ADP Acquires The Marcus Buckingham Company to Expand Talent Portfolio

 

Worth to dissect the press release in our custom approach - it can be found here:
 

ROSELAND, NJ 01/17/17 -- ADP has acquired The Marcus Buckingham Company (TMBC), an innovator in human capital management (HCM), to bring to ADP clients a more scientific approach to employee engagement and performance. TMBC, and its founder Marcus Buckingham, are pioneers in using data and research to drive talent management practices that help managers build engagement and increase performance in their teams. Their unique approach empowers managers to coach employees based on their strengths and custom-design teams based on those strengths.

MyPOV – Good summary on what ADP will get with TMBC.

TMBC's cloud-based performance and talent management solution, StandOut, couples applications with coaching and education to give team leaders the tools, insights and data needed to turn talent into better employee performance. Built on decades of groundbreaking research that has uncovered the factors that differentiate high-performing teams, this solution will now be offered as ADP StandOut. TMBC has a global client roster that spans a broad range of industries from professional services to hospitality and includes many companies in the Fortune 100.

MyPOV – So it is not about consulting / services – but about IP / product assets, too as TMBC StandOut gets a paragraph here. Bringing data together with tools to help companies manage talent better is an interesting combination. The question will be if ADP can keep getting the same quality and amounts of data that an independent TMBC used to get.

"At its core, the strength and differentiation of any company lies in its talent," said Carlos Rodriguez, president and CEO, ADP. "That is why we are continuing to invest in data-driven talent management solutions with the acquisition of TMBC. The company's technology and renowned research will add to our existing talent portfolio and puts ADP in a position to better serve the growing number of innovative organizations who are thinking differently about how they manage and engage their talent. We are thrilled to welcome both TMBC's associates and Marcus into the ADP family."

MyPOV – Good quote by Rodriguez. ADP has huge upsell potential in its install base – that is mainly using HR Core and Payroll products from ADP. Now ADP has data and tool to continue the upsell as well as a chance to sell to the few hundred existing ADP Talent Management customers. Plenty of ways to monetize TMBC assets, know-how and services.

According to the Deloitte Global Human Capital Management Trends 2016 report1, 77 percent of executives say that people analytics are a priority, but only 29 percent think that they are successfully using outside data to predict workforce trends and target the right talent to meet those trends. With that in mind, the acquisition of TMBC helps ADP further deliver on its talent management strategy of helping companies build better workforces through the strategic use of data and research.

MyPOV – All about how ADP tries to position Talent Management. When you come late to the ‘party’ you better have some differentiators and ADP is using a data / research approach to Talent Management to differentiate the offering.

Marcus Buckingham is a noted author and speaker and has been featured as a thought leader on talent management and leadership trends in a range of outlets that span The Harvard Business Review and Forbes to Oprah and Larry King.

MyPOV – Indeed ADP gets a thought leader on Talent Management, it will be interesting to see how Buckingham’s ideas and concepts will be received by the ADP customer base. It’s not only ideas that are needed by ADP, ADP also needs to connect with a different buyer. But with TMBC in the pocket, doors may open more easily than ever before. Lastly an interesting culture mix, TMBC was all centered around the 'star' CEO - vs. ADP is all about the 'machine team'. Will be interesting to watch.

"In the world of people-at-work, everyone trusts ADP data, so I leapt at the chance to bring to the ADP ecosystem StandOut's data-based insights and tools on people's talents, engagement and performance," said Marcus Buckingham, co-head, the ADP Research Institute. "At a time when so many companies are clamoring for real-time and reliable people data, when they crave tools that leaders and team members actually want to use, the combination of ADP's scale, security and data-integrity with StandOut's focus on real-world teams, is unique and powerful. I'm so excited to see how many companies and people we can serve."

MyPOV – Good quote by Buckingham, we also learn about his new ‘home’ with the co-head position at the ADP Research Institute. And indeed, we know getting the ‘hard’ compensation data is always a challenge for talent management related engagement. So, this is a win / win for ADP customers.

ADP has helped organizations of all types and sizes for more than 60 years unlock the potential of their workforces. ADP's cloud-based talent portfolio -- which includes recruiting, recruiter training, outsourcing, screening and selection, onboarding, learning, goals, performance, data analytics, succession and compensation -- is expanded in breadth and depth with TMBC's technology, consulting and research.

MyPOV – Good summary of what customers can now expect from ADP + TMBC in Talent Management.

Overall MyPOV

ADP customers have for a long time looked beyond ADP for Talent Management. First because of a lack of ADP offering, then because of lack of competitiveness of the ADP Talent Management capabilities. That has changed since approximately two years (read more here) and ADP is showing success in selling Talent Management into its install base, with increasing momentum. The acquisition of TMBC should help this development, as ADP has more talking points and value drivers to start a conversation with Talent Management.

On the concern side, ADP will have to open doors that have not been open or have been shut for the vendor. Never an easy re-targeting effort. But a saturated install base on the Payroll / HR Core side forces the ADP go to market machine to focus on upsell and cross-sell anyway and the success rate of that market effort overall will determine much of ADP’s future success. And after install base - there is always the green field - a very different challenge for any vendor and here for ADP.

Overall a good move by ADP, good news for ADP customers, too – as we know that in the long run – suites always win. HR practitioners dread nothing more than integration issues, getting more automation from a single vendor is good for businesses, as suite level benefits come to play, and possible differentiators that matter (see e.g. ADP’s ‘data driven angle). We will be there to watch, stay tuned.