HR Systems & HCM Industry Outlook FireSide Chat

Jun 23, 2021 12:00 PM1:00 PM EST

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Key Discussion Takeaways

Which vendor is best for your company? Why won’t simple benefits packages entice potential talent anymore? Why shouldn’t you underestimate Microsoft? Jacqueline Kuhn is here to tell you.

Jacqueline Kuhn is the Co-owner and Executive VP of Strategic Services at HRchitect, a leading consulting firm dedicated to delivering expertise around HCM technology and software for organizations. Jacqueline has over 25 years of experience in HR and technology solutions and knows the HCM industry like the back of her hand. She’s here to explain the best vendors for your company and how to handle growing out of your current system.

In this virtual event, Greg Irwin of BWG Connect talks with the Co-owner and Executive VP of Strategic Services at HRchitect, Jacqueline Kuhn, about everything you need to know about HCM services and vendors. They discuss the impact of hybrid workforces on payroll, which vendors are best for HCM, managing the cost of healthcare benefits, and much more.

Here’s a glimpse of what you’ll learn:


  • Jacqueline Kuhn explains HRchitect and her specialty in HCM technology and software
  • What HR issues do people have when they come to HRchitect?
  • How companies can outgrow a system
  • How has the increase in hybrid workforces impacted HR and payroll?
  • The evolution of recruiting and why simple benefits won’t attract talent, especially if they’re working from home
  • Jacqueline discusses the multitude of vendors to choose from and which ones companies are gravitating towards
  • Jacqueline ranks popular vendors based on momentum
  • Which vendor will work best for your company’s needs?
  • Jacqueline mentions something every HR professional should know about the vendor market — don’t underestimate Microsoft
  • The cost of healthcare benefits and how companies can work to decrease them
  • Why employers aren’t offering daily pay options to employees
  • How to craft the most enticing and effective benefits package

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Event Partners


HRchitect is a consulting firm that specializes solely in Human Capital Management and delivers expertise around the full lifecycle of HCM technology. They've helped thousands of organizations across the globe create strategies, select, implement and support Talent Acquisition, Talent Management, HRIS, Workforce Management and Benefits systems.

Connect with HRchitect

Guest Speaker

Greg Irwin LinkedIn

Co-Founder, Co-CEO at BWG Strategy LLC

BWG Strategy is a research platform that provides market intelligence through Event Services, Business Development initiatives, and Market Research services. BWG hosts over 1,800 interactive executive strategy sessions (conference calls and in-person forums) annually that allow senior industry professionals across all sectors to debate fundamental business topics with peers, build brand awareness, gather market intelligence, network with customers/suppliers/partners, and pursue business development opportunities.

Jacqueline Kuhn

Jacqueline Kuhn, HRIP LinkedIn

Executive Vice President Strategic Services at HRchitect

Jacqueline Kuhn is the Executive Vice President of Strategic Consulting Services at HRchitect, the only consulting firm that specializes solely in human capital management (HCM) and delivers expertise around the full lifecycle of HCM technology. In her role, she oversees HRchitect’s HCM strategic consulting group, which encompasses the company’s HCM systems strategic planning and evaluation and selection process.

Jacqueline has over 25 years of experience in HR, strategic planning, systems and project management, and services delivery. She is a Certified Professional of Human Resource Information (HRIP), a sought-after speaker at industry events, and has been published in professional magazines and journals.

Event Moderator

Greg Irwin LinkedIn

Co-Founder, Co-CEO at BWG Strategy LLC

BWG Strategy is a research platform that provides market intelligence through Event Services, Business Development initiatives, and Market Research services. BWG hosts over 1,800 interactive executive strategy sessions (conference calls and in-person forums) annually that allow senior industry professionals across all sectors to debate fundamental business topics with peers, build brand awareness, gather market intelligence, network with customers/suppliers/partners, and pursue business development opportunities.

Jacqueline Kuhn

Jacqueline Kuhn, HRIP LinkedIn

Executive Vice President Strategic Services at HRchitect

Jacqueline Kuhn is the Executive Vice President of Strategic Consulting Services at HRchitect, the only consulting firm that specializes solely in human capital management (HCM) and delivers expertise around the full lifecycle of HCM technology. In her role, she oversees HRchitect’s HCM strategic consulting group, which encompasses the company’s HCM systems strategic planning and evaluation and selection process.

Jacqueline has over 25 years of experience in HR, strategic planning, systems and project management, and services delivery. She is a Certified Professional of Human Resource Information (HRIP), a sought-after speaker at industry events, and has been published in professional magazines and journals.

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Discussion Transcription

Greg Irwin 0:18

Good afternoon Good morning everybody. It's Greg Irwin at BWG and I always enjoy our conversations here with Jacqueline Kuhn over at HRchitect, and Jacqueline and her team - events we can wish to be recorded please just - sorry about that guys. So we've been speaking with Jacqueline and her team for years about the trends in HR. And it's never been more relevant than an important than then right now is kind of there's the major reshuffling in terms of the hybrid workplace. Quick reminder on guidelines just says that by joining you agree not share any nonpublic info or anything covered by confidentiality I was confirming, not bound by any obligations to maintain the confidentiality of any of the information being shared. Jacqueline's, a longtime participant and of course as all necessary approvals to be participating in this forum. Now as we go, please remember you can and I really want to encourage you to send us questions, email them to us at RSVP And those pop up here live during our session, and I will I'll bring them into the conversation as you send them. So please, please do. Jacqueline, do us a favor, kick us off, please give that intro here on HRchitect, and a little bit on your background as well.

Jacqueline Kuhn 1:38

Sure. So HRchitect is a HCM HR technology consulting firm, we specialize all we do is HR, we do everything from shorting to retirement, we have two lines of business, my line of business, I help our clients figure out what technology they need to support their business. And then we have a line of business where we actually are certified to implement a couple of products, we have a new partnership to announce as well we currently implement the entire UK G Suite, former Kronos former LP, they're now Ukg the every product in the suite we can implement. We also implement workforce software and a newly announced partnership with Ceridian Dayforce. So we are are venturing into that world in an implementation partnership, my side of the house, we are vendor agnostic, our clients choose whatever systems are appropriate for them. And because there are hundreds of products in the marketplace, less than 75, less than 25% of what client of ours chooses we actually implement. So in that way, we are truly vendor agnostic. And yeah, that's really interesting what's going on right now. We are busier than ever, we are 120% over last year, which was flat to 2019. So last year was good given a COVID year being flat to 2019. And we're 120% over that at this point and with demand on people looking to purchase and no stopping in sight.

Greg Irwin 3:30

So you jumped right in. And I always appreciate that you kind of get to the get to the facts, you can you shared the opinions, you share the big picture, but you also share the fact. So what what kinds of projects are people coming to you for what are they What are people greenlighting and spending money on?

Jacqueline Kuhn 3:46

They're spending money on upgrading their, their entire HR technology suite if they can afford it. So they're they are carefully looking at what they need today and in the future, assessing what they have and doesn't meet their needs and then buying what they need. So everything from I'm just buying a new payroll system to I'm replacing I'm ripping and replacing an entire suite I've been on for 10 years.

Greg Irwin 4:18

Can you explain why? Why Why is there a critical need that when they go to the CFO and say I want to do this? And here's my reasons, the CFO says Yep, that's important. We need to do that.

Jacqueline Kuhn 4:31

It's coming in two different camps. The one camp is it. We bought it so many years ago, and we were a different organization. We were smaller. We were not global. We only had one line of business and we've just outgrown, right we we bought that three bedroom townhouse as our starter and we now need a five bedroom home with a yard right? So I've outgrown it, the other side He is really, we've discovered that what we bought does not, even though we may have bought it two or three years ago, even as recent as that, given the way we need to work and given the way we need to make data driven decisions, and given the change of the world, we need better tools to offer to our people. And therefore we're going to assess everything we have, and then determine what needs to be replaced to better meet the needs of our employees and our leaders.

Greg Irwin 5:33

So when the both of those follow the same thread, and I'm going to ask you now a little more specific. So when you say when somebody outgrows a system, what does that mean? That mean? They they can't do the proper reporting? Does it mean it's too manual, and it takes too much time to, you know, to implement changes what what is outgrow it mean?

Jacqueline Kuhn 5:53

Yeah, it means both of those, but more fundamentally, it the configurability of the system is limiting them from how they can make these changes. So a really good a good example is a client of ours who is on a small one of the pays, I won't mention which one client is on one of the pays. And the workflow in in the in this particular system doesn't allow for cross department multiple level approvals. And so in order to get things approved, there have been a system happening now they've outgrown it, I mean, their organization used to be two layers deep. Now they're seven layers deep, right? So they just can't, this, the system cannot support the way the organization works anymore, because the organization is too big. And so now they're doing things in two places. So they need to upgrade. The Yeah, it's really as basic as that some of it is reporting. But it's really more basic as to we leave aren't we are more complicated today. And we need to be able to configure our system to help support that complexity.

Greg Irwin 7:13

Got it, there are three areas I want to talk about, I'm certainly for this call, going to dig into some vendors and to some vendor momentum, I promise I'm gonna ask about the daily pay from from Ceridian as well as others. But I'm gonna go with a really basic one first, which is hybrid workforce, more people are at home, which actually means more employees are in multi state. When we talked about that, a couple months ago, you and I said that's a real driver here for fundamental payroll and improvements in fundamental payroll. My question is, is that still happening? When we see strength? Is it across the board here in terms of just fundamental payroll services as well? And maybe there's more you're seeing here in terms of what it means for an HR system, when you have more people working from home are impossibly in different states?

Jacqueline Kuhn 8:05

Yeah. So it actually is a little more complicated. And then just being able to pay people that way. It's actually it when you look at creating an end to end process, it's how do we track where our people are located? And then how are they going to track their time, especially people who are exempt and don't have to clock in and out, we no need for them to track their time and where they are working. And so and then all of that needs to feed into payroll to pay them properly. So it really is kind of like now HR has to say, okay, we need to capture where people are working, where they live, how often they're there. And they need to report their time where they're getting their work done so we can pay them appropriately and be in compliance. The other complication that that hybrid workforce is bringing is how in salary planning and especially when in the HR world we think of things now more his way of market pricing. What What is the market for that job? Well, if I'm in a major metropolitan city like Chicago, I live in the suburbs of Chicago. I don't work downtown Chicago, ever. But if I'm hybrid commuting Sundays working from home other days, do I still need that market rate of working in downtown Chicago? How should I be paid? If I am home more than I am downtown? Is my base pay gonna change? Is my compensation package going to change? Do you know I used to get commuter benefits. I don't really need them anymore. And they were helpful, but I don't need them now. Right. So it's really looking at how do we what kinds of packages do people need? From a cost perspective to be whole, given that we now have all these hybrid situations.

Greg Irwin 10:08

I'm gonna ask it explicitly, because I'm hearing this and I'm thinking to myself in this environment, are any companies getting away with reducing people salary in return for a hybrid, you know, remote work arrangement?

Jacqueline Kuhn 10:28

I haven't heard of it yet. But I do know people have eliminate well are thinking of eliminating for the 2022 benefit plan year, some of those benefits, the commuter benefit, the real, you know, the band benefit that the car, the reimbursement, that kind of thing. Yeah, maybe not the base pay, but they are definitely re evaluating the benefits that are offered in those packages.

Greg Irwin 10:54

Got it, got it then the flip side of this, when we talk about is just, you know, unemployment is incredibly low. It's a it's a, it's an increasingly tight market. And recruiting and recruiting functions, I think, are coming to the forefront. So where is recruiting right now, and in the conversation, or as a driver of, you know, of these of these discussions?

Jacqueline Kuhn 11:21

So, as we have, honestly, about 14 active projects right now, which is crazy, right? So, which we usually do 14 a year, we have 14 active right now, almost two of our 14 projects, recruiting is the number one or number two priority in all the two. And it is it is so important, because not only are the people who want to work working, and the only bet is that the people who want to work are working to to get somebody to move from one employer to another is a bigger challenge today. Because it's not about location. It's not about oh, I you know, I was commuting two hours, I'm now at home. It's about what do you give me while I'm working at home? What what equipment? Are you going to give me? Are you going to pay for my internet? Are you going to you know, what does that comp package look like? And, and and it's about and oh, yeah, and why I'm working from home? How are you going to develop me? How are you going to, you know, help me for my next opportunity. So. So it's really about attracting the person and the people who fit into your hybrid culture. And the struggle of organizations to communicate and market what their culture is, like, in a hybrid world is, you know, it's like, does it really matter to show the employee cafeteria and everybody having fun if two thirds of the workforce is good isn't going to be there on any given day? So you know, how do I market my organization now? And so the the big push now in recruiting truly is leveraging of AI, automating automating everything. No one person interviews paradox, the AI Olivia, literally is a robot doing screening calls, you know, you don't need a person, you just need to make sure you're asking the right questions. It's just flipping recruiting all over on its side to more of a sourcing strategy, not an applicant tracking, it's how do we source how do we market? How do I know I'm get how do I get the right people to come into my organization? And then if you think about that, then you've got the onboarding conundrum, how do I onboard someone properly if they're working from home?

Greg Irwin 13:54

I'm going to let you know I always talk vendors. So I'm going to jump right at it. Or I should say services since how many of these are online? What are the most interesting, I'll start with? I'll start with the basic What are people buying? And then we can talk about what you think are the most interesting. So two different things first, first, is where's the money going? Where's the money going in recruiting? Those 12 projects you've got, give us a wild guess of some of the some of the beneficiaries that are that are going to be you know, winners in that in that trend.

Jacqueline Kuhn 14:28

Yeah, ISENS will absolutely be a winner. Smart Recruiters will absolutely be a winner. And Workday and to some extent UKG will be winners for people who don't want to buy a one off. Perfect, but those are going to be the winners on the recruiting front and then almost everyone will tie on something like parrot will tie on paradox or something like it.

Greg Irwin 14:57

Got it. What about like an eightfold and the AI and you know, he says those folks, I'm not sure how attuned this whole group is to it. But the idea of, you know, marketing your existing base of past customers and clients and employees for for those roles and leveraging your ecosystem and using AI to kind of search among that pool for the next employee or past past employees in different roles to fill jobs, is is that all part of this conversation? Or is that really just cutting edge people, you know, the leading 10%, that by those types of solutions?

Jacqueline Kuhn 15:34

It is a part of these conversations. And that's why ISENS, and smart recruiters are leading the way, because that kind of AI is built into their solution, you don't need to buy a third party

Greg Irwin 15:46

Got it got a lot of folks who are interested in more mid market, or even SMB systems, from the likes of a paycheck, up to a de force, are any of those platforms, which of those platforms have have high quality recruiting capability?

Jacqueline Kuhn 16:11

In my opinion, none of them? Because they don't do they have applicant tracking systems, they're really good about keeping you in compliance, once you have identified people for an open job, but they don't, unless they work with a partner, but they don't natively in their platforms have any of that sourcing stuff that front end that marketing. They don't have any of that. You know, they they have basic traditional applicant tracking systems.

Greg Irwin 16:52

Got it. Got it. Let's, let's go for a second and talk about the the platforms themselves. You and I always talk Workday, and Ceridian and UKG in the mid market. And I think there's a lot of interest here among this group around some of the smaller solutions you're at from ADP, Paychex, and the pace of the world. Can you tell us a little bit about in just our check in Jacqueline of who you see doing well, in those categories?

Jacqueline Kuhn 17:26

Yeah, so I see PayCom and Paylocity doing very well, very consistent. And, and really driving that single use platform in the SMB quite well. They, you know, they they win, you know, more often than not right. The the other pays Paycore nipping at the heels, restructuring making some really key partnerships last year with benefit brokers prior to last year, they never did that so Paycore is actually you know, nipping at the heels, nipping at the PayCom Paylocity etc. Customer, I really don't I haven't seen Paychex in a long time. They're they're further down market than I ever go. So I really can't comment on them other than you know what I hear other people when it seems like folks who have adopted Paychex are in the Paychex Flex are very happy with it. I find that that people aren't aren't really going anywhere. They're pretty happy with ADP. We continue to see people on the workforce and our product looking elsewhere for HR applications, they may you know, the payroll is working well for them but the other HR things the performance, the comp the talent acquisition learning are not being those needs aren't being met. So while we see ADP perhaps retaining the payroll piece those those other skews that you might buy from ADP are going elsewhere and they're going to the SMB providers like a clear company like a even though job bytes enterprise to but like a job bite, a greenhouse. You know, to some extent they're they're going to be going to a sum total for a full suite. So yeah.

Greg Irwin 19:47

Interesting. I have a question. So what's interesting is at it sounds like Ceridian and UKG are not in play as much for the ADP base, because they require you to move your payroll over. I guess I'll ask is the churn rate of ADP? We've You and I have been talking about that for a long time. And it never seems like it's really just stabilized. But I'm wondering who are the key beneficiaries then of ADP churn? And have you seen any any slowdown in AD feature?

Jacqueline Kuhn 20:25

Yeah, so what, what tends to happen is there still is ADP churn. Although I, you know, I think, you know, PayCom and Paylocity are the bigger benefactors when people want to move off of ADP payroll as a whole, right? Because then they're going to move to one of those other providers. When an organization who is on ADP starts growing and has multi and is in multiple, multiple companies, or starts going global, and is in multiple countries, and begins to grow up from SMB into mid market, that's where Ceridian and ultimate and UKG in UKG tend to take over, right, like I've got now 10 companies, I'm growing by acquisition, I'm in, you know, 15 countries, I need a better HR solution, I want, you know, a little more robust payroll, I don't want to have to have seven logins for my seven at the end. So I'm, I'm gonna step up. So when when Ceridian and UKG are benefactors of ADP is that larger customer, you almost never see Ceridian and UKG competing with a PayCom or Paylocity. Because they're just two different markets. UKG in Ceridian typically never go down to that below 500, below 300, even, you know, customer. So so I think that's really where ADP gives to everybody in that sense. And they give to the SMB and they give to the mid market, but for different reasons in both markets.

Greg Irwin 22:08

Amazing. There are just so many vendors here, it's it's really difficult to keep track of it and so many different requirements. And it all gets bundled into this umbrella of HR tech. What I'd like to do with you, Jacqueline is go through our standard one to 10 scores on the vendors. This is about momentum. I know it varies based on use case. And it varies based on customer size. But you know what, this is anecdotal about what Jacqueline is seeing in terms of just doing a good job, and ultimately gaining gaining more customers. So let's start with ADP and do a run through quickly. And it might open up some ideas in terms of some things that are happening at some of these vendors. What's your one to 10 momentum score for ADP?

Jacqueline Kuhn 22:57


Greg Irwin 22:58

What's your what's your score for Ceridian?

Jacqueline Kuhn 23:01


Greg Irwin 23:02


Jacqueline Kuhn 23:03


Greg Irwin 23:04


Jacqueline Kuhn 23:05


Greg Irwin 23:06

And I'm going to do some of the pay through the pays PayCom, different customer than Workday for sure but PayCom?

Jacqueline Kuhn 23:14


Greg Irwin 23:15


Jacqueline Kuhn 23:16


Greg Irwin 23:17


Jacqueline Kuhn 23:18


Greg Irwin 23:19

Interesting. Who did we miss? We I think we just did them all. Oh, I got one Cornerstone and the meaning to ask you for calls and calls about Cornerstone. Cornerstone?

Jacqueline Kuhn 23:30


Greg Irwin 23:31

All right, excellent. So this this except the landscape we've talked about ADP, and we know they're phenomenal in terms of payroll, but they've always had challenges on the full HR stack. Let's spend a minute here talking on Ceridian how Ceridian Dayforce doing?

Jacqueline Kuhn 23:49

I think they're doing very well on I you know, they they are winning their fair share. And they are they are in how we put this. So they're a company who is transforming from a payroll service Bureau to a global software company. And so as as sales go, they're performing solidly, but because of this transformation, post sale, we are seeing some struggles, we're seeing struggles in support, we're seeing struggles and implementations. And we're even seeing some struggle on the sales side with the the difference between a traditional payroll service bureau salesperson versus a global software sale right so there's some there's been some churn a good you know, we needed churn in order for Ceridian to complete this transformation. But that's but it's still hit or miss right there. It's still like one perfect example is at one of our clients, Ceridian was in, they they came in, they demo their product. And they missed on showing some of the capabilities the client wanted to see, showed capabilities the client had no interest in, right, they were trying to sell what they wanted to sell. That's the old way of selling, that's the old way of selling, right? You don't have a client who is going to maybe leave. And this particular client was on PayCom. So they're going to leave PayCom for something. It's not like they they've never seen anything, right. And they kind of did the old the old way. And, you know, and then when you try to explain, you know, trying to explain to them why they lost. So there's still some of that, which is why Ceridian isn't a nine, or 10, because they still have some of that. And then because they have sold well, and they don't have a very large partner ecosystem. They are very much lagging in their implementations. They still have some backlog and then because they sold so well, they haven't hired their support team up as much as they want to, they just can't find the people, right. I mean, they're there. They're a victim of not being able to find people. And so some of the post implementation services we have clients struggling with, they're they're trying to work it all out. But I think that they're still a company in transition.

Greg Irwin 26:33

Are they winning net new logos? I'm sure they're flipping the old Ceridian face today. Force. We've talked about that for a while. But the question is somebody who is not legacy Ceridian? Are they? Are they winning more than their fair share of that group?

Jacqueline Kuhn 26:52

There, Yeah. So there's there is no more legacy Ceridian that was gone. January 2021. Was it because they're all gone? So everything they do, since that has been a net new logo, and I think they are winning their fair share. And they're there, I would say, out of every 10 deals, they're probably winning like four of 10. Now, or up to maybe five to 10, five or 10, whereas before they were winning two or three, right? So they're absolutely winning more than a part of that is has nothing to do with the payroll platform. But it has to do with the fact that they they have really invested in the other areas of their benefit platform, what you can do on their benefits platform. Absolutely fantastic. Their compensation and performance is better. Talent Acquisition has a bit ways to go their learning is better. So they've invested in developing out those other areas. So now they're being seen as a full suite. By some folks were before they weren't.

Greg Irwin 27:59

Alright, excellent. Let's go to Workday. I understand that a lot further up market that you have a question, how is Workday doing?

Jacqueline Kuhn 28:10

Yeah, Workday is doing very well. I think they're, they've really gotten their arms around how to sell in the mid market that they that they can sell to, right? I mean, they're not going to go below 100. Not very often anyway. But in that 800 to 1500 2000 market, they've really got their act together. They have their process together, they have their price point together. Their implementations are still a little pricey compared to UKG or Ceridian. But they're way down from what they were. And I'm seeing work they be successful in bundling in the mid market finance and HR together, particularly for those organizations who have who are currently a JD Edwards or a Lawson ERP customer. really attractive moving to workday for HR and finance. Yeah.

Greg Irwin 29:13

Excellent. We have a question on Oracle. I think it's a very similar model, I presume, but I'm going to I'll ask you, are you seeing Oracle HR?

Jacqueline Kuhn 29:23

We have Oracle in over half of our current deal. And unfortunately, they are not rising up to the top to in any of our deals.

Greg Irwin 29:38

Why not?

Jacqueline Kuhn 29:42

Well, it's a couple of different things. A part of it is the buyer doesn't believe that Oracle Is as the buyer who would buy Workday versus Oracle has more confidence in Workday. Let's put it that way. So, you know, the buyer looking at that would have more confidence in Workday. And I think the Oracle Sales Team that we have seen have not necessarily been like the a team, like you see with the Workday, right. So, you know, Workday sales team comes in, they've got every I dotted and T crossed. They they know the answer to every question. They have a small team of people where Oracle has a cast of 1000s. You know, they're in a, they're in a mid market deal. We're talking a 2500 employee company, right? They have a sales rep and 15 people to give an HR payroll demo Workday has a sales rep and two people. Right. So the the impression you get is Oracle is big, it's complicated. It's you know, and and Workday and the end, the impression is, yeah, Workday knows how to relate to me. So I think that there's a relatability. Now that worked a guest that Oracle has to get in the enterprise sector, we absolutely see Oracle's succeeding. Because that's kind of their bread and butter and where they played the in the enterprise. They absolutely I would say, you know, workday versus Oracle in the enterprise. It's like 50/50, you could flip a coin as to who's going to win any day, but not in the mid market.

Greg Irwin 31:36

Interesting. Interesting. Let's, let's go over to Cornerstone what's what's your thinking on the positioning of Cornerstone the direction of Cornerstone? How often are you seeing them? Are you not seeing them? Tell us tell us a little bit of the story in background.

Jacqueline Kuhn 31:54

Yeah. So we, we have been seeing a lot of Cornerstone. I'm learning in short, you have not yet we have Yes. Oh, yeah, we have. Yeah, learning is a big part of the new way of working and having access to development. So it has been big. The challenge with the challenge with Cornerstone is the legacy Saba customer who feels left out when we have a legacy Cornerstone customer there, they don't want to move off Cornerstone right in we're not seeing the the big move to take what they have on Cornerstone and now move it all over to Workday, maybe piece by piece, but it's not like a big move, right? It's not like yeah, we're gonna move everything off. We are seeing that on the legacy Saba stop, because the message that the legacy Saba customer is getting is we may not this product may not be here forever. And so those customers are taking a fresh approach to the market may or may not stay with their Saba product, more than likely are moving to the products that their HCM vendor offered the performance the learning the whatever. So I think that's the dip. That's what that's kind of the the theme that we're seeing so far on the Cornerstone side, in a net new sale. We do not see Cornerstone positioning Saba at all. And that is probably why Saba customers are nervous as to what's going on.

Greg Irwin 33:46

You know, I call migration is it logical migration for Saba for Saba customer to move over at some point to Cornerstone or is that just such such a painful thing that they would? might as well put it up for bid and there are other other better alternatives out there?

Jacqueline Kuhn 34:03

Well, it's, it's even different than that, Greg, because when I was evaluating, if I chose Saba, I purposely chose that over Cornerstone, right? I pretty much was in every bakeoff doing Saba versus Cornerstone. So I deliberately chose Saba over Cornerstone, you're gonna have to convince me that something is different or better for me to literally change my mind about my preference. I liken it to a choice. I get you. Well, they do. What's the choice? They go to some total? They go to their ACM vendor? Yeah, they have a choice. Cuz it's a new implementation there. It's not a conversion. It's, it's you're ripping it out and putting in something new. It is a completely different platform. So it's kind of how do I choose the platform? Who, four or five years ago I didn't want? Or do I just go out and buy something else? And and it's really more fundamental than that, because I'm in Chicago, right? I'm a Cubs fan. I am not a Sox fan. I never will be a Sox fan I am a Cubs fan. And, and you either like Saba, or you like Cornerstone, it's the same kind of thing.

Greg Irwin 34:16

I see, what about net-new, so you have 12 for started 14 projects, how many of them include learning? And Are any of them moving over to Saba, or some total or, or Cornerstone?

Jacqueline Kuhn 35:45

10 have learning in scope. And three of those are current Cornerstone customers, who will not be leaving Cornerstone the others, half are going to Cornerstone half, we're going to go to some Well, a third, a third Cornerstone third to some total third to the ACM, they're each getting an equal cut.

Greg Irwin 36:11

Got it. Is Cornerstone winning any net new?

Jacqueline Kuhn 36:15

In our case, they would be winning like three net new Yeah. Okay, three of our 14 net new they would be winning or 12 or 11. Basically, because of where they're in play three of the 11 that new they do winning Yeah.

Greg Irwin 36:29

We have talked about the competitiveness, the changing idea of learning to more of the YouTube learning, the micro learning, the bridge stuff where people choose their own path, a different learning experience, than then kind of the regulatory and compliance learning that I think Cornerstone is famous for. My question is, how is Cornerstone perceived and learning? Do you consider them still best in class? And having addressed those gaps? What do you think they do have a gap, that that's problematic for them?

Jacqueline Kuhn 36:59

The greatest gap that Cornerstone still has is in skills and competency tracking, and development, because they don't have a built out skills models fully built out in their learning platform. And that is, that is the biggest gap that they have that organizations want. You can do it but not in learning. You need other modules to do it. They've kind of got phase one rolled out. They're working on on subsequent but that really is their their biggest gap right now.

Greg Irwin 37:40

I got it. And is there one learning vendor out there that is, you know, the the Workday of years past in HR, where it was just the, you know, one step ahead in terms of the generation of product? Or, you know, or is there not that second better alternative standing out there?

Jacqueline Kuhn 38:04

There are so many learning products out there that it's almost a commodity, it's a price preference thing. There are about 120 ish, standalone learning management products out there. Wow. Yeah. Yeah. And some of them are very specialized to an industry. So if I'm in pharmaceutical, I got the compliance for that. So not I've got the OSHA compliance sewn up if I'm a convergence, right, I mean, that some of them are providers that are very vertical specific. And then some of them are general, like Litmus and Absorb and Oshibo. And all of those, you know, Meridian, I mean, it's just there's so much out there that it often comes down to who the learning leader is and what their preference is. And it's not uncommon for us to see multiple LMS solutions in a single organization just because of that.

Greg Irwin 39:15

I got a I got a great, great feedback. I I'm gonna let you know, I asked all the questions here. I want to encourage the group to send me a couple of your own email me at Jacqueline, I'm gonna give you an open ended, an open ended one, in terms of a trend that you're watching, or something that's surprising you this year. So it's wide open. And I'm going to let us kind of break the mold of going vendor by vendor by vendor. What's the what's something that you think this group should should understand about what's happening in the market?

Jacqueline Kuhn 39:55

So I think people have completely underestimated and forgotten about Microsoft, and their Microsoft Dynamics ERP platform. So Microsoft has this dynamic ERP platform. Pretty, it's pretty much mid market, you know, mid market, SMB based, they have, they have an HR component, and they've got partners that had built out great capabilities on top of what Microsoft provides, fully, fully integrated to all of the other Microsoft products and coding teams, and outlook and Excel and Word. And, you know, if you're a Microsoft shop, you can, you know, ubiquitously move from a Word document form up into the HR system, and it's just incredible. And there's still a lot of holes are still some gaps. But nobody is paying attention to them. You know, they've got LinkedIn Learning, right? They own they own LinkedIn. And it's a part of this is a part of the suite like full LinkedIn integration completely a part of the suite. And I think in the mid market organizations that have bought the dynamics ERP, of which a piece of HR is delivered, with the licenses, they're asking themselves, Hey, what about Microsoft? Should I be looking at expanding on my dynamics platform, and I see nobody talking or writing about it. And it's, they're sneaking up there. You know, they're probably, from having full capability, they're probably three years out, from being able to, you know, side by side stand up against the Dayforce or UKG. But they will be there in a couple of years, they will absolutely be there in a couple of years. And I think that's the best one to watch. The only thing they're truly missing right now. Is a Microsoft payroll solution. Should they buy somebody? Should they build it? I don't know. But that's the only thing that they're missing from a Microsoft branded is really a a payroll solution.

Greg Irwin 42:21

Is anybody going HR, HR with Microsoft today? Any of your clients?

Jacqueline Kuhn 42:27


Greg Irwin 42:29

So they're in the market here. They're just not there. They're just not in the top? Top? Top three or five?

Jacqueline Kuhn 42:35

Exactly. And they're not. They're not marketing. They're not advertising. It's kind of like, they're they're doing, they're doing the old pay finance operations. We have your ERP. And oh, yeah, let's talk to the HR people. Because for no additional price, we can give you this component of HR two, that is fully integrated with all the other stuff you want to do like workforce planning, and blah, blah, blah. So yeah, they're they're doing the old what, what SAP did back in the, in the 80s, right? Hey, ERP, we've got your ERP. And we're going to give you the HR thing. So why wouldn't you do the HR thing? And it's a pretty compelling, you have to have a pretty compelling business case not to take the what they're giving you an HR, because it's pretty much there's no cost.

Greg Irwin 43:32

You think they're going to make a move? I mean, they go and pick up the mid market, payroll, or other solution providers here in the space?

Jacqueline Kuhn 43:42

I think so. It's Microsoft, they're going to do something. Yeah. I don't know who I've been thinking a lot about. Who might? Who might they might they pick up right? Um, you know, who, who's, who's out there doing stuff that maybe a good compliment to them. Lanteria is the one that comes top of mind because they built an HR system on SharePoint, including a payroll solution. You see him mostly in Europe, you don't see him a whole lot in the US. But I'm thinking, you know, maybe they just take Lanteria and what they did on the SharePoint platform and somehow integrate that so more to come. But yeah, I they're, they're probably they have partnerships with Ceridian and ADP today, but I would not do not weed Microsoft out from buying some payroll vendor.

Greg Irwin 44:42

Would it make sense for them to go for one of the mainstream ones like, like a Paylocity, or one of the, you know, you know, one of those more pervasive platforms as opposed to somebody who technically is right there, but obviously lanterra we you and I haven't spoken about Lanteria yet. Have you ever?

Jacqueline Kuhn 45:03

Um, you know, it's a catch 22 if you buy, if you buy somebody with 10s of 1000s of customers, then you've got to, you know, move them to your platform, or you're supporting a full HR suite. Right? So while Microsoft could do that, because they've got more money than God, but um, you know, I don't, I wouldn't think personally that that's a smart business move, you don't buy somebody with 10s of 1000s of customers already. Maybe you buy somebody with four or 5000 customers like your, and there's a whole bunch of like your, your name leads your by, you know, business, HR, those kinds of people, right, they've got a couple of 1000 customers on a platform that has been proven. If it were me, that's the route I would go because it's a lot easier to migrate them to migrate a couple 1000 people off of that. So you're not supporting two platforms than it is to have this entire payroll service bureau you just bought.

Greg Irwin 46:07

Really interesting. Can we talk about benefits? The one, the one area here that I think you and I never spend enough time on is the cost of HR of of health care benefits, cost of health care? So what is high cost of health care benefits? What are your clients doing about it? In other words, where what how are they addressing it? What are the solutions that they're looking to, in terms of systems or processes to help address you know, healthcare costs.

Jacqueline Kuhn 46:45

We're not seeing a whole lot of new system buys, just because of benefits. What we are seeing is, when looking at the full HCM, more customers are open to carving out benefits to a benefit administration provider, such as a benefit, focus, you know, benefit express those kind of folks, because they want that, that decision support that shopping experience that that the method to drive a person to pick a lower a lower cost benefit, right or more appropriate benefits for them along with some other services. So we're not seeing people just go out there buying new benefit systems. We're seeing them though, carve it out. But that being said, as we talk to our customers on what they're doing within the world of benefit, it's more it's offering more voluntary benefits. And I'm looking at the what they're giving as company provided insurances, life, disability, etc. And maybe offering what they didn't in the past in a in an Ltd or an STD or upping the coverage that they might offer. For those things that don't have this higher price tag, but they can give a total overall benefit. I know at a current past, we most recently switched our PEO. And not only do we have a lower total cost of benefit overall to the company, but we've actually been able to offer a 401k match we never could before. We always had a 401k but never a match. So we went out and shopped and found a new PEO that would that is more beneficial to us and to our employees. I know there's other people doing that who are in a PEO situation. I think and I know that our customers are with their benefit brokers right now working on what do we offer for 2022? You know, how does that look? They're looking at revamping their offerings. You know what the pay split employer versus employee, you know, how can they create a robust benefit package but still hold down the cost? And this is the time of year when bene- the benefit teams are working with brokers, because most of that what's going to be offered in 24 2022 pretty much has to be nailed down by August so that you can get that into the open enrollment systems.

Greg Irwin 49:28

By the way, I know I know. We had a number of people who joined mid mid call here. Just a reminder that this is Jacqueline Kuhn. She's Executive Vice President of HR HCM consulting at HRchitect, she knows this market I'd say better than all argue better than anybody. So if people are going through these processes are have specific questions. I'll encourage you to to speak with Jacqueline and her team and see if they have some answers or can offer some some assistance. Jacqueline, I guess the question is for benchmarking, or any of your clients having success, lowering HR benefit, sorry, keep saying HR healthcare benefit costs.

Jacqueline Kuhn 50:11

Not that I know of. I don't know of anyone specifically, aside from us and what we did with our PEO, I really don't know the answer to that.

Greg Irwin 50:23

You know, we have we I have an anecdote as well, we're about 40 employees, we were on Trynet to had a real issue with customer support, and actually just switched, switched over to Justworks. PEO and we got better pricing, and they're promising better support. We'll see how that works. But I do know that there were issues, we were looking around and thinking what can we do on benefit cost? And that we really didn't find many answers at least, or at least ourselves.

Jacqueline Kuhn 50:54

And we, we moved from ADP to insperity.

Greg Irwin 50:59

And why did you come off the ADP PEO?

Jacqueline Kuhn 51:03

It was a combination of service. But we were looking at a better benefit cost and insperity was able to provide a overall better cost and plan offering.

Greg Irwin 51:14

Interesting. We do have that question hanging here. And I'm going to remind people, we're just going to go another couple minutes with Jacqueline. So send in your last question to Jacqueline daily pay daily pay cards and wallet? Are those 14 projects you've got? Roughly? How many of them do you think are going to opt for a daily pay option for their employees?

Jacqueline Kuhn 51:41


Greg Irwin 51:42

Okay, you have to explain, please explain.

Jacqueline Kuhn 51:44

No, yeah, it's really interesting. The the none of our current clients and they're in manufacturing, automotive, pharmaceutical, professional services, and retail, none of them retail like store retail, not that rush, you know, a large store retail, none of them feel that daily pay is needed. Although de force wallet concept is needed. And you know what I called her and wage access, none of them feel that that's necessary. They have not been asked about that by their employees. And you know, there, it's all, we'll wait to see if our employees asked us and then maybe we'll look at it, but it is not driving a decision in any of our deals right now.

Greg Irwin 52:43

How interesting. Is there a cost? So what why isn't it just Sure, why not just throw it in there. And if the employee wants it, they take it?

Jacqueline Kuhn 52:52

It's really not a cost, it's a process. So it really means that the payroll team has to change the processes that they use to cut paychecks. Because obviously, what was given to them that they already work has to be reduced at the end. And so, you know, it is it adds complexity to the payroll teams. And if there's no benefit if the employees aren't looking for it, then yeah, there doesn't seem to be any.

Greg Irwin 53:28

Interesting. So what are I because I keep coming back to recruiting is tough. You have to offer the right package of benefits and offerings to entice people. And maybe it's, you know, things like a remote work capability, but from an HR offering. Are there certain add ons that companies are offering that are that are being used to help entice? Or, you know, satisfy employees?

Jacqueline Kuhn 53:58

Yeah, what what we're, when we talk to the recruiting teams of our clients, the number one, the number one thing that they are hearing from candidates is development opportunities and training capabilities. Right? How will I get developed? Will I will I, you know, learn something from coming to work for you. And work flexibility, but more importantly, what tools Am I given to support that work flexibility? Are you know, if, if I'm working from home, are you going to pay for my internet? Or do I have to pay for it? Are you going to give me a laptop? Are you gonna Are you going to give me the tools? What do you use for instant messaging? Are you using Slack or you know, what do you have? So it's really all about what are you going to give me to help me do my job better? What tools do you have? And how are you going to train me? For my next for my next position, if those are the big things that people are looking for benefits are important, but that's their table stakes now, right you have everybody has to offer a certain level of benefits. And yeah, the cost has to be in line. But that's kind of table stakes at this point because everybody has it. It's these other things that people are now thinking about that that are important to them. And depending on what coast you're on, you know, do you offer communities of interest on uncertain coasts, being able to join communities, whether it be something like an LGBTQ or we are golfers or bowlers? You know, even though I may be working from home, I want to have an affinity group to belong to, and do you have those kinds of things in place? So it's sort of this, this, this more social aspect of work.

Greg Irwin 56:04

Right. Excellent. Hey, Jacqueline. It's always fun to catch up. Let me remind people Jacqueline's joining us from HRchitect, please let us know if we can help connect you. And if she and her team can help address any of the questions you have in terms of putting in the right systems and processes to support your employee base. Thank you all for all the great questions. And Jacqueline, thank you so much for taking the time.

Jacqueline Kuhn 56:31

You're welcome. Thank you all bye now.

Greg Irwin 56:34

All right. Thank you. Thanks, everybody. Take care. Bye bye.

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