ADP: Evolution and Revolution 

For the past decade I have chronicled ADP’s journey from a payroll bureau to a “technology-driven services organization,” offering a modern HCM suite built in the cloud. LIke all real change, it has been a process of both evolution and revolution. This journey has not been merely a shift in product, but truly a shift in mindset. It has been a process of evolving their traditional strengths, and revolutionizing key HCM process.

I have experienced the shift firsthand while attending the past 10 annual analyst days. This year’s gathering took place on September 12-13. The event has evolved drastically from its early days, which were a slog through a 300-page binder full of largely NDA-embargoed information, held in a faded-glory hotel ballroom, with the accompanying sense that presenting to industry analysts was a pale dress rehearsal for presenting to the financial analyst community. It has now become a true day-long conversation with leaders from throughout ADP’s businesses, hosted at its own ultra-modern Manhattan Innovation Center. I have also observed the moves that ADP’s CEO Carlos Rodriguez and his team have made—to divest the company of its non-core businesses, invest in strategic acquisitions, and use its data to claim a spot at the center of the conversation about the changing U.S. workforce. And they have also found time to build some freaking cool stuff! 

Consider the following ADP highlights:

In 2011, Carlos Rodriguez was named President and COO of ADP in May and in December became its CEO. ADP also acquired The Right Thing in that year, bolstering its Total Source PEO (professional employer organization) offerings with leading RPO (recruitment process outsourcing) technology capabilities. Today, Total Source has 562,000 PEO employees, a total that would make it the third largest employer in the U.S.

In 2014, ADP divested its dealer services business line, which helped sharpen the company’s focus on HCM. The organization also cemented its visible commitment to technology innovation with the opening of their New York City-based Innovation Center. Moreover, the addition of an industry analyst relations role helped to solidify ADP’s place as a technology provider and not just a service bureau. 

In 2017, Rodriguez and his leadership team defeated activist-investor Bill Ackman in a proxy fight, and in my opinion emerged with a new commitment to transparency around its innovation and growth plans. The organization also acquired Global Cash Card and The Marcus Buckingham Company, recognizing the strategic value that both technology, as well as data, would play in its continued success. Global Cash Card became the core of ADP’s Wisely product line, which is enabling one of the largest, oldest and highly regarded U.S. payroll brands to innovate the payroll experience for payroll administrators and employees alike. Marcus Buckingham and his intellectual capital have helped ADP embed employee experience tools across its technology suite, and in concert with the ADP Research Institute, continue to enhance ADP’s reputation as a source of accurate, accessible and useful data to both understand and service the evolving global workforce.

In 2018, the pace accelerated with two more acquisitions: Celergo, which expanded ADP’s global footprint, and WorkMarket, focused on contingent labor, which rounded out ADP’s tools and offerings across all worker types—full and part-time employees, PEO, and contingent labor—in the U.S. market. ADP also began work on a new, ground-up,payroll engine, which resulted in 2019 in one of the most dramatic payroll innovations in years: the ability to scan an existing paystub and then reverse-engineer your pay rules and processes. Now, I fully admit to being a payroll geek, but this is indeed something revolutionary.

No matter what the current economic conditions are or what the future might hold, it’s clear that ADP is confident in its ability to leverage its deep data, global footprint, and full suite of HCM capabilities to continued success.