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RESEARCH NOTEPROGRAM: HUMAN CAPITAL MANAGEMENTDOCUMENT NUMBER: S127 AUGUST 2018HCM VALUE MAT RIX2018ANALYSTSRebecca Wettemann and Trevor WhiteTHE BOTTOM LINEWith the rising cost and complexity of managing one of the four pillars of every organization– its people – human capital management (HCM) vendors are accelerating their delivery ofinnovation, with cloud being a main driver. Leaders have set themselves apart by focusingon functionality that moves beyond reporting to embedded prescriptive analytics andartificial intelligence (AI), while rounding out their suites with additions of successionplanning, talent management, collaboration, and advanced compliance capabilities. Criticalnext steps for leaders are integrated collaboration across the suite, and real-time access todata for decision making from recruiting and onboarding to retention and separation. 2018 Nucleus Research Inc. 100 State Street, Boston, MA, 02109 1 (617) 720-2000 NucleusResearch.com1

OVERVIEWWith leading HCM vendors delivering new capabilities several times a year, the competitivelandscape continues to shift quickly. Part of Nucleus’s four pillar of an organization,“people” controls one of the largest shares of budget. Payroll, talent retention, succession,and workforce management have a major impact on the bottom line today.Leaders have set themselves apart by aggressively innovating in functionality aroundanalytics and AI, real time prescriptive and predictive recommendations, and broad usabilityand accessibility. Major functional modules have now become table stakes, with leadingvendors differentiating among themselves by providing integration collaboration andmessaging.Nucleus’s analysis of trends among users shows that cloud-based technology will be thecenterpiece of HCM, moving forward. Nucleus’s analysis of users’ experiences this past yearshows that increasingly, organizations are turning to single suite applications as cross marketintegration becomes a greater business driver. Organizations need to be able to share anduse data in real time across departments, which remains much easier to do on a single suite.Best-of-breed applications, particularly those vendors that do not have turnkey integrationwith larger solutions, will find it harder to stay in business.More than 60 percent of customers are in the cloud. Nucleus found that those not in thecloud are either looking to move or are limited to on-premise solutions because of externalfactors such as unions. As a result, the majority of employers that still make do with onpremise solutions have very few options to stay there. Because of this, more than 80 percentof the on-premise customers that Nucleus interviewed are actively considering moving soonto the cloud. These realities explain related findings on planned spending in HCM. The datafrom this survey show all but a small handful of cloud-based users expect to increasespending per capita, per year, over the course of the next 12 months.As human capital management (HCM) vendors and decision makers have accelerated theirmove to the cloud, vendors have focused on technological features, not value drivers. Thedebate around the cloud should be about the ability to deliver faster time to value andgreater benefit over time with limited cost and disruption to end users. Nucleus hasidentified three key areas customers should consider: initial deployment and time to value,usability and accessibility, and the pace and impact of upgrades. Vendors that are able toshow value in these three areas will dominate the market as on-premise deployments cometo an end.Embedded analytics and artificial intelligence (AI) are also becoming a must have for leadingvendors. End users expect completely integrated analytics that is not only predictive, butprescriptive. The main analytics track in HCM is currently around employee flight risk andturnover prevention, but is also expanding into areas like schedule optimization andsuccession planning. Analytics solutions can only be of value to end users if the data iscontinuously uploaded and available into a single offering.Document Number: s127 August 2018NucleusResearch.com2

Document Number: s127 August 2018NucleusResearch.com3

LEADERSLeaders in the Matrix include Ceridian, Infor, Oracle, SAP SuccessFactors, SumTotalSystems, and Ultimate Software.CERIDIANCeridian built Dayforce from its origins in payroll and the rest of workforce management(WFM) into a full-breadth, full-fledged solution for HCM with functionality that now spans allof core HR, WFM, recruiting, onboarding, performance management, and compensationplanning. Ceridian’s large pool of HCM data means that the vendor is able to leverage itsknowledge to aid in everything from initial deployment to predictive employee successionplanning. Ceridian’s single rules engine governs a single application which produces asingle dataset. This architecture makes the definition of real-time processing of informationpossible. This architecture has set Dayforce apart from the competition and supports realtime reporting.Ceridian launched the Dayforce Software Partner Program (DSPP) last year to create asoftware partner ecosystem aimed at helping organizations easily connect other HCMrelated solutions with Dayforce. The DSPP gives Ceridian software partners and applicationdevelopers access to Ceridian’s APIs, making data available across Dayforce and partnersolutions. The following is a rundown of new functionality relevant to this report: Contiguous and regular upgrades have now become a part of Ceridian’s standardupgrade schedule. In addition to the twice-yearly major updates, Ceridian isproviding smaller updates every six weeks. These updates go beyond fixing standardbugs and errors, to focus on adding incremental value to the end user’s needs(Nucleus Research s117 – Ceridian HCM Cloud Value Drivers, July 2018). Ceridian is developing a voice-activated personal assistant that, using advancedanalytics, will have the ability to recommend specific actions or transactions basedon collective data and the experiences of others in similar situations. The assistant,which will work with smart speakers such as Amazon Alexa, Google Home, andMicrosoft Cortana, will enable managers, workers, and administrators to completetasks across all areas of HCM. In December, Ceridian announced an alliance that will seamlessly connect Ceridian’sDayforce with Microsoft Dynamics 365.Through this collaboration, Ceridian willprovide Dayforce payroll solution to Dynamics 365 customers in a single productoffering. Backed, supported and productized by Microsoft, this deep datatechnology integration will enable Dynamics 365 customers to leverage all thefeatures of Dayforce Payroll without the need for them to build or manage theintegrations themselves.Document Number: s127 August 2018NucleusResearch.com4

Optimized Recruiting, integrated with Indeed. This was a complete redesign of theDayforce recruiting solution that focused on making the recruiter more productive byfocusing on things like rules-based resume scoring. the spring, the vendor released a native UK payroll solution and also enhanced itstalent management capabilities with the release of compensation and learningmanagement modules In June, Ceridian rolled out enhanced predictive analytics capabilities that analyzekey factors linked to flight risk.INFORGlobal Human Resources is Infor’s core HR solution for organizational planning, personnelsystem of record for employees and non-employees, benefits enrollment and life events, fullabsence management capabilities for plan definition and administration and a foundationalset of self service capabilities delivered on any type of device. The solution also has newhire onboarding, offboarding, employee rewards management, employee relations,occupational health and employee safety. Tightly coupled with Global Human Resources(GHR) is a full Talent Management suite of applications built upon a framework that includesindustry specific content models as desired. This suite includes talent acquisition,compensation management, goal-setting, learning management, and advanced pre-hiringassessment. As with the other major players, Infor offers mobile functionality for iOS andAndroid OS. Infor continues to migrate its on- premise legacy customers to the cloud.Infor’s Workforce Management (WFM) solution covers labor cost controls, enhancedoperating efficiencies and agility, time and attendance, scheduling, absence managementand task management and also includes an industry specialization for Healthcarescheduling. A COBOL-based, SaaS-delivered solution handles payroll and facilitatesregulatory reporting, compliance with employee law, and the processing of payroll taxes.Other global regional packs deliver localized payroll capabilities. Infor offers crossfunctionality with the vendor’s financial management solution for WFM and HCM. Thevendor competes with other vendors that offer enterprise resource planning (ERP) solutions,including Workday, Oracle, and SAP. For onboarding, Infor continues to differentiate itselfby drawing on the vendor’s suite and technology. This enables Infor to complementonboarding with unconventional ideas. For instance, the system can determine the retailerswhose products might appeal to a new hire and then send him or her a related couponahead of his or her first day on the job. The following is a rundown of new functionalityrelevant to this report: Infor announced new tools for Infor CloudSuites for Healthcare that enableshealthcare providers to recruit and maintain the best fit clinical and non-clinicalteams.Document Number: s127 August 2018NucleusResearch.com5

Infor announced Infor CloudSuite HCM Analytics, a new healthcare analytics solutiondesigned to optimize workforce and operational effectiveness along with industryspecific content for predictive analytics. Infor combed two of its newest products, Infor Coleman, an artificial intelligencesolution designed specifically for business users, and Infor Talent Science, apredictive behavioral analytics tool, to create Infor Team Dynamics. Infor TeamDynamics will extend the ability of Infor Talent Science to predict high potentialtalent based on not only their fit to the role, but also their fit to their new team andmanager. Infor announced the incorporation of Infor Coleman, into the company's TalentScience solutions. Coleman, a pervasive platform that operates below anapplication's surface, mines data and uses powerful machine learning to improveprocesses such as inventory management, transportation routing, and predictivemaintenance, and now human capital management. The application will bedeployed within Infor Talent Science in the areas of role-based profiledevelopment.ORACLEOracle provides a full suite of HCM solutions natively built on one platform. The suiteencompasses depth of HCM, including core HR, payroll, time and attendance, recruitingand onboarding, as well as talent management and Workforce Management. While Oraclecontinues to provide updates to the formerly named Taleo solutions for customers still onthat platform, Oracle’s sales strategy is to sell the entire HCM Cloud suite to new customers.The majority of net new customers comes from both large and mid-market sized companies.In addition, Oracle has launched a new program, Oracle Soar, to move its legacy onpremise customers to the Oracle HCM Cloud.Oracle's Cloud Time and Labor product has matured significantly in the past year, leavinglabor forecasting and optimized scheduling as the only major gap that remains. To addressthis, Oracle partners with best of breed vendors for each industry that requires this kind ofadvanced scheduling capability. Oracle has a very public partnership with Kronos for timeand attendance. For Retail and Hospitality, Oracle partners with WorkForce Software and isin process of securing partnerships with vendors who specialize in other industries such ashealthcare and government emergency services. For Field Services and ProjectManagement, Oracle Field Service Cloud also offers an advanced Shift Planning solutionand Oracle Project Resource Management Cloud can be used to optimize resources toprojects while leveraging worker data maintained by Oracle HCM Cloud and using webservices to import schedules from those modules into Oracle HCM Cloud.Key improvements in functionality in the past year include the following: In June, Oracle launched a free digital learning platform designed to help customersquickly and easily take advantage of the continuous innovation within Oracle CloudApplications. This is called Oracle Launch Pad. The platform providesDocument Number: s127 August 2018NucleusResearch.com6

comprehensive learning paths and task-focused modules with video tutorials andstep-by-step instructions. The company is enabling its ERP Cloud and HCM Cloud interfaces to support voiceservices such as Amazon Alexa. Oracle HCM Cloud mobile apps and chatbots alsoprovide support for voice input and (device dependent) output/readback. New customer support offerings are designed to help customers get more valuefrom Oracle Cloud Applications including HCM Cloud, ERP Cloud, EPM Cloud,Supply Chain Cloud, Manufacturing Cloud and CX Cloud. Offerings includeimproved SLAs, 24/7 rapid response technical support, dedicated implementationsupport, proactive technical monitoring, success planning and adoption guidance,business process monitoring and guidance, Customer Success Portal, and a newdigital experience platform for on-demand education resources. Oracle announced a strategic partner with IBM to provide Business ProcessOutsourcing for Human Resources delivered on the Oracle HCM Cloud platform.Together, IBM and Oracle will enable organizations to seamlessly migrate toOracle’s HCM Cloud platform.SAP SUCCESSFACTORSSAP SuccessFactors payroll and time and attendance functionality are still trailing behind theleading vendors in the HCM space. The vendor has committed to making improvements inthis space however. SuccessFactors highlights include SAP Jam, which enhances employeecollaboration by being the social media platform for SuccessFactors. SuccessFactorsPerformance & Goals also offers trigger-based performance management, which enablesemployees and managers to request achievement feedback at any time and enablesmanagers to track metrics. The SAP SuccessFactors Mobile iOS app enables users to accesstime sheets, time-off requests and approvals, search, organization chats, performancemanagement, and reviews. Ongoing improvements to the existing Android OS app arebeing made to enable it to match this functionality.Recent SAP announcements include: The launch of candidate relationship management capabilities as part of its SAPSuccessFactors Recruiting solution. Now with embedded candidate relationshipmanagement capabilities, recruiters can more efficiently manage the application andhiring process. Recruiters can manage candidate engagement end to end on a selfservice basis across a multitude of channels. Announced SAP SuccessFactors Visa and Permits Management, a new solutiondesigned to simplify the sourcing international talent. New and updated features to the SAP SuccessFactors HCM Suite around GeneralData Protection Regulation (GDPR) rules.Document Number: s127 August 2018NucleusResearch.com7

Upgrade2Success, a program that helps customers with on-premise SAP ERP HumanCapital Management (HCM) solutions transition and expand into the cloud. Announced the planned release of its new job analyzer functionality embeddedwithin the SAP SuccessFactors Recruiting Management solution to help organizationscraft effective, competitive job descriptions and eliminate unconscious bias inrecruiting.SUMTOTALSumTotal Systems (part of Skillsoft) is one of the few HCM platform vendors that offers thefull breadth of HCM solutions. SumTotal incorporates all key HCM components – Core HR,Talent Acquisition, Learning Management, Talent Management, Payroll and WorkforceManagement. SumTotal continuously invests in platform innovation leading to strongusability and functionality. The platform integration also allows for the unification ofdisjointed business processes such as the validation of certifications and training obtained inLearning Management when scheduling employees in Workforce Management. Employeesthat do not have the required training for the job they are being scheduled for are clearlyidentified to supervisors as part of the scheduling process, thus mitigating compliance riskand possible workplace accidents. SumTotal’s Learning Management is the first to fullyenable content aggregation across xAPI, CMI5, third party and custom content as well asunified access to Skillsoft’s large corporate library. SumTotal integrates Skillsoft’s multimodal content, enabling organizations to develop talent through an employee lifecycle.In addition, SumTotal offers three deployment types - SaaS-delivered via multi-tenant cloud,privately hosted in SumTotal, or on-premise, but customers always have the option of thelatest version, regardless of deployment type. This allows for mixed deployments within thesame organization, allowing for companies to account for specific union or regulatory drivendeployment requirements while allowing other areas to take benefit of the cloud.In the past year, SumTotal has announced: A Netflix style design with a personalized experience covering a user’s learning anddevelopment requirements. Streamlining the recruitment and talent development processes for an overall easieruser experience An augmented Core Platform architecture with new and enhanced capabilities forGDPR, accessibility and mobile. The update also included upgrades to employeeengagement, gamification, social, reporting and search performance. New Gamification and Social enhancements leverage data and analytics within theSumTotal platform to drive employee engagementDocument Number: s127 August 2018NucleusResearch.com8

Easy resume upload and AI matching to open positions are a part of the new TalentAcquisition functionality, while improvements to onboarding help new hires matchwith the appropriate mentors and map out their career paths.ULTIMATE SOFTWAREUltimate Software’s UltiPro is a full-suite cloud based HCM solution. UltiPro covers core HR,payroll, benefits management, the remaining breadth of WFM, recruiting, onboarding,career and succession planning, performance management, learning, compensationmanagement and salary planning. Included in core HR are advanced reporting capabilities,predictive analytics, and a meta data-driven configuration platform and rules engine.Ultimate continues to offer strong solutions for complex payroll, predictive analytics,recruiting, onboarding, and analytics. Ultimate users are able to use predictive analytics forboth retention and performance, helping to lower turnover and increase productivity.Ultimate also offers prescriptive analytics via Leadership Actions and UltiPro Perceptionleveraging AI and machine learning to recommend specific actions for managers torecognize, engage, and develop the potential of their employees. In the past year, thecompany has made the following announcements: In July, Ultimate entered into a binding Letter of Intent (LOI) with respect to theacquisition of PeopleDoc by Ultimate Software. PeopleDoc is based in Paris, France,and has more than 1,000 customers with users in 180 countries. The addition of thePeopleDoc HR Service Delivery platform will offer new, person-centric features, suchas an online employee help center and knowledgebase, HR case management, andemployee file management. The vendor also launched Xander. Xander is an AI foundation that leverages NaturalLanguage Processing (NLP) and advanced machine learning technology. Xander iscapable of understanding structured and unstructured data and sentiment fromopen-ended text feedback and recognize over 100 different emotions and detect140 workplace themes. Xander is embedded in UltiPro and the engine drivingUltiPro Perception, Ultimate's employee engagement platform, which includes adynamic feedback solution, sentiment analysis, and recommendations. Throughthese solutions, Xander continuously learns and ‘gets smarter’ over time, constantlytesting the relevancy and effectiveness of its predictions and suggestions. Thevendor also announced the stand- alone availability of Perception by Ultimate. The vendor also launched UltiPro Connect, Ultimate’s centralized integration hubdesigned to simplify and standardize integrations. Customers can access the UltiProConnect marketplace to browse partner apps and services, and can also use UltiProConnect to build integrations without having to start from scratch. In 2018, Ultimate extended options for customers with the most complex benefitneeds with a premium offering, UltiPro Benefits Prime. In addition to handlingeverything related to dependent eligibility, enrollment, and administration, UltiProDocument Number: s127 August 2018NucleusResearch.com9

Benefits Prime offers a consumer shopping experience for enrollees, includingembedded decision support (i.e., education tools - video, plan comparisons, andguided recommendations). It also provides tools such as EOI management andautomation of benefits billing and reconciliation. UltiPro Perception introduced a new partnership with Mercer-Sirota. UltiProPerception users now have access to Mercer-Sirota’s established surveys, questionbanks, and global benchmarks, all embedded within the UltiPro Perception solution. UltiPro’s Community Broadcast solution serves as a communication hub thatempowers customers to control message flow, connect leaders with their teams viatext or email, without having to leave UltiPro. Administrators can target certaingroups and request acknowledgement to ensure that employees received theinformation, with the exchange tracked within UltiPro. Ultimate announced Prescriptive Leadership Actions, added in UltiPro reinforcepractices by managers who are guided to recognize, engage, and develop thepotential of the individual.FACILITATORSFacilitators in the Matrix include Paycom, PeopleStrategy, Ramco Systems and Workday.PAYCOMPaycom’s history is characterized by its expansion to provide functionality for WFM andHCM. Its features include payroll, time and attendance, payroll processing, benefitscompliance, sourcing through onboarding for talent acquisition, performance management,compensation, planning, and learning. Because Paycom runs in a public cloud on a singleapplication with a single database, the solution has the ability to process data in a real timemanner. This greatly benefits large employers and their efforts to comply with employmentlaw.Paycom’s analytics are noteworthy for their focus on employment law and compliance,especially with the ACA and FLSA. The solution is also noteworthy for its ability to allowemployers to pre-screen candidates for tax credit-eligibility and secure them to help lowercosts.Although Paycom users have reported functionality and reporting limitations, ease of use,frequent automatic updates, and competitive pricing are positives of the solution. Thevendor has recently expanded in size, with Paycom hiring for over 100 corporate positions,and announcing the opening of new offices in San Diego and Columbus Ohio.Document Number: s127 August 2018NucleusResearch.com10

PEOPLE STRATEGYPeopleStrategy provides a Cloud-based suite, eHCM, that provides a single end-to-endHCM solution specifically tailored to small and medium sized employers. eHCM’scapabilities includes a full service payroll module, benefits administration, time andattendance (with scheduling), talent acquisition, and performance management features.This solution also includes web based mobile functionality, a reporting module withconfigurable dashboards and data visualization capabilities, and the ability to comparehealth plans side by side within its benefits administration module.PeopleStrategy’s solution differentiates itself with its focus on companies with 100 to 3,500employees. eHCM does not require upgrades and fees when enhanced functionalitybecomes available. People Strategy’s implementation program provides end users withconstant communication when implementing eHCM and enables users to only deploy thefeatures that they need. In 2018, PeopleStrategy announced a number of advances toeHCM such as: PeopleStrategy announced NavBar, a customizable navigation bar that provides asingle access point to all information and tasks pertaining to an employee The vendor has streamlined compensation features together with the ability toreview, edit, and approve payroll The vendor also enhanced tax functionality that recommends state and local taxenrollments for work and home addresses PeopleStrategy now provides interactive training content, such as pop up referencesand videosRAMCO SYSTEMSRamco Systems offers a multi-tenant cloud and mobile-based enterprise software in HCMand Global Payroll, ERP, and M&E MRO for Aviation. The company targets specific verticalsincluding asset-centric organizations like aviation, logistics, equipment rentals; product &process-centric manufacturing; and people-centric staffing & professional services industries.Ramco's payroll platform is configured to support around 45 countries and has partnershipsto cover over 108 countries globally. Ramco provides the same product on-premise, oncloud, and as a hybrid option. The vendor also offers both public and private cloud option.In addition to cloud HCM solution, Ramco also offers managed HR services which includepayroll, HR administration, employee helpdesks, and statutory lodgement services. Ramco'sHCM solution includes modules and features to support the full employee lifecycle includingCore HR, recruiting, talent management, benefits, time and attendance, compensation, andsuccession planning. The vendor also offers reporting and analytics across the variousmodule of the HCM suite. Ramco offers both employee and manager self-service, coveringDocument Number: s127 August 2018NucleusResearch.com11

core HR as well as performance management. Ramco offers ESS/MSS services in simplifiedChinese, Vietnamese, Thai, Bahasa Indonesia, and Japanese languages, in addition toEnglish, French, Spanish, and Arabic. The company also offers a hybrid mobile applicationaccessible on Android, iOS, and Windows, and offers functionality for employee info, leave,expenses, time management, travel management, recruitment, and payroll.With both EAM and ERP, the vendor is a theoretical competitor to Infor, Oracle, and SAP indeals where prospects want an enterprise-spanning suite. Ramco presents itself as acompetitor to Workday, with core HR and integration with the general ledger. While thebulk of Ramco customers are internationally based, the vendor is planning on expandinginto the U.S. and U.K. markets with fully compliant native payroll. This, combined with itslarge international offerings, means Ramco is on track to become a full-throated, end-to-endoption in HCM for global employers in the next few years.WORKDAYWorkday delivers financial management, human capital management, and analyticsapplications. Associated products include: Learning, Payroll, Planning, Recruiting, TimeTracking, Benefits Administration, Talent Management, Absence Management,Compensation, and Succession Planning. Highlights include: Learning. Workday’s learning functionality leverages the industry leading triggerbased model. This application enables employees to create, share, and consumecontent through browsers or mobile devices and has the ability to recommendcontent based on preferences and interests, peer popularity, and Workdaytransactions. Employers can require blended learning, instructor-led training, orexternal content at specific intervals, with reporting enabling them to understand theimpact of their learning programs on key HCM measures. ERP financials integration. Workday Planning for budgeting and forecasting aims tounify financial and workforce planning through HCM and financial managementcollaboration.Similar to competitors such as SAP SuccessFactors, Workday faces the challenge ofenhancing payroll and time and attendance functionality. Nucleus does not recommendWorkday for employers that need great time and attendance functionality, but this can besomewhat mitigated by partnerships. In the past year, Workday announced: Workday announced the acquisition of Adaptive Insights to create imbeddedanalytics in suite of applications for finance and HR. Since January, Workday has alsoacquired SkipFlag, Rallyteam and Stories.bi. Workday now partners with Duo Security, a cybersecurity company that specializes intrusted access and multi-factor authentication (MFA) technologies. As part of thepartnership, Workday will enable customers to leverage Duo’s MFA functionalitywithin Workday’s user interface.Document Number: s127 August 2018NucleusResearch.com12

Workday launched extended capabilities and tools delivered through Workday’shome page for Workday Human Capital Management (HCM), allowing employeesself-service across Workday applications and third-party systems without needing toaccess an HR portal, log a service ticket, or call someone for support. Workday now offers Workday Data-as-a-Service (DaaS), a cloud service that providesvaluable data to customers to enable more informed decision-making.CORE PROVIDERSCore Providers in the Matrix include Ascentis, Kronos, Paycor, and SyncHR.ASCENTISAscentis is a cloud-based solution that spans core HR, payroll time and attendance,reporting, talent management, and talent acquisition. There is support for 360-degreeassessments for reporting, and dashboards are available to conduct analysis. The majority ofthis solution is accessible both conventionally and through its mobile UI. The solutionenhances productivity by automating compliance tasks, such as the fi

Ceridian built Dayforce from its origins in payroll and the rest of workforce management (WFM) into a full-breadth, full-fledged solution for HCM with functionality that now spans all of core HR, WFM, recruiting