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Ceridian Pricing and Company Viability

Ceridian Software Pricing

Pricing for Ceridian's HR/Payroll software varies according to customer requirements and the vendor declined to provide those pricing specifics. As is the case for some HR software solutions, pricing is a negotiated based on client "needs"—a process that is both opaque and designed for sales person gamesmanship. However, the cost model that was disclosed indicated that software pricing was based off of "per module" and "per employee/pay period" distinctions. Deployment models also vary from "un-hosted" to "hosted" and "single-tenant" to "multi-tenant" which materially affect both the short and long-term Total Cost of Ownership (TCO).

Ceridian Viability Review

Since late 2007, Ceridian's ownership has rested with Thomas H. Lee Partners (THLP), a Boston-based private equity firm that focuses on the industries of: Business & Financial Services, Consumer & Healthcare, and Media & Information Service. As one of the oldest and most successful private equity firms, Thomas H. Lee Partners has raised approximately $22 billion of equity capital and invested in more than 100 businesses with an aggregate purchase price of more than $150 billion. While certainly well-heeled enough to simply buy-out a company to drain assets, THLP's focus (and consequent strength) is on identifying and obtaining substantial ownership positions in large growth-oriented companies where the firm's managerial and strategic expertise can be leveraged to create incremental value.

Though achieved in a more roundabout way with Ceridian, THLP's "intervention by acquisition" may well turn out to have been Ceridian's saving grace as the market continues its shift towards the SaaS model. More to the point, prior to the acquisition Ceridian was suffering from a client base that had aging technology which was largely deployed on-premise. Innovation was stagnating, and investment in system re-builds would have proven to be so disruptive that the company adopted a "wait-and-see" approach to more fully understand the changes that the market was experiencing. THLP's ownership, and consequent removal of Ceridian from public trading, made it possible to conduct the business that needed to be conducted—to focus on aligning (and investing) technology with customer needs without the ever-watchful and inpatient Wall Street eye upon them.

This respite of sorts created by the THLP buy-out allowed for the creation of web-based solutions, and gained the company a much-needed foothold in HR's future direction. Unfortunately, a 2009 data breach (discussed in more detail in the "Security" section) took the company backwards in terms of brand strength and caused doubts to be shed on Ceridian's ability to handle data security. The end results of this breach are fully yet to be seen, although a final ruling was made by the FTC this past summer. Regardless of this ruling though, data security is simply table stakes in the new SaaS HR environment, and any questions that arise about a company's ability to handle this critical operational aspect can be a death-knell if not handled properly. It is quite simply a Public Relations nightmare. Yet, in a rather cruel and ironic twist though, the public's perception of Ceridian's security may be negatively skewed at the exact time that measures are in place to make it one of the most secure systems in the HR software market place.

If these issues weren't enough already, Ceridian had been rightfully focused on security and not innovation. As seen by the partnerships that Ceridian forged with SuccessFactors and Workday, Ceridian allowed innovation to slow in the HRMS space and coast off of previous "system of record" wins—seemingly in belief that the market would continue to support best-of-breed solutions in perpetuity. Whereas other HRMS software solutions were shoring up their offerings in the talent management space, Ceridian turned product focus to workforce management; a move that (given SuccessFactors and Workday's directions) may well have been short-sighted.

While up against some pretty rough obstacles, unlike the bulk of Ceridian's competition, Ceridian has a sizeable base of Outsourcing customers and an increased market movement towards "core HRMS" outsourcing. With fewer large competitors in the Outsourcing space, Ceridian could still make a large impact outside of the HRMS software space. Of course an altogether different but plausible alternative is that Ceridian's size will cause it to get swept in the next wave of mergers and acquisitions. Some credence was given to a possible Lawson buy-out some time ago, but today the market is wide open.

Next - Ceridian HR/Payroll Software Strengths & Weaknesses >>

Ceridian HR/Payroll ReviewCeridian Latitude ReviewCeridian HR Software CapabilitiesCeridian Technology ReviewCeridian SaaS HostingCeridian Software PricingCeridian Strengths & WeaknessesCeridian Best Fit & Competitors



Ceridian Review



Ceridian HR/Payroll Software Review



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