A few weeks ago I stated I thought SAP would end up being the default HRMS platform for HRO/BPO vendors. Looks like they have started the ball rolling. Instead of getting into HRO administration, they are doing what they do best – market software. This is huge for them because these agreements virtually guarantee their status over Oracle in the BPO space. Certainly for HRMS, they are a logical choice over Oracle anyway. If Oracle were smart, they would offer the PeopleSoft platform, because (IMO) HRO vendors would prefer a platform with a higher embedded adoption rate. However, since Oracle has no idea what they are doing with PS in 5 years, that simply doesn’t make sense.
However, what’s really surprising about the article is that they are partnering with ACS, EDS, and ADP. ACS makes sense. So does EDS as Towers Perrin has a large SAP consulting arm. However, it seems ADP will be going away from the Enterprise HRMS platform they purchased from PeopleSoft ages ago? This also means that ADP might be thinking in-house payroll for these large BPO deals which seems to be a major flip in philosophy. I can see how ADP would prefer leveraging SAP for global payrolls, but I’m just not sure how in-house payroll fits into their model.