The intersection between HR strategy and HR technology

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“Recruiting and retaining talent is the number one challenge for SMBs, and job boards, Excel spreadsheets and Outlook fall short when it comes to competing for superior candidates,” said Jason Blessing, group vice president and general manager, SMB, Taleo. “With this alliance, Taleo and Paychex are empowering SMBs with a compelling and high-value offering that will allow them to better source and retain passive and active candidates and then easily feed all new hire information into the Paychex Preview payroll system.”   ((Taleo Press Release.))

I was a bit surprised to see this, but given that Taleo is so dominant in the large enterprise recruiting space, their only places to grow their market was really in performance (general release earlier this year) and down market. 

On it’s face, Paychex seems like a decent place to start, but I’m honestly a little surprised that they didn’t go with someone like Ceridian instead.  ADP is an obvious elimination since they own Virtual Edge, another recruiting system. 

Paychex is not an intuitive solution for Taleo to partner with since their own technology is far behind Taleo’s.  First, Paychex HR customers often deal with technology that is well behind competitors such as ADP and Ceridian.  Second, There are comparatively few Paychex HR customers compared to Ceridian and ADP.  Most of Paychex customers are pure payroll, although this has been shifting for quite some time.  Lastly, an organization like Paychex which has severely limited penetration into the medium size employer market.

Even then, Paychex is probably the number 2 provider (behind ADP) for the small employer, so if Taleo is looking to increase penetration into 100 and 200 employee companies, perhaps this does make good sense.  Payroll is a very low priced commodity market, and while I don’t know how Taleo is pricing their services, it certainly can’t be similar to the enterprise market. 

One thing I know for sure, the SMB market is in for some interesting competition now that Taleo is in the mix for their business.  As always, more high quality choices just means better news for the rest of us.

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2 responses to “Taleo Goes Down Market”

  1. Jason Blessing Avatar
    Jason Blessing

    Taleo has had an SMB offering since March 2005 and is the market leader in this segment with over 1,200 customers. Our solution, Taleo Business Edition, is a product built from the ground up to serve the unique needs of small and medium sized companies. The centerpiece of the agreement with Paychex is a seamless product integration, allowing companies to onboard employees hired in Business Edition directly into the Paychex HRIS and payroll system, reducing the time, effort, and errors associated with dual data entry. Pricing for Taleo Business Edition starts at $99 / month.

  2. […] Taleo Goes Down Market (Systematic HR) When Taleo partnered with Paychex it was a sign the company was looking to grow in the small-business market. Apr 30, 2008, 9:27 AM […]