by Julie Fernandez, Director - CHRO Services, TPI
The North America payroll administration outsourcing market is constantly evolving. Different types of clients require different solutions, and providers continue to refine their offerings to meet the diverse needs.
In recent years North America payroll providers have been stretching their outsourced payroll services so that what was once a specialized “service bureau,” fulfilling functions such as tax filing and check printing, is now broadened in scope to include traditional payroll processing as a basic package.
Heritage payroll providers, such as ADP, Ceridian and NorthgateArinso, offer core strength in the proprietary payroll systems they bring to clients who lack their own ERP payroll modules. Large HRO providers such as ACS, Aon Hewitt, Accenture, and IBM are more commonly considered when a client is interested in a custom ERP payroll module with some degree of outsourced support ranging from technology only to fully outsourced payroll administration.
Middle market clients and those who need HR technology are likely to consider software-as-a-service (SaaS) providers such as Workday, Ultimate, and Sapien – all of which have payroll modules for the U.S. and Canada. Service providers have actively developed their client relationships to take on more upstream payroll activities, including data management and zero-to-gross activities as well as direct contact center support for payroll inquiries. At the same time, payroll providers have sought to broaden their scope to include payroll-touching areas like workforce administration, benefits, timekeeping, and others.
In 2010 and 2011, SaaS technology providers have generated a great deal of publicity about their global HR suites, which include North America--only payroll modules. To date, most have partnered with third parties to add outsourced payroll services to their technology-only solutions. Talk of partnerships for additional country payroll capabilities is rampant, but still emerging and opportunistic.
The options are increasing in number and specificity to meet the growing market. Among all the change, one fact remains clear: few clients choose to repatriate payroll functions once they are successfully transitioned.
Check back here shortly for part two in my series of payroll-focused posts, which will focus on the approach that global payroll providers are taking to help clients succeed in multinational environments.