Payroll Services Landscape Evolution
To satisfy customer demand (and internal revenue growth goals), payroll service providers must move beyond payroll services to offer additional solutions.
Multiple add-on revenue opportunities exist.
- eRecruiting Software
- Social Performance Management
- HRMS software technology
- FAO Services
- Staffing Services
- HCM Services including human resource services of compliance and administration as well as human capital services focused around the worker, workforce planning, and HCM KPI metrics/analytics.
The market is currently on the cusp of a major shift between legacy client-server technology and cloud or SaaS software technology. The affordability and usability of cloud solutions has increased the appetite for more software solutions connected to payroll.
Along with the technology platform, demand by consumers has shifted. HR is increasingly being asked to not only manage “employee transactions” through “System of Record HRMS solutions” but to also enable the worker through “Systems of Engagement” which utilize social, mobile, and analytics capabilities embedded in the technology software applications.
The marketplace for workforce management software and related HCM including content, software, services, and outsourcing solutions consists of thousands of firms worldwide. However, by function and by industry leaders exist.
While the payroll market for small businesses with less than 50 employees is highly competitive (“red ocean”) between several different vendor types; there are approximately 50 players with significant, meaningful revenues ($10M - $100M in annual recurring non “pass-through / non-reseller revenues) in the United States. For multinationals and global organizations there are a dozen global payroll service providers.
The middle market of small and medium organizations with 50 to 5,000 employees representing greater than a million USA businesses is wide open as no dominant nationwide leader exists. Regional and industry specific payroll and beyond service providers do exist as highlighted in the table below. Download our Payroll Mid-Market Landscape Report.
Almost every organization outsources part(s) of HR (human resources). Most businesses use 3rd parties to perform payroll, job recruiting through job boards like Monster or social media sites such as LinkedIn, background checking, assessments, and benefits administration.
An outsourced provider uses a combination of technology, certified personnel, and streamlined processes to more effectively perform a transaction for the buying organization than can be efficiently done inhouse.
For HR, HCS (Human Capital Services) and related workforce management solutions (WFM), technology has outpaced user adoption. Today, the demand from consumers to have the same technology experiences at work as they do at home, along with the changing workforce dynamics, is driving the future of HR software and human capital services (HCS).
Read more about beyond payroll HCM services:
Payroll Services Market Landscape
HCS Human Capital Services Outsourcing HRO Market Landscape ...
U.S. Payroll Outsourcing Services 2011–2015 Forecast and Analysis
Comments