{"id":491,"date":"2006-07-17T01:00:16","date_gmt":"2006-07-17T09:00:16","guid":{"rendered":"https:\/\/systematichr.com\/?p=491"},"modified":"2006-07-17T01:00:16","modified_gmt":"2006-07-17T09:00:16","slug":"talk-about-hewitt","status":"publish","type":"post","link":"https:\/\/systematichr.com\/?p=491","title":{"rendered":"Talk About Hewitt"},"content":{"rendered":"<p>There&#8217;s been a lot of it lately.\u00a0 Our own <a target=\"_blank\" href=\"https:\/\/systematichr.com\/?author=5\">Donald Glade<\/a> wrote about it <a target=\"_blank\" href=\"https:\/\/systematichr.com\/?p=482\">here<\/a>, and Jason did <a target=\"_blank\" href=\"http:\/\/humancapitalist.com\/?p=167\">here<\/a>.<\/p>\n<p>First off, my response to Jason Corsello:\u00a0 ADP should not buy Hewitt.<\/p>\n<ul>\n<li>ADP does not have a proven track record integrating acquisitions into their business model.\u00a0 They acquire and then try to turn every acquisition into an ADP.\u00a0 It doesn&#8217;t work when the services you provide are so dependent on the people doing the work.<\/li>\n<li>ADP does not understand the large employer market (defined as the Fortune 1000).\u00a0 While they may be able to scale services for HR, payroll and benefits up to 50K employee and maybe even more, their business model of highly transactional, repeatable services has not combined well with the consultative services that are required for a good business partnership.<\/li>\n<li>Hewitt has lost too much of their consulting talent.\u00a0 What made them valuable once no longer exists.<\/li>\n<li>Hewitt isn&#8217;t a profitable enterprise.\u00a0 And the collary to that:\u00a0 ADP is all about profits.\u00a0 Except for the ProBusiness acquisition a few years ago, ADP doesn&#8217;t generally acquire a business knowing they are going to have to turn it around.<\/li>\n<li>ADP doesn&#8217;t know enough about HRO to turn the business around.\u00a0 In fact, it&#8217;s possible nobody knows enough about HRO to really turn Hewitt around.<\/li>\n<\/ul>\n<p>Donald:<\/p>\n<p>The implications for the HRO market will be interesting to watch.\u00a0 First off, Hewitt&#8217;s pipeline is undoubtedly suffering and they will have to work hard to win sales.\u00a0 Not only is their balance sheet and turnover going to cost them sales, but as the mood in the organization worsens and sales suffer, they will probably have an exodus of their best salespeople.<\/p>\n<p>Second, we&#8217;ll probably see the HRO buyers giving the HRO vendors a bit more grief about their cost model.\u00a0 While buyers will be driving for lower costs, they&#8217;ll have it in the back of their minds whether the vendor can provide quality services, make money and deliver a mutually agreeable pricing contract all at the same time.\u00a0 Never has this been more of a concern.\u00a0 If Hewitt can have these issues, any of the other vendors can as well.<\/p>\n<p>There&#8217;s been a lot of speculation that Hewitt might spin off the HRO portion of it&#8217;s business.\u00a0 I simply can&#8217;t see that happening since the consulting side of the business has also been significantly weakened due to their focus on HRO.<\/p>\n<p>In the end, I&#8217;ll agree with your (Donald Glade&#8217;s) analysis.<\/p>\n<blockquote><p>In the final analysis, we may very well see that the Hewitt-Exult merger did indeed change the way the market views <acronym title=\"Human Resource Outsourcing\">HRO<\/acronym>, but not in the way in which people may have thought only one year ago.<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"<p>There&#8217;s been a lot of it lately.\u00a0 Our own Donald Glade wrote about it here, and Jason did here. First off, my response to Jason Corsello:\u00a0 ADP should not buy Hewitt. ADP does not have a proven track record integrating&#8230;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","footnotes":""},"categories":[6,3],"tags":[],"class_list":["post-491","post","type-post","status-publish","format-standard","hentry","category-hewitt","category-vendors"],"_links":{"self":[{"href":"https:\/\/systematichr.com\/index.php?rest_route=\/wp\/v2\/posts\/491","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/systematichr.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/systematichr.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/systematichr.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/systematichr.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=491"}],"version-history":[{"count":0,"href":"https:\/\/systematichr.com\/index.php?rest_route=\/wp\/v2\/posts\/491\/revisions"}],"wp:attachment":[{"href":"https:\/\/systematichr.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=491"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/systematichr.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=491"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/systematichr.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=491"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}