No time to watch – here is the one slide condensation:
Want to read on? Here you go:
Always tough to pick the takeaways – but here are my Top 3:
Unshackled – Northgate Information Solutions, the back then holding company For NorthgateArinso (now NGA HR) was a KKR company. Despite valiant answers from executives before the recent debt for equity transaction in November 2015 (see Reuters here), it is now clear that debt load hindered investments at the vendor. The transaction reduced leverage from 8 to 4.5 – a much more manageable load. Nonetheless the vendor keeps up its 4 fold HR services offering with HR Consulting, Application Management, Payroll and BPO offerings. And while the number of customers and serviced employees is up, the NGA HR employee count is down, which at constant revenues is an indication for improved efficiencies.
New HR services Offerings – The question of course was now what NGA HR would do with the new freedom, for me especially on the product side. And while the vendor maintained that the R&D investment is constant, not too much was shown in these regards. Good to see that the venerable ResourceLink product has received a new user interface. NGA HR is also jumping on the PaaS bandwagon at large partner SAP, with launching two Hana Cloud Platform (HCP) based applications. Both NGA HR Request Central and NGA Case Management Central are good early offerings here. What was surprising was that the vendor plans 50 more of these, we look forward to learn more on the scope of these. And good to see continued investment in Payroll Exchange (PEX), the ‘core’ of NGA HR’s global payroll offering. Beside Product, NGA HR is investing into Marketing and Sales, a good decision see why below.
Process Standardization progress – NGA has worked on process standardization for a long time, so it is good to see that the effort is now in Version 4.0, all the way down to Level 5 (physical mapping to system functions, though I will get more details later hopefully). Every service provider prides themselves of these processes, but few have them to this level, and putting them into place is hard, applying them to existing customers even harder. It is good to see NGA HR is working at all these three levels, and has over time created a substantial differentiation over the competitors in the field. It will be interesting to learn what will come in version 5 of the Service Maps machine learning, bots etc. are knocking on the door of advanced best practices for HR services.
On the concern side the vendor should use its new financial freedom to rethink where it wants to build its next generation BPaaS product. The Payroll Exchange product could become a HR Core system, including employee usage. NGA HR could also look at redundant payroll offerings it has in the UK, and certainly there are innovation opportunities both for the UK centered ResourceLink and ANZ focused Preceda product. To be fair we did not get briefed in detail here, so we will be happy to revise our view on the topic when we learn more.
Overall good progress at NGA HR, the vendor now has to execute on the sales side, never easy, but something that has been done and can be done. Stay tuned.
More on NGA HR:
Want to learn more? Checkout the Storify collection below.
Find more coverage on the Constellation Research website here and checkout my magazine on Flipboard and my YouTube channel here.
Unshackled – Northgate Information Solutions, the back then holding company For NorthgateArinso (now NGA HR) was a KKR company. Despite valiant answers from executives before the recent debt for equity transaction in November 2015 (see Reuters here), it is now clear that debt load hindered investments at the vendor. The transaction reduced leverage from 8 to 4.5 – a much more manageable load. Nonetheless the vendor keeps up its 4 fold HR services offering with HR Consulting, Application Management, Payroll and BPO offerings. And while the number of customers and serviced employees is up, the NGA HR employee count is down, which at constant revenues is an indication for improved efficiencies.
New HR services Offerings – The question of course was now what NGA HR would do with the new freedom, for me especially on the product side. And while the vendor maintained that the R&D investment is constant, not too much was shown in these regards. Good to see that the venerable ResourceLink product has received a new user interface. NGA HR is also jumping on the PaaS bandwagon at large partner SAP, with launching two Hana Cloud Platform (HCP) based applications. Both NGA HR Request Central and NGA Case Management Central are good early offerings here. What was surprising was that the vendor plans 50 more of these, we look forward to learn more on the scope of these. And good to see continued investment in Payroll Exchange (PEX), the ‘core’ of NGA HR’s global payroll offering. Beside Product, NGA HR is investing into Marketing and Sales, a good decision see why below.
Process Standardization progress – NGA has worked on process standardization for a long time, so it is good to see that the effort is now in Version 4.0, all the way down to Level 5 (physical mapping to system functions, though I will get more details later hopefully). Every service provider prides themselves of these processes, but few have them to this level, and putting them into place is hard, applying them to existing customers even harder. It is good to see NGA HR is working at all these three levels, and has over time created a substantial differentiation over the competitors in the field. It will be interesting to learn what will come in version 5 of the Service Maps machine learning, bots etc. are knocking on the door of advanced best practices for HR services.
MyPOV
Good to see the signs going upwards again at NGA HR, which were a little more a concern 12 months ago. Kudos to executives to candidly address the challenges in regards of sales performance (in 2015, 2016 looks much improved), restructuring (once again) HR consulting, and operating at a lower overall headcount. The focus is now on sales execution as NGA HR is one of the few HR BPO vendors that have been able to preserve their offshore execution capacity, now it’s time to get more utilization towards these centers, with large, long term BPO deals (like this one with ThyssenKrupp). NGA HR cannot create those from thin air, but overall signs and forces are pointing to a HR BPO revival, the questions is when that will be. As shared and recorded by us many times, HR executives often get ‘cold feet’ – even after having selected a vendor for a global payroll BPO and then tend to delegate rollout decision back to the different regions. The sooner the industry and NGA as a key vendor can tackle this phenomena, the better for enterprises and players in the market. Global processes in Finance and Procurement are already best practice and reality in most enterprises today, so the question here is – when will the hammer drop for HR?On the concern side the vendor should use its new financial freedom to rethink where it wants to build its next generation BPaaS product. The Payroll Exchange product could become a HR Core system, including employee usage. NGA HR could also look at redundant payroll offerings it has in the UK, and certainly there are innovation opportunities both for the UK centered ResourceLink and ANZ focused Preceda product. To be fair we did not get briefed in detail here, so we will be happy to revise our view on the topic when we learn more.
Overall good progress at NGA HR, the vendor now has to execute on the sales side, never easy, but something that has been done and can be done. Stay tuned.
More on NGA HR:
- Progress Report - Progress Report - NGA sees Global Payroll BPO as the future - as other businesses are under pressure - read here
- Progress Report - NGA moves on - but in many directions - read here
- NGA executes - but what is the ultimate positioning? Read here
Want to learn more? Checkout the Storify collection below.
Find more coverage on the Constellation Research website here and checkout my magazine on Flipboard and my YouTube channel here.
