Patersons Global Payroll

Montclair Advisors had done a SaaS business profile of Patersons in April 2010 and we wanted to get an update from their new CEO, Andrew Pearson. Andrew was brought into the company shortly after our profile was completed and came from SaaS collaboration provider IntraLinks where he was the Managing Director of EMEA.

With the change in management, the company has re-focused its strategy primarily around providing a robust global payroll software and services platform. This has been the company’s strength over time and they felt that this approach would open up some new ways to partner with the leading SaaS Talent Management and HCM providers if they weren’t also offering competitive products. Patersons solutions tend to be a very agile and can fit into any organization’s environment based on their infrastructure requirements. In addition, to their software platform Patersons will continue to offer customers a managed services option for their payroll processing needs.

New Partnerships

The big news was Paterson’s new partnership with Workday and how they were planning on supporting several of their larger customers who were looking for global payroll capability. Workday is focusing more on building out their financials platform in the near term and less on extending their payroll solutions, so partnering with Patersons for their Logon2 global payroll platform makes a lot of sense. The plan is to offer Workday customers not only their HCM and Talent Management solutions but also an integrated global payroll solution that allows the customer to turn off competitive payroll solutions over time. Often these types of companies may have many different payroll providers by the countries or regions that they are doing business in and by consolidating onto a single platform over time, this approach can deliver value on many different levels. This partnership was announced in January 2011.

The other big announcement that occurred after my interview with Andrew was that SuccessFactors had formed a similar partnership with Patersons’ for global payroll. Patersons will join the SuccessFactors’ partner program as a Strategic SuccessCloud Partner to provide complementary global payroll services to SuccessFactors’ multi-national customer base. The Patersons product will also be integrated into SuccessFactors’ Employee Central product, which will allow customers to streamline their payroll administration especially for multi-national operations.

Strategy

This re-focused strategy has been working with the company experiencing strong growth in excess of 40% annual growth and currently support more than 160 countries. Patersons today is concentrating on offering core ‘gross-to-net’ capabilities to 15 countries and will continue to expand their payroll platform out to up to 50 high GDP states and regions over the next few years. The only other software firm that has this level of cover is SAP but they aren’t going to SaaS anytime in the near future.

The future vision for Patersons is to offer their customers and partners a fully integrated global solution that allows large firms control over their payroll, ability to comply with governmental regulations as well as to reduce the cost of administration. For many of their target customers, who have grown through M&A, they have multiple vendors and a lot of technology, this level of complexity is driving up costs, and Patersons can help to streamline their payroll processes using both software and managed services.

The re-focusing of the Patersons’ strategy to primarily offer a SaaS-based global payroll platform appears to be gaining momentum and it appears that they are a company to watch here in the second half of 2011.

Company:                   Patersons

Started:                       1996

Located:                      Salisbury, United Kingdom

Geography:                  Global

Market:                        On-Demand Global Payroll

Products:                    Click4HR, Free HR, and Global HR and Payroll

Key Customers:          Constellation Europe, Henderson Global Investors, Interdean International Relocation, Siemens

Website:                      Patersons

Blog:                           Patersons Blog

Twitter:                       @patersons

Recent News:

Patersons Announces New Partnership with Lawson

CEO Honored At Growing Business Awards | APA Article

Patersons Shakes Up the Market Again Adding ESS to Free HR Offering

Patersons Shakes Up The Market Again With ESS Added To Free HR Offering

I asked Karen Paterson, Patersons Chief Executive Officer a few questions about her business and her view of the SaaS market as we move into 2010.

Did you start out as a Software-as-a-Service company?

Yes

Why do your customers buy from Patersons?

Patersons ‘Software-as-a-Service’ payroll platform delivers payroll on one single database, one technology platform worldwide. This is the only multi-tenant, multiple country online payroll processing platform in the world. Clients also only have one global contract with Patersons. The leading-edge platform promotes scalability and we can cater for any size payroll anywhere in the world, whether a client has 1 employee in Kazakhstan to 10,000 employees in China. Patersons Logon2 solution is as feature rich as major ERP solutions. It also delivers instant Sarbanes Oxley and SAS70 compliance with its unique International Payroll Workflow, therefore making sure all local requirements are adhered to in a timely and accurate manner. Patersons comprehensive global consolidated reporting suite allows quick analysis of global client data.

SaaS is based on the concept of ‘Pay-as-you-go‘ on-demand and customers only pay for what they use and nothing more. The solution is regularly updated and developed to stay in the forefront of the industry. There is also no additional expense for customers when upgrades or updates are made to the solution, and as the system is delivered via the Internet, customers receive upgrades in real-time. Patersons technology is developed 100% in-house, therefore we do not have to pay third party fees.

What do you see as the key trend emerging in the SaaS industry?

There is a strong move from on-premise ERP to SaaS as a serious alternative global solution.  Many companies are looking for best-of-breed in a vertical industry rather than an ERP which generally gets 20% functional use of what has been paid for.  The mistrust of not hosting and relying on an outsourcer to provide an IT function is interesting and an indication that internal IT department have been failing the HR function.

What is your outlook for 2010?

2010 will be the Year of SaaS and the Cloud.  Coming out of recession companies are seeking single process outsourcing solutions and best of breed choices from software vendors.