NorthgateArinso Coins “BPaaS” to Position Its Solutions

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I know you will forgive me a literary allusion, as I was struck by a thought in NorthgateArinso’s well-organized analyst briefing in Boston last week.  The allusion is to Pirandello’s play “Six Characters in Search of an Author” – a play in which the characters are seeking a playwright to create a theme to bind them together.  

And why, you may well ask?  NorthgateArinso ties together three rather distinct solution areas:   global HR/payroll technology, HR outsourcing (HRO), and HR consulting with the goal, according to Mike Ettling, the CEO, of being a $1 billion company  by 2014.  But like Pirandello’s six characters – the question is what connects  the disparate divisions together into a compelling market force?

The company, owned by Kohlberg Kravis Roberts, has grown by acquisition – Arinso was acquired in 2007, and Convergys in 2010, among a history of many other acquisitions. Northgate + Arinso + Convergys appear to define the three primary business thrusts – and like three actors on a stage, needed a common theme to bind them together.

The answer is original.  “BPaaS.”  The go-to-market theme for the company today is Business Process as a Service, joining a host of other “as a service” offerings on the market currently.  The company seeks to create a customer-resonating message through the combination of its euHReka HR platform, the ability to totally outsource a global HR and payroll operation, and its extensive HR consulting practice.  NGA describes its customer solution as  “hardware + software + functional tower services + back room support + employee support.”
 
Backstage, NGA appears to have the necessary support for the new BPaaS strategy: the company has 8,500 employees are dedicated to HR consulting, HR outsourcing and HR technology.  2000 of those are dedicated to SAP HCM, making it the largest SAP HCP consultancy practice globally; now many of these are now expanding their portfolios in include SuccessFactors as well.

Partnership Growth

It is the relationship between NorthgateArinso  (NGA) and  SAP that has most closely defined its position until just recently in the U.S..(the companies seemed to be “going steady” in a relationship  through which NGA has “wrapped” a SaaS version of euHReka  in concert with a BPO subscription agreement around SAP’s wholly on-premise HR platform.) NGA has been an SAP systems integration partner since 2005.

And while that relationship continues, NGA is now playing the field, dating other industry heavyweights such as Workday, Oracle, and SuccessFactors. For Workday HRIS customers, NGA is a channel partner that provides multi-country payroll, servicing companies that need a wider payroll scope than Workday’s indigenous support for US, Canadian, and UK payrolls.  NGA has a BPO subscription agreement in place for Oracle’s PeopleSoft  and a professional services agreement with SuccessFactors, extending SAP’s HCM capabilities to cover SuccessFactors’ Employee Central and  talent management modules, leveraging its five year history of SaaS integration with euHReka OnDemand.

NGA has offices in 35 countries on five continents, supporting a total of 8 1/2 million users in more than 100 countries. 40% of the UK working population are paid by NorthgateArinso’s solutions, totaling 54 million payslips produced per annum servicing 19 million UK workers .

Company-Reported Customer Figures

1,000 multinational enterprise customers
2,700 large and medium enterprise customers
7,000 small and medium customers
Over 20% of FORTUNE Global 500 companies serviced
Over 20 million employees administered worldwide
Over 2 million employees serviced through HR Outsourcing
Over 800 ERP-based HR implementations globally
Over 6 million employees serviced through HR ERP implementations

Case in Point

In one of the largest HRO deals on the record, NGA services AstraZeneca, a global biopharmaceutical company,  in  a project encompassing 60,000 employees speaking more than 30 languages in 110 countries.  The project now live in 97 countries, is due to finish in October of 2012 – all on a single SaaS platform.

Christa Degnan Manning

Christa Degnan Manning leads Bersin by Deloitte’s solution provider research. In this role, she collaborates with Bersin and Deloitte colleagues across practices to identify and analyze software and service providers that support and sustain success in human resources, workforce enablement, and organizational effectiveness. Christa’s research and advisory work helps businesses align their workforce support strategies with the right third-party partners and governance models to deliver functional capabilities and employee experiences that support productivity, engagement, and workforce efficiency. She also helps solution providers map their capabilities and go-to-market activities with solution buyers’ and users’ critical needs. Christa draws on more than two decades of business-to-business market research, operational leadership, and global workforce experience. She holds a Master's degree from the University of Massachusetts, and a Bachelor of Arts degree from Barnard College, Columbia University, including studies at University College, University of London.

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