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ADP Bets Big on HR Software by Adding Suite of Services

The traditional back-office service provider joins the likes of Oracle, SAP and SuccessFactors in a crowded HR management software field with the unveiling of Vantage HCM.

October 6, 2011
Related Topics: Workforce Analytics, Internet, ERP, Performance Management, Payroll, Attendance, Retention, Benefits, Technology, Talent Management, Latest News

Automatic Data Processing Inc., the company best known for its payroll services, is pushing to become a comprehensive provider of human resources software and services for large organizations.

On Oct. 3, the company unveiled a new product dubbed ADP Vantage HCM. ADP officials portray the launch as a "big bet" designed to move the company from its traditional back-office role to center stage in the hotly contested human capital management market.

"With the launch of ADP Vantage HCM, ADP is mobilizing its resources to help clients who want to simplify and consolidate HR technologies and services across their enterprise to achieve a lower cost, more compliant, and more effective HR function," the company said in a written statement.

The product of an 18-month research and development effort, Vantage is designed to be an integrated set of applications and services covering HR administration, payroll, benefits, talent management, and time and attendance. Among the benefits of the package, ADP says, is lower cost through a blend of outsourced administrative services and cloud technologies, which refer to computing resources accessed over the Internet.

ADP also says Vantage will help big companies improve employee satisfaction and retention through easy access to HR data and processes, as well as give clients powerful workforce analytics to guide business decisions.

ADP is entering a crowded marketplace. HR software sales are projected to grow strongly in the coming years, as companies try to manage their people and software systems more effectively. A variety of vendors already are pitching wares to big, global organizations.

Oracle and SAP are the giants of the field. Other players include Infor, Kronos Inc. and Ultimate Software Group Inc. Another set of vendors includes Saba Software Inc., SuccessFactors Inc., SumTotal Systems Inc. and Taleo Corp.—all of which started in talent management niches such as performance management, recruiting or learning management but have broadened their offerings in recent years to provide a wider set of tools to customers.

Some analysts say a major trend in the HR software market is customer desire for a more integrated, consolidated approach to people management matters. Other changes under way are the rise of applications in the cloud—which promise lower upfront costs and fewer technology headaches—as well as the emergence of software designed to run on smartphones and tablet computers such as the iPad.

ADP's new Vantage product attempts to tap each of these trends. For example, ADP says employees and managers can access information via multiple devices—smartphones, tablets, laptops or PCs.

Although ADP says companies will welcome the idea of bringing all of their HR processes under the roof of one vendor, not everyone is so sure.

Bobby Yazdani, CEO of Saba, argues companies are more focused on strategic human capital management issues such as learning, and wise firms will handle those matters without regard to how they cut their paychecks.

"Anything that's attached to payroll and benefits is nonstrategic," Yazdani says. "That's not the problem."

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