Progress Report - ADP shows great vision, delivers product innovation, now it needs to deliver adoption

Tough to pick the Top 3 takeaways – but here we go:

• ADP has delivered – When I first saw the demos and mockups of ADP’s new interface and product architecture at the Meeting of the Minds (MOTM) conference this spring in Orlando, my (conservative) bet was 50 / 50 that ADP would deliver in September as promised. It’s simply too easy to show nice demos and mockups and then often too hard to build them in real software. I raised my confidence a few weeks later when visiting the Innovation Lab and talking more in detail with Roberto Masiero and Keith Fulton and their teams. Talking to some of the new hires and seeing talent and background my odds went up to maybe 80%. Often even very talented people don’t make dates. But after today’s briefings it’s clear that ADP has delivered to the vision and ideas of MOTM (what I called a front end renovation strategy back then) and delivered its new user interface, delivering new user experience with the interactive paycheck, and Benefits Enrollment this September. Both are only a start – but have good seasonal arguments for them – HR Tech is coming and Enrollment is starting for most enterprises. And naturally paycheck related innovation reaches most eyeballs in the ADP user community.
  
  What I missed back then – or wasn’t briefed on – I tend to belief the latter of course – is that the team took a platform approach to deliver the new applications. And already in April ADP published the platform to the community at developers.adp.com. This gave ADP more eyeballs and more validation, something always helpful for new platforms. On top of that platform ADP created a declarative Visual Design Language (VDL) to build systems – a good move to ensure consistency across products and developers. If all works ADP should pick up significant speed in the next quarters and deliver a very large number of new UIs for many / most of their products in 2015.  

CEO Rodriguez opens the analyst meeting

• ADP doesn’t stop here – Beyond the new user interface, ADP plans to deliver innovations in Social HCM (mostly around Performance Management), very interesting Benchmarking capabilities (both in pilot today and coming 2015, my guess it at MOTM), Data Mashups of HCM and non HCM data for true performance insights (summer 2015) and predictive analytics capabilities (later in 2015).
  
  But even before all of the above, ADP will make available its Marketplace (again my guess is for HR Tech) – that will open up for partners and customers. We have seen a number of marketplaces being more quietly (SuccessFactors) or loudly (Cornerstone) launched – so this seems to become a trend. And it makes sense to lower integration and purchasing costs for customers, but at the same time increases the stakes of the game not only from a platform perspective, but also a commercial perspective (invoicing, payment are just a few examples). 

 

The ADP Lab is in good company as Masiero shows

• New Innovation keeps coming – As if the above wasn’t enough, ADP is also actively working on their next generation architecture. It has many very compelling and modern design characteristics like a global object model that will be kept in memory, using columnar database technology, fully declarative execution and forming a backend to the existing VDL UI. We need to learn more on that asap, but definitively one of the more innovative HCM architectures out there. And the ADP team seems to be already on the way – sharing size of the object model graph and access times (no surprise, superfast) with the analyst community. And with an open source first approach the ADP team has been able to build the next generation platform at impressive speeds. It was too early – or ADP didn’t want to share yet – what the first use cases will be, but definitively an area on which we will keep a key eye on. 

 

Deliverables and design principles of the new ADP UI

Tidbits

• DaaS Opportunity ahead – It was good to catch up with Ahu Yildirmaz, the Head of the ADP Research Institute that prepares the monthly ADP National Employment Report, which turns out to be remarkably accurate. ADB is building on this capability with the launch of a new workfroce index next month, designed to provide a clearrer picure of the vitality of the U.S. workfroce and emerging trends. nd with ADP paying 1 out of 6 paychecks in the USA there is enough data to be more than ready for some benchmarking and further data related activities and services. Good to see some of those on the roadmap for 2015.
   
• Global View makes progress – It was good to catch up on GlobalView with Stuart Sackman and David McIninch. The product makes progress and has interest of prospects, but is challenged with the innovation happening both in house and at long term partner SAP. Innovation is great but you need terra firma for global rollouts. And ADP partners with SuccessFactors and Workday, with the sound directive that the customer should always win. Certainly a good bearing but it will be good to see more of an ADP product / IP strategy for GlobalView, too, creating more differentiators over pure services competition in BPO.
   
• Focus on global compliance - ADP is building on their global footpring and deep knowledge to position themselves as the leader in Global HCM compliance. For examle ADP supports the statutory rules and policies for Social Benefit managament in China, where work rules vary by city.
   
• Analytics – but really dashboards – ADP is creating a promising dashboard product, that makes suggestions to guide the path of analysis, as demoed by Richard Wilson and Vikas Saini, it is tackling key performance questions and includes non HCM data – what most users want to see. It would be good to have the product making recommendations in even stronger voice, but a good start (see my take on ‘true’ analytics here).
   
• Recruiting – shows the need for a new UI – Next we looked at Talent Management, and as briefed together with Bill Kutik and Steve Boese, not surprisingly a lot of Recruiting. The functionality is solid and good – but the user experience is a few years old. So it’s timely the new VDL powered UI is around the corner. I’d expect ADP to show mockups shortly. And then there is the alternative view, making the recruiter obsolete (read here) which isn’t reflected. I also think ADP needs ‘guerilla’ / viral ways to get Talent Management functionality into its customer base, as perception, access to decision makers and sales skills take a long time to develop.
   
• A blossoming Innovation Lab – Next we met with Roberto Masiero and Keith Fulton, the two drivers behind the Innovation Lab. If ADP customer like the new products, these are the gentlemen to send the fruit baskets to (they will share them with their teams). I was impressed that they found time and energy – despite the remarkable 9 month only ingestion time for the Innovation Lab and new user interface – to come up with the next generation architecture. Being able to disrupt yourself while disrupting ADP is remarkable.
   

• Compelling UIs are coming – Last but not least a sneak previews on the Talent Management UIs with Anna Carsen. They all look clean, easy to use and well thought through. And it should not be a surprise, as the team does robust usability and focus group testing. Good to see the progress. 

MyPOV

At Constellation we always have the customer in mind, and it looks like ADP is coming around and offering its customers (and prospects) a really compelling product vision and roadmap with early proof points coming this year. It makes sense for SAP to start with Paycheck and Enrollment related products, and most of the innovations will hit the masse of products in 2015 – which is going to be soon. Coupled with innovations around social, BigData and Analytics the future for ADP customers looks bright from a product direction.

But getting there is hard and while ADP is migrating a lot of customers, adoption of new products being the area of attention. And it’s one thing to build a great (the current approach) product or a solid product (Vantage) and then get it adopted. The slow adoption of the ADP Talent Management products may serve a warning. So ADP needs to get adoption of these new products right in its huge install base.

Last but not least we heard before the event that ADP veteran Michael Capone is leaving the company, to pursue a long term calling in the healthcare (software) industry. The team under Capone is very strong and this analyst day certainly showed that – but there is realistically a (small) cloud on the ADP horizon. It’s now to Rodriguez to find the right leader of the product organization that is currently in flight – not a walk in the park, but with a strong team certainly doable. We will be watching closely.

• Site Visit - ADP's new innovation lab in Chelsea - read here
• News Analysis - ADP announces Spin-Off plans for Dealer Services, sharpens ADP's focus on HCM - read here.
• Event Report - ADP's Meeting of the Minds - ADP has made up its mind (almost) - customers not yet - read here.
• First take - 3 Key Takeaways from ADP's Meeting of the Minds Conference Day 1 Keynote - read here.
• ADP innovates with with verve and good timing – read here.

• Could the paycheck re-invent HCM – yes it can – read here.
• And suddenly, payroll matters again! Read here.