I saw this press release and got to thinking about ADP's direction with HRMS. Why do I keep talking about ADP and why are they important? Being the 10,000 lb. gorilla in the payroll market, they are actually also one of the huge players in the core HRMS market as well. They have more HRMS installations in the mid-large employer market than anyone other than PeopleSoft/Oracle. PeopleSoft was the most installed HRMS and ADP Enterprise came in at #2 (please note I am not including PCPW and PayForce - it's pure ADP Enterprise).
As ADP attempts to turn into more of a on-demand company (like workday, salesforce and successfactors), they are held back by technology and legacy customers.
Technology is a huge hurdle at ADP - not that they don't have it, they do and are good at it. If you don't believe me, then you should because there's a great chance they process your stock transactions. Their HR services have grown so fast in the last 6-7 years that the technology infrastructure is almost impossible to keep up with. Acquisitions in all 3 major areas (HR, PR, Benefits) have added systems, service centers, etc. This has also mean different code bases that needed integration and bringing them up to single standards.
As of this year, ADP is close. They have fantastic web services technology that lets you subscribe to a portal with on-demand basic employee self service, check-view, MSS performance reviews, MSS compensation reviews, time and attendance, benefit enrollments. All of this is fully integrated into a single portal experience so the employee or manager only logs in once (we're going to talk a lot more about web services in January). So anyway, they are gaining lots of ground on the technology side. The only problem, which may not really be a problem, is that to get their hosted-only portal, you have to host every service you subscribe to - HRMS, Time, Benefits...
Then there's the second problem. "Legacy" customers. The ones on premise (non-hosted) HRMS. As of the current version, ADP doesn't even offer self service tools anymore - they assume you will host and use their portal. We now go back to the "2nd largest provider of HRMS" story. They have at least 5-700 non-hosted clients IMO. In several years, they will have to convert to ADP hosting, or they will be out looking for a new HRMS that has native ESS/MSS. Or option number 3 - go buy something off the shelf. Until this press release I didn't know anything was out there for non-hosted ADP clients. From what I hear, it's a pretty nifty little product. Considering that ADP Enterprise has over 1000 installs currently in live production, it's nice this large user base has another option.
