RESEARCH NOTE TECHNOLOGY VALUE MATRIX FIRST HALF 2012 WORKFORCE MANAGEMENT. April 2012 Document M35

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1 RESEARCH NOTE TECHNOLOGY VALUE MATRIX FIRST HALF 2012 WORKFORCE MANAGEMENT April 2012 Document M35

2 THE BOTTOM LINE Organizations continue to invest in workforce management (WFM) solutions to help optimize use of their labor investment. Unlike traditional workforce management deployments that were all about time clocks and shaving pennies off payroll, today s workforce management projects are about optimizing labor productivity and reducing risk. The Technology Value Matrix evaluates WFM vendors that provide functionality in three core areas: workforce scheduling, time and attendance, and leave management. MARKET OVERVIEW Competition in the workforce management market is heating up as many companies reach end of life with their initial time and labor applications and evaluate new deployments. Although this Matrix only evaluates usability and functionality in traditional core WFM areas (scheduling, time and attendance, and leave management), many vendors in this Matrix are providing broader human capital management (HCM) capabilities. There have been a number of high-profile acquisitions since the last Matrix by Leaders (Ceridian), Core Providers (SAP with Success Factors and Oracle with Taleo), and other notincluded vendors (Salesforce.com with Rypple) that have driven increased focus on the broader Human Capital Management (HCM) space. It is important to note that vendors in this Matrix are rated in usability and functionality on their WFM capabilities; however, many (such as SumTotal) have considerable HCM offerings that will likely be included in future Matrices. Nucleus is also closely watching new organic product developments from vendors, such as Oracle Fusion HCM, which include many traditional WFM functions. Narrowing its focus in this Matrix to WFM capabilities, Nucleus finds vendors have moved their usability and functionality ratings since the last six months based on the following factors: Mobile device access and enablement as a core requirement instead of the traditional focus on time clocks or physically static terminals. The trend of consumerdriven user experience expectations for enterprise applications is growing in WFM. Innovations in integration of GPS, biometric, and other areas will likely drive more acquisition activity in the area. Labor force productivity and optimization based on analytics and edge innovations such as payment cards and fatigue management. Renewed focus on managers with back-office responsibilities, such as scheduling, who are increasingly challenged to deal with complex labor management issues. This is driving more push analytics that let managers respond to critical labor force changes based on events instead of schedule-driven reviews such as payroll review and approval. These trends are driving demand for new capabilities that follow a different cadence for workforce management decision making that is based on rapid access to information, alerts, and role-based views. They are also increasing the importance of analytics and data integration capabilities for vendors. 1

3 CERIDIAN Once again, Ceridian makes the Leaders Quadrant in the WFM Value Matrix, and is arguably the poster child for the significant changes in the work force management marketplace as it transforms itself from a traditional service bureau to a cloud HCM company. During the past six months, Ceridian has: Made a number of new executive appointments Launched LifeWorks.com, a new online portal for self-service employee assistance, work-life, and wellness services programs and content Announced and completed its acquisition of Dayforce Continued its innovation in the delivery of pay cards for payroll management. Historically, Nucleus s analysis of both Dayforce (now Ceridian) and Ceridian core customers has been positive in terms of usability. The combined intellectual property and investment of the acquisition combined with management additions bodes well for existing and potential net new Ceridian customers. KRONOS Kronos maintains its position in the Leaders Quadrant of the Value Matrix. Kronos, too, provides capabilities for time and attendance, scheduling, absence management, human resources and payroll, hiring, and labor analytics. Much of Kronos s value proposition has been focused on automating back-office processes for employers. Nucleus found Kronos Workforce Acquisition, for example, enabled employers to both reduce the time needed to fill a position, improve quality of new hires, and increase potential tax credits from the federal Work Opportunity Tax Credit program (Nucleus Research l121 Improving hiring and increasing tax credits with Kronos Workforce Acquisition, November 2011). 2

4 Kronos has also worked to expand its functionality footprint both organically in areas such as analytics and with the acquisition of SaaShr.com, a SaaS workforce management vendor for the midmarket. However, Kronos is likely to be one of the biggest victims of vendor switching, particularly as a large portion of its customer base is reaching the end of life of their existing WFM application. Today, customers have options other than an expensive upgrade (Nucleus has investigated a number of legacy Kronos deployments that have switched to other vendors in the past few months). Continued investment and focus on time-clock technology when the market is clearly moving away from hardware altogether suggests Kronos may need a real refresh to capitalize on its traditional position of dominance in the market. WORKFORCE SOFTWARE Workforce Software maintains its position in the Leaders Quadrant despite the fact that it is often competing against vendors with significantly more resources. Nucleus has found that the company s focus on customer service, ability to support complex requirements such as multiple assignments and activity-based costing, and configurable screens has made it attractive to business users (Nucleus Research m31 Assessing WorkForce Software, April 2012). Nucleus also found Workforce has identified other key point areas for functionality innovation that drive greater returns for customers, such as a built-in state and federal regulatory database in its absence compliance solution and its EmpCenter FM fatigue management capabilities (Nucleus Research m10 WorkForce Software s edge in fatigue management, April 2012). ADP ADP maintains its position as a Leader in the Value Matrix. ADP resells Kronos but also provides a range of domain expertise and human capital management capabilities. ADP has sought to extend its capabilities in the past six months in areas like benefits administration (with its acquisition of SHPS s human resources division) and mobile device access. As one of the other traditional leaders in the industry and in the business process outsourcing (BPO) market as well, ADP has also been investing in innovative areas like its new HCM solution. INFOR WORKBRAIN Infor Workbrain moved into the Leader Quadrant for the first time in this Value Matrix. This is largely because of the investments Infor has made in usability and, specifically, the first phase of its new consumer-grade interface (phase two is planned for release this summer). To note one example, the new notification bar within the application is always active so managers can be alerted on a desktop or mobile device when a critical item impacts their labor pool and quickly resolve it. SUMTOTAL SumTotal announced the acquisition of CyberShift and Accero in July 2011, adding to its feature and functionality breadth in workforce management, payroll, and benefits. On March 13, SumTotal announced the latest release of its strategic HCM platform that includes one centralized HCM portal with a streamlined user experience across time and attendance, absence management, and scheduling functionality, driving an increase in the vendor s usability score. 3

5 METHODOLOGY The Value Matrix is based on functionality and usability, the two core measures that Nucleus has found indicate an application s ability to deliver initial ROI and, ultimately, maximum value over time. Usability composite scores are based on a number of factors including intuitiveness of the application, availability of role-based interfaces, training requirements, and productivity impact on users. Functionality composite scores are based on the breadth and repeatability of functionality in the core application, the availability and ease of integration of add-on functionality that delivers additional benefit, and the vendors investment in innovative functionality outside the core that will deliver additional benefits. The Matrix is divided into four quadrants: Leaders, Experts, Facilitators, and Core Providers: Vendors in the Leaders quadrant have invested in both functionality and usability features that are likely to deliver the greatest potential returns. Vendors in the Experts quadrant have invested in deep functional capabilities that, by nature, make the application more complex and thus require more training and expertise to use than Leaders. Vendors in the Facilitators quadrant have invested in making their applications intuitive and easy to use, driving rapid adoption with limited training requirements. Vendors in the Core Providers quadrant are point solutions or those that provide limited functionality at a relatively low cost, giving them a high value proposition when limited functionality is needed. Companies can use this Matrix to assess their investment short list as well as to evaluate the case for maintaining an existing product that may lag behind the value offered by other options. Nucleus expects the center point of the Matrix, which represents the composite average point in the market, will move up and to the right over time as vendors make more investments in functionality and usability effectively increasing the average value delivered across all products. ABOUT CERIDIAN CANADA Ceridian Canada is a human resources solutions provider that helps customers optimize their workforce, reduce costs and save time by finding, paying, developing and engaging their talent. With over 40 years of experience, proven expertise and recognized service excellence, Ceridian Canada is a trusted partner to 43,000 Canadian customers. Ceridian s solutions include payroll, Dayforce Human Capital Management, HR information services, recruitment and staffing services, Employee Assistance Programs, training and more. With offices from coast to coast, Ceridian Canada provides services to more than three million Canadians. Ceridian Canada was established in 1968 and is based in Toronto, Ontario.. FOR MORE INFORMATION ABOUT OUR FULL SUITE OF HR & PAYROLL SOLUTIONS, PLEASE CONTACT CERIDIAN AT: OR VISIT Ceridian Corporation. All rights reserved

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