UKG Poised to Maintain
Strong Growth Momentum

UKG, a leading HCM technology provider, is coming off a strong year of growth and product innovation, and company leaders made it clear at their Spring Analyst Day in Las Vegas that they will not let that momentum wane.

Let’s start with the numbers. UKG, a Brandon Hall Group™ Smartchoice® Preferred Provider, has 80,000 organizations in 150 countries using their solutions, reflecting a 14% growth in customers since last year. Their success comes in many product areas and for many reasons, not the least of which is an 8% growth in R&D spending over the past year, reflecting 17-18% of total revenue.

Rachel Barger, bringing experience from senior global roles at Cisco and SAP, just joined the company as President for Go to Market, working with CEO Chris Todd on understanding customer needs and driving sales growth. UKG is clearly on a trajectory to grow globally and Barger has deep international experience with over 20 years leading teams across the Americas, EMEA and the Asia Pacific region. At Cisco, she was SVP of Americas, overseeing approximately $37 billion in annual sales.

As always, UKG leaders covered a lot of ground during the briefing. Here are information and insights in five areas:

  • AI Strategy
  • SMB Market strategy
  • Impact of Great Places to Work®
  • Frontline workforce
  • UKG’s multi-country pay solution

UKG’s AI Strategy    

One of the keys to success in using AI in HCM, Brandon Hall Group™ evangelizes to its clients, is establishing compelling use cases that fit their unique needs. UKG has clearly established its own use cases for leveraging AI in its products:

  • Remove friction: Improve productivity and efficiency for managers and employees.
  • Reduce cognitive overload: Provide users with more insights and guidance based on learning people’s work preferences, patterns and intents.
  • Foster innovation: Generate new insights and content, delegate tasks and personalize experiences.

UKG recently announced the integration of GenAI into the payroll reporting process, addressing a big challenge for payroll teams — the time-consuming and often tedious process of searching, reviewing and auditing large datasets for specific information.

Beyond payroll processing and reporting, UKG has embedded GenAI throughout the UKG Pro suite, aimed at the enterprise market, to empower all employees, regardless of their role or location, to accomplish more during their everyday work. The AI-powered features include conversational search, which understands a user’s language and intent to deliver better results, as well as summarization, classification and content creation capabilities that help organizations identify trends, provide guidance and generate unique content based on existing data.

The AI in the UKG Pro suite is powered by UKG Bryte, an AI assistant that is part of the Pro FleX platform and trained on the world’s largest collection of people data, work data and culture data. By leveraging this vast repository of information, along with leading Large Language Foundational Models from Google Cloud and the customer’s unique data, Bryte provides employees with guidance, recommendations and proactive nudges grounded in proven strategies.

UKG’s head of AI and data products demonstrated several use cases. Like most tech companies working in AI, UKG’s work is evolving and is taking some twists and turns and analysts aggressively questioned the specifics of the strategy and execution. But we were impressed with UKG’s commitment and what they have accomplished so far. They are focusing their development on specific personas in an organization (e.g., HR leader, store manager, hourly frontline workforce). They have rich datasets, not just in terms of volume but also uniqueness, culture data from Great Place To Work® and transactional work data from WFM (nearly 40 million employees). They are in the controlled release phase of several solutions now (including skills pathing, performance self-reviews and leadership actions), with dozens more in the discovery phase.

UKG is focused on evolving from Large Language Models (LLMs) to Large Action Models (LAMs), through which “connected agents” will service specific UKG suite domains (workforce management [WFM], talent acquisition, payroll, etc.). For example, a Bryte “recruiter agent” can:

  • Help write job descriptions
  • Create and execute outreach campaigns
  • Match best-fit candidates to the position
  • Generate interview guides
  • Schedule candidate interviews, and more

This enables recruiters to complete in minutes what it would have taken days to do. The same approach can be used to help managers, payroll specialists and employees in various roles. It is a more focused approach to AI and UKG is at the forefront.

Bryte AI is embedded throughout the UKG Pro suite to help all employees, whether frontline or knowledge workers, accomplish more during the flow of everyday work. These models are built on battle-tested foundational models from Google and fine-tuned on industry-specific pseudonymized datasets from UKG.

With more than 2,500 AI models active across the UKG Pro suite and with more than 100 professionals developing AI solutions, UKG is in a strong competitive position.

Aggressive Focus on the SMB Market

UKG just passed the 50,000-customer milestone for the UKG Ready Suite, their small and middle-market (SMB) solution in North America, Australia and New Zealand. Todd stressed that, while UKG is focused on all markets, they are particularly bullish on SMBs. Because of the way UKG can adapt innovations like Bryte and the multi-county payroll platform, UKG One View™, into the Ready product, UKG has a significant advantage over SMB competitors such as Paylocity, PayCor and Paychex, where they have taken away some market share.

UKG has taken a multipronged approach, not only focusing on user experience and additional features like simplified benefits and onboarding, but also adding resources (more service and sales reps), and refining market positioning and messaging.

Many SMBs are still operating with legacy systems — or even on Excel spreadsheets. The functionality that UKG Ready brings can transform an organization’s operations. For example, the largest orthopedic practice in North Carolina used to hold multiple days of in-person new-hire orientations to meet healthcare compliance regulations. Now it conducts onboarding virtually. UKG’s onboarding dashboard eliminated on-site paperwork and gave the practice’s HR team and clinic supervisors one full day of their work weeks back each week — an estimated annual cost savings of $26,000.

Great Place to Work® Continues to Deliver

UKG’s acquisition of Great Place to Work®, a trusted authority on workplace culture, was one of its most insightful moves. It continues to provide unique data insights for UKG’s products, not to mention its impact on revenue and the company’s “our purpose is people” messaging. UKG’s growth and product enhancements over the past three years would not be possible without GPTW data.

UKG’s Great Place To Work Hub is the only solution that turns typical HR metrics into opportunities to build inclusive, equitable cultures by bringing together UKG research, customers’ data and their employees’ voices. Dashboards throughout the employee journey surface key metrics from the UKG Pro suite — diversity of talent pools, drill downs around promotions, voice of the employees from the Trust Index™ survey, helping customers prioritize areas of opportunity.

Equally important, a customer can benchmark their people practices against the top companies in their specific industry and receive guidance on how to best support their people. And with Bryte AI insights it will only get better. Over the past six months, 50 customers have added the GPTW Hub to their UKG Pro suite. Soon, UKG Pro Workforce Management customers will be able to deploy the hub to retain frontline employees and improve their work experience.

Focus on the Frontline Workforce

Depending on the industry sector and the information sources you use, between 60% and 80% of global workers are frontline employees, which until recently has been an extremely underserved population. As of late 2023, only about 1% of corporate technology budgets directly served frontline workers, according to various studies.

However, more employers are recognizing they must do better. Brandon Hall Group’s employee experience research shows that 73% of organizations said using innovative technologies to support frontline employee productivity and efficiency is important.

Frontline workers are often mobile or work out of multiple locations where it can be difficult to access devices and internet connectivity. Their jobs require specialized software and applications to access customer data, check inventory, submit orders, manage projects and more. They deal with customers face-to-face and need technologies that enable quick access to information to resolve issues on the spot.

UKG is well-positioned to serve the frontline workforce thanks to its huge data sets and industry-leading focus on WFM tech offerings. For example, UKG has solutions now that help organizations verify and track frontline skills and are using GenAI to predict hard-to-fill work shifts to head off productivity losses before they occur.

“Frontline workers provide a big opportunity for us,” Todd said. “We are world leaders in working with frontline workers and will lean even more into enabling frontline employees. It is a strategic differentiator for us and will continue to be so.”

Disruptive Multi-Country Pay Solution

With last year’s acquisition of Immedis and the launch of the UKG One View™ multi-country payroll solution, UKG firmly established itself as a leading player in global payroll. It is taking huge steps toward transforming the global payroll paradigm into a more efficient, technology-enabled multi-country payroll experience.

One View is the first multi-country payroll solution that can be deployed in days to weeks (rather than months) to unify payroll visibility across the globe, regardless of payroll execution method – in-country service providers, ERP payroll engines, or custom in-house solutions.

In the last few months, over a dozen customers chose One View to pay over 120,000 employees so they can deliver accurate, compliant payrolls and consistent experience to their people across more than 50 countries. Key enhancements to One View will add full self-management capabilities for customers to work directly with regional and in-country providers, and AI will power auto-validation of HR and Payroll data in real time to drive further efficiency, accuracy and compliance.

UKG One View™ also offers AI-driven payroll reporting and analytics that can shine a light on employee transaction costs and compensation planning, which is difficult across multiple countries without a single source of truth. The potential impact of UKG One View™ on employee experience as it evolves and expands is enormous.

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Claude Werder

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Claude Werder

Claude J. Werder Senior Vice President and Principal Analyst, Brandon Hall Group Claude Werder runs Brandon Hall Group’s Talent Management, Leadership Development and Diversity, Equity and Inclusion (DE&I) practices. His specific areas of focus include how organizations must transform culturally and strategically to meet the needs of the emerging workforce and workplace. Claude develops insights and solutions on employee experience, leadership, coaching, talent development, assessments, culture, DE&I, and other topics to help members and clients make talent development a competitive business advantage now and in the evolving future of work. Before joining Brandon Hall Group in 2012, Claude was an HR consultant and also spent more than 25 years as an executive and people leader for media and news organizations. This included a decade as the producer of the HR Technology Conference and Expo. He helped transform it from a small event to the world’s largest HR technology conference. Claude is a judge for the global Brandon Hall Group HCM Excellence Awards and Excellence in Technology Awards, contributes to the company’s HCM certification programs, and produces the firm’s annual HCM Excellence Conference. He is also a certified executive and leadership coach. He lives in Boynton Beach, FL.

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