Totoal Cost of Ownership Study Overview
- 1. PwC’s 2011 TotalCost of Ownership Study © 2010 ADP, Inc.
- 2. About the 2011TCO Study ► ADP has been working with PwC since 2003 to study TCO ► 2011 study is the 4th major study ► Industry's most comprehensive study ever of HR and payroll costs ► Independently researched and prepared by PwC ► New in this year’s study: ► 279 organizations studied, ranging from 100 to over 100,000 employees ► Payroll, HR, Time & Attendance, and H&W ► 50+ software vendors studied including SaaS and on-premise solutions 2 ©2010. ADP, Inc.
- 3. So in-house HRand payroll are how much??? Annual TCO (PEPY) of In-House Administration Breakdown of Payroll TCO by Cost Type ($178) ($329) 3 ©2010. ADP, Inc.
- 4. Well, at leastit is getting cheaper, isn’t it? ► Despite… Average TCO Per Paycheck Comparison ► Better technology, ► More hosted and SaaS solutions, ► Smaller HR and payroll department staffs, and ► Skipped upgrades… ► …the cost of in-house administration is actually increasing. “Cost effectiveness stems from comprehensive process transformation, not just technology innovations.” 4 ©2010. ADP, Inc.
- 5. So how canyou reduce your costs? ► #1 strategy identified by PwC to lower your HR and Payroll Total Cost of Ownership is to outsource TCO Comparison by Method for Large Organizations 5 ©2010. ADP, Inc.
- 6. So how canyou reduce your costs? ► #2 strategy identified by PwC to lower your TCO is to use a single vendor for all HR functions 6 ©2010. ADP, Inc.
Editor's Notes
- #6 So the top two strategies PwC identified to reduce your total HR and payroll cost of ownership are (1) outsourcing and (2) utilizing a single vendor for multiple HR functions Large organizations managing HR & payroll in-house spend 27% more, on average, than comparable organizations outsourcing at least payroll to ADP.
- #7 The potential cost savings get even greater when you use a single vendor for your all of your HR functions. There weren’t enough participants who used a single software vendor for all four major functions (payroll, HR, time, and benefits), but PwC was able to analyze organizations that had a single software vendor for payroll, HR, and time. It turns out that organizations using multiple software vendors for those 3 functions spend 9% more than organizations using a single in-house software vendor for payroll, HR, and time & attendance. What is even more interesting is that organizations who use multiple vendors for the 3 functions spend a shocking 41% more, on average, than similar organizations using ADP for all three functions.