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Ceridian HR/Payroll Software Review

4 stars Average rating: 4 (from 108 votes)

An Independent HCM Software Review and Analysis

Employing 9,500+ people worldwide, Minneapolis, MN-based Ceridian more closely resembles the makings of a conglomerate company rather than an HR software-focused organization; and as such differs markedly from the rest of the HR software vendors covered here at HR Lab. That being said, with annual revenues in excess of $1.49B, the company has achieved significant market penetration and delivers a suite of products that reach 130K+ clients and 25M employees.

As an organization, Ceridian is centered around 5 distinct businesses: Ceridian US, Ceridian Canada, Ceridian UK, Ceridian Stored Value Solutions, and Comdata. Ceridian US is a provider of outsourced business services that focus on human resources, payroll, workforce management and benefits solutions. Ceridian US offers HR and payroll services such as payroll processing, tax services, self-service and workforce management tools. Ceridian Canada is a Markham, Ontario-based human resources solutions provider that focuses on payroll, workforce management, HR information services, recruitment and staffing services, employee assistance programs, and training. Ceridian Canada provides services to 40K+ companies and 3M employees. Ceridian UK is based out of Reading, Berkshire, and is the country's leading provider of HR, payroll services, flexible benefits and employee assistance programs. Ceridian Stored Value Solutions (SVS) offers prepaid and stored value solutions that include retail-issued gift cards; Visa and MasterCard prepaid debit cards; promotional cards; and a robust loyalty platform. This Ceridian solution is a market leader and manages $20B+ for over 500M card products from 40+ countries. Comdata is a leading B2B (business-to-business) provider, issuer, and processor of electronic payment solutions that enable $23B in fleet card, credit card, paycard and virtual card transactions annually.

As can be seen, Ceridian isn't focused on one offering and allocates time among all 5 lines of business, without seemingly giving any one business unit more attention than another. While it may seem counter intuitive then that the company can provide a stellar HR software product, analyst reports and the like have nevertheless doled out praise for the Ceridian HR/Payroll solution. Indeed, according to Nucleus Research's David O'Connell, "Ceridian's solution goes beyond the basic benefits of process automation and improved payroll accuracy, which can be significant". Further, the oft-cited Forrester Wave praises the integration capabilities of the HR software, stating, "Ceridian HR/Payroll Latitude is supplemented by well-integrated Ceridian payroll processing and outsourced benefits administration capabilities".

Still, perhaps the most telling statistics about Ceridian's HR software market perception though, come from other accolades the company has received over the years, including "Payroll Outsourcing Provider of the Year" and a rank of 22nd on the "Global Outsourcing 100". While Ceridian has also received recognition for its customer service, it's quite clear that the HR industry continues to recognize the company as a payroll provider first; and an HR solution later.

From a Back-Office Offering to a Global Powerhouse

The roots of Ceridian as a company came out of the ruling of an IBM antitrust suit in the 1970s—a lawsuit that lead to the acquisition of a then-IBM company called the Service Bureau Corporation (SBC) by Control Data Corporation (a technology services and manufacturing firm). The settlement that created this 1973 acquisition essentially gave Control Data ownership over SBC's payroll, General Ledger (GL), and accounts payable business; a move that would eventually set the stage for a breakaway company designed to only handle those business services aspects.

After corporate restructuring efforts by Control Data in 1992, Ceridian Corporation emerged as provider of outsourced HR/Payroll services with the goal of becoming a full-service global source for HR administration and management solutions. Along the way, Ceridian has made significant infrastructure investments including: the 1993 acquisition of Systems Tax Service (a payroll tax services firm); the 1995 acquisition of Centrefile (the United Kingdom's largest payroll processing outsourcer); the 1995 purchase of Comdata (a transportation/gaming industry transaction processer); the 1998 buy-out of LifeWorks (a massive Employee Assistance Program subsidiary of Work/Family Directions); the 1998 buy-out of Toronto Dominion Bank's and Canadian Imperial Bank of Commerce's payroll outsourcing operations (establishing Ceridian Canada); the 1999 acquisition of ABR Information Services (the United States' largest 3rd-party benefits administration firm); the 2000 phased buy-out of Stored Value Systems (the United States' largest provider of stored value cards); the 2002 acquisitions of GLS Benefits Services, HR Comply, and IBM's Commercial Employee Service Center; the 2004 acquisition of Recruiting Solutions International (a provider of online recruiting/workforce management offerings); the 2004 purchase of Information Technology Systems (an Ireland-based HR software company); the 2006 purchase of Leade Health (a health coaching firm that focuses on weight and stress management, as well as substance cessation and heart health); and finally the 2011 acquisition of Versult (a leading workforce management consulting firm).

Ceridian was acquired by Thomas H. Lee Partners (and Fidelity National Financial) in late 2007 at which point the company ceased the public trading of its common stock. Although due to this acquisition, Ceridian has returned to being a privately held company (and keeping tight reins on much of its organizational data), the firm remains relatively open with its success. In fact, the latest (2010) released figures for the company indicate annual revenues are sitting at $1.49B.

In many ways these revenues are a product of the conglomerate nature of the company, but Ceridian's strategic partnerships have also helped propel the company to its current state of success. Most notably, Ceridian developed working relationships with Workday and SuccessFactors (SFSF) and with at least the latter company had jockeyed to have payroll, time & attendance, and tax filing functionality integrated into the SuccessFactors Employee Central 2.0 offering. Likewise, Workday's relationship with Ceridian was similarly built on the presupposition that Ceridian would be focusing on the administrative "system of record" facet for organizations while talent management was handled by the partner company. Unfortunately for Ceridian, it appears that Workday's strategic plans to become a viable end-to-end solution have thwarted most of the tactical gains that Ceridian achieved with the partnership. As well, SuccessFactors acquisition by SAP created yet another unplanned impediment in Ceridian's plans. While this leaves the company in a bit of a tight spot regarding future revenue drivers, it does not appear to have affected their current offerings—reviewed here in more detail.

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