee skilling/reskilling and internal mobility opportunities
• ADP clients who leverage data throughout the HR lifecycle have realized a 24-day reduction in time to hire and ~30% average decrease in voluntary turnover costs
• 23% of the respondents to ADP's 'People Analytics Reimagine' webinar series stated that their organization's biggest challenge in driving value from people analytics is knowing where to focus.

The pandemic and the new world of work catalyzed technology transformation and the use of people analytics. Employees and employers alike experienced the strain of a remote working environment. In response, employees reassessed their work-life balance and personal priorities, triggering a series of HR trends and buzz phrases, including the great resignation, quiet quitting, and the sansdemic. This perfect storm of talent obstacles left organizations scrambling to attract new resources and retain existing staff.

During the conference, ADP presented various ways HR organizations can deploy analytics to combat these challenges by understanding employee needs, wants, and specific qualities. 53% of the respondents to ADP's 'People Analytics Reimagine' webinar series leverage analytics to benchmark HR metrics; however, only 38% stated that their organization uses HR analytics to improve employee engagement or manage retention risks. ADP found that those organizations using data to maximize employee retention have experienced ~30% average decrease in voluntary turnover costs.

HR analytics can identify high performers, particular roles at the most significant risk of resigning, and where pay inequities exist. Taking these insights further, leaders can initiate discussions to understand what may be causing these trends and take empathetic steps to provide support. Analytics may enable critical conversations with an employee by giving instant feedback.

For example, the ADP Virtual Assistant (AVA) delivers instant payroll processing interactions with employees. AVA provides real-time visibility into gross-to-net, benefits, and deductions data. Additionally, AVA provides intelligent self-service by anticipating, solving, and reducing employee HR cases before they happen, such as where PTO balance anomalies exist compared to historical PTO usage for an employee.

The new world of work has yielded a new breed of employees, requiring increased employer/employee communication and transparency, expanded benefits offerings, and flexible work schedules, enabling an optimal work-life balance. Data science continues evolving and providing practical business use cases for all segments of an enterprise, including HR insights supporting all phases of the employee lifecycle. To succeed, today's leaders require the confidence and understanding of people analytics and workers' priorities to enable their workforce to thrive.

Earlier this month, the 2022 HR Technology Conference saw more than 400 vendors and 5,000 participants descend upon the Las Vegas Mandalay Bay Hotel & Conference Center. Attendees presented industry trends, learned from colleagues, viewed demos of the latest technologies, and met face-to-face in what felt like a pre-2020 setting.

Several key observations from this year's conference include:

• The considerable number of start-up companies and niche players with highly targeted and specialized service offerings, such as industry- or skill-specific recruitment services
• The impressive volume of equity funding investments across the HR technology market (e.g., during the conference, global employer of record solution provider Atlas, in partnership with Sixth Street Growth, announced their $200m strategic equity investment)
• The increased organizational focus on employee retention strategies in response to the "great resignation" and, more recently, the impact associated with "quiet quitting".

The pandemic and the new world of work have been catalysts to the transformational service and technology shift experienced within the HR industry in the past 24 months. A common theme in these changes has been the expanded use of technology and analytics throughout all phases of the HR lifecycle, from candidate selection and hiring efficiency to employee retention.

Technology plays a critical and evolving role in recruiting and digital onboarding in this fast-growing market. With its Flex HR platform, Paychex onboarded ~2m hires in one year, with 80% of the new employee onboarding completed on a mobile device. NXTThing RPO and JazzHR reduced the cycle time required to hire and onboard new talent by 50%. In addition to helping its clients improve employee retention, NXTThing RPO is walking the talk with 0% turnover of its recruiters. The company attributes this accomplishment to the treatment of its employees; e.g., healthcare is 100% paid for by the employer, employees receive unlimited paid time off (PTO), a performance-based bonus plan for all employees, and a flat management structure.

After briefings with over three dozen vendors at the conference, it's clear that the application of data science and artificial intelligence to provide predictive HR insights has evolved into reality. Managed payroll provider, Paychex, conducts ongoing salary benchmarking and frequent performance review sessions to increase employee retention. Employee retention risk factors, including salary inequities and high-demand job roles, are available via a talent scorecard, enabling managers to approve pay increases outside the defined performance review cycle.

Compensation management software company, Decusoft, developed a people analytics module presenting real-time pay-equity and diversity data. The system also enables managers to run data models providing greater budget certainty and the ability to identify and resolve retention trends. From an employee perspective, Decusoft generates total compensation and rewards statements presenting a holistic view of their pay, benefits, bonuses, equity, healthcare, paid leave, and retirement contributions. These data are accessible in real-time to keep employees apprised of their compensation history.

HR data analysis and usage is expanding to provide valuable insights beyond the HR department. Predictive analytics can support the identification of high-potential employees at the highest risk of resignation and anticipated job vacancies based on multi-year retirement horizons or projected production volumes.

IBM's recruitment process outsourcing group assesses and optimizes the employee onboarding and initial learning experience to support talent retention. According to the Employ-Inc Q3 2022 quarterly report, 63% of the recruiters surveyed experienced new hires leaving in the first 90 days after starting a new job, and 52% of those respondents believe it was because they were the wrong candidate for the position. Poor initial training experiences may also lead to candidates quitting or resigning before their first job. While the new employee experience is critical to successful onboarding and engagement, companies must also focus on providing opportunities available to existing employees to manage voluntary attrition. To address this vital need, the IBM team also delivers internal mobility services by analyzing talent and skills data to evaluate employee profiles and support hiring managers to promote from within the organization.

Increased employer/employee communication and transparency, expanded benefits offerings, and flexible work schedules and locations are characteristics of the new world of work. The global talent shortage has exacerbated an already challenging hiring environment for employers. To succeed, today's leaders require a focus on employee experience throughout the enterprise, refreshed hiring policies and practices, and modern systems enabled by data to attract and retain their workforce.

On September 15, Atlas secured a strategic equity investment of up to $200m in partnership with Sixth Street Growth.

Atlas specializes in direct employer of record (EOR) solutions and enabling technology, contractor pay, consulting services, HR service delivery, and global mobility & visa offerings. The company is focused on supporting clients’ international expansion strategies in compliance with employment rules and regulations through its entities in ~165 countries. It rebranded from Elements Global Services to Atlas in June 2022, and its rebranding efforts reflect the flexibility, agility, and enabling technology required to meet client and worker UX expectations, talent needs, and data requirements intensified by recent global events.

As a result of this investment, Atlas will be able to enhance its technology platform to support localization and provide additional self-service functionality and automation features. The launch of the Atlas Human Experience Management (HXM) platform was coordinated with the organization’s rebranding efforts in June.

The funding also supports broader in-region customer support, including hiring additional native language staff to deliver in-country and in-time zone support to its clients and worksite employees. Atlas continues to hire in-country staff throughout all levels of its organization, including senior leadership. The expanded regional presence balances direct client and worksite employee support and technology.

The company maintains an aggressive inorganic growth strategy to broaden near-term service portfolio offerings, technology advances, and the addition of new in-country legal entities.

NelsonHall views this investment as a strategic enabler to support Atlas’ organic and inorganic growth strategies. It anticipates the expansion of Atlas’ portfolio through partnerships or the acquisition of companies delivering complementary services and technologies. These relationships will enable cross-selling opportunities and the development of targeted business development strategies. The company continues to expand its services and technology offerings to support all phases of the HR lifecycle, attracting prospective clients seeking a single vendor to manage comprehensive outsourcing or targeted out-tasking of its HR services.

Several other EOR vendors have secured equity funding to extend their capabilities, including:

• Omnipresent raised ~$138m over three funding rounds to support legal entity creation in ~80 markets and the development of its OmniPlatform technology stack
• Remote raised ~$496m over four funding rounds to support legal entity creation in ~65 markets and enrich its Remote technology stack, including the release of its contractor management, relocation, and API integration services and modules
• Velocity Global raised ~$500m to support multiple company acquisitions, including iWorkGlobal and Shield GEO, broaden its services portfolio, and expand its Global Work Platform functionality to support contractor payments.

The formalization of ‘work from anywhere’ policies and the continued impact of ‘the great resignation’ have contributed to a high level of global EOR market activity and client interest. To support global and service portfolio expansion, M&A transactions, and enabling technology enhancements, NelsonHall expects more strategic investment funding across the global EOR market in the year ahead.

Safeguard Global acquired Global Upside Corporation, a global expansion, technology, and services company based in San Jose, CA on January 25, 2022.

Global Upside specializes in EOR services, new entity incorporation, human resources, accounting, payroll, and tax & compliance solutions. The country footprint across both organizations is well aligned. This acquisition will add ~500 employees to the existing 1,100 Safeguard Global employees, to create a combined organization comprised of 1,600 employees. Global Upside has been rebranded as Safeguard Global.

Significant to this acquisition will be the ability for Safeguard Global to provide additional services to enrich its EOR offering, specifically adding front-end HR capabilities such as recruitment and in-country entity set-up expertise, to ensure clients are prepared for the future of work. Safeguard Global currently delivers onboarding, in-country compliance, HR technology, and centralized payroll services.

The acquisition of Global Upside positions Safeguard Global as one of the largest providers in terms of revenues in the EOR marketplace. NelsonHall estimates the combined EOR 2021 revenues for both organizations were $65m.

The acquisition of Global Upside supports the Safeguard Global ‘Work in Any Way’ workforce management vision, which considers where, when, and how people work to assure a people-centric, flexible, inclusive, and diverse organizational culture. The complementary service offerings provided by Global Upside will be valuable to organizations when they have determined that a market is suitable for a permanent in-country entity.

NelsonHall views this acquisition as a service expansion to support Safeguard Global’s end-to-end global growth journey. It anticipates synergies between the client portfolios to enable cross-selling opportunities. For example, in 2021, Safeguard Global had 72 EOR clients that opened new entities in ~100 countries. The clients leveraged their internal HR organizations to organize and complete the logistics of establishing these new entities. Moving forward, Safeguard Global will have the ability to provide these and additional direct services that will enable internal client resources to focus on strategic initiatives and core functional responsibilities.

Safeguard Global has a history of acquisitions, including GEDA in 2020, and WorkFor Group and AdminMe in 2019. The acquisition of Global Upside firmly cements the organization as a leader in the global EOR market.

Several other EOR vendors have made similar acquisitions to extend their capabilities, including:

• Velocity Global acquired iWorkGlobal in April 2021 and Shield GEO in July 2021
• TopSource Global Solutions and PEO Worldwide merged to form TopSource Worldwide in August 2021
• Deel acquired Roots, an HR software company, in January 2022.

The rapid increase in remote working combined with the impact of the ‘Great Resignation’ has contributed to a high level of Global EOR market activity and client interest. NelsonHall expects more acquisitions in the global EOR market in the year ahead to support rapid growth and capability expansions.