What’s the sexiest tech acquisition of the past five or six years? You probably just had “Instagram” somewhere near your lips, but what if it were a time and attendance suite?
Like it or not, some HCM acquisitions are notably sexier than others in the eyes of the outside world. Remember the “Big Three” of 2010? Kenexa, Taleo, and SuccessFactors were all gobbled up in deals that made big news inside and outside of HCM. They created notable shifts within HCM and reams of all kinds of analysis.
There’s also a tremendous amount of VC money in the HCM space right now (north of $3 billion by the end of this year even conservative estimates), and some eye-popping figures around sexier AI tech have drawn headlines galore. We all want to believe the robots will make our lives easier, right? Just not come for our jobs, hopefully.
No wonder it could feel like my company’s acquisition of time and attendance player NOVAtime might seem like the dull white bread of the HR tech world. It seems so 1998. After all, don’t all the big players have T&A now? Aren’t all the building-block features of the working world — features like tracking time and attendance — kinda, well, boring?
No and no and no.
Here’s how T&A makes a difference
Ryan Fuller is the founder of a company called VoloMetrix. Microsoft acquired it in 2015. Writing for Harvard Business Review a year later, Fuller talks about consulting with a multi-billion dollar technology firm that shifted its emphasis from “aggressive growth” to “profitable growth.” In the process of that shift, the company wanted to analyze productivity and effectiveness across its employees and partner ecosystem.
After a data deep-dive, this troubling context emerged:
After much iteration, the general conclusion was that at least 50 percent of the total time employees spent engaging with these partners had no correlation with enterprise value. That’s one million hours annually (not including internal prep time), or the equivalent of 500 full-time workers. Every day, they were dedicated to activities that appeared to be at best redundant or potentially even value destroying, with multiple employees from multiple teams engaging with the same people at the same partners in an uncoordinated way.
Obviously, this was a bit terrifying: A company making billions of dollars has the equivalent of nearly 500 employees working full time on activities with “no correlation with enterprise value.”
That’s a white-collar example, but this lack of clarity around what exactly employees do with their time is hardly limited to white-collar roles.
Although blue-collar jobs have fallen to roughly 13.2% of the American workforce, they almost always require a strong time and attendance context; being physically on site often matters more in blue-collar roles than in enterprise-level positions.
Retail roles, for example, are massively connected to tracking time and attendance. Retail is 5.9% of the U.S. gross domestic product, or about $1.14 trillion in value-add. And we haven’t even touched on business models based on billable hours — law firms, professional services firms, and some agencies. In those contexts, hours are the product. And what business leader doesn’t have a firm grasp on their product? The answer: None that are successful.
Grow or die
Any business needs to demonstrate growth in the modern economy. We’ve all heard the mantra, “If you’re not growing, you’re dying.” It applies to companies regardless of whether they’re white-collar, blue-collar, retail, or a billable model.
The thing is, there are different paths to growth. Many business experts and investors start down that path wanting to see scale. Scaling products is valid, of course. But any business that grows needs to also scale its people and their work. And work becomes much more complex when two co-founders become 10 employees, 10 employees become an office of 50, 50 become a campus of 100, and so on.
Understaffing or poor utilization?
The current labor market is very tight. At the same time, numerous industries report an understaffing problem, i.e. the oft-referenced “skills gap.” In many cases this is completely true. Oftentimes, though, the perception of being understaffed comes from a lack of understanding around what people are doing all day. When you have a better handle on time and attendance, you have a better handle on what your business needs overall, which is crucial in the modern labor market. Now you can center talent acquisition around value-add roles, as opposed to an assumption of what might be a value-add role.
The bottom line: You can’t scale or grow unless you understand where your people are physically, when they’re in the building and when they’re not, what time they’re taking off, what hours are going to have what impact on clients and partners, and where the redundancies lie. It is literally impossible to scale and grow without understanding those basic building blocks of what employees are doing and when they’re doing it.
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Sure, maybe a time and attendance acquisition isn’t the sexiest thing to come down the pike. It’s certainly not Amazon grabbing Twitch or Indeed eating Glassdoor. But time and attendance acquisitions are massively important to how we work:
- They are the building blocks for scale and growth in the HCM technology space.
- They help the acquiring HCM suite become an end-to-end solution.
End-to-end suites offer more options to their customers. Most companies don’t want to manage 20 platforms just to get their basic work done They want everything they need in one place. It makes their daily lives easier. Having time and attendance baked in with other HCM table-stakes features makes a ton of sense.
For work to actually, well, work, we need time and attendance acquisitions all over the ecosystem.
We think that’s actually pretty sexy stuff, and something more business leaders, analysts, and investors should pay attention to.