IQcatalyst

Health care is greatest concern

The rising cost of health care was cited as a pressing concern by 85% of respondents to a recent survey – beating out the war in Iraq, cited by 79% of respondents

The survey of 2,758 U.S. adults 18 years of age or older, reported that 79% of American adults polled said universal coverage would improve health care quality. Additionally, 88% of respondents agreed being able to go to any doctor would improve the quality of their health care over the next five years.

Other survey results, according to the release, included:

• Women are more likely than men to think universal health care coverage would improve the quality of healthcare over the next 5 years (83% of women vs. 75% of men).
• Women (38%) are more likely than men (19%) to have failed to fill a prescription due to expense, and women (34%) are also more likely than men (22%) to delay medical procedures due to expense.
• 68% of adults indicated they thought it would improve the quality of health care over the next 5 years if individuals became less dependent on health insurance companies for the cost of their own healthcare. Men (71%) are more likely than women (66%) to indicate that they thought lower dependency would improve healthcare quality.

Source(s): Harris Interactive, American Society for Quality (ASQ)

No big surprises here...

According to a recent study, firms primarily outsource their HR functions to achieve cost savings, access external skills and knowledge, and process improvements. In addition, outsourcing of such functions will allow them to focus on their core business.

The study revealed mixed responses among buyers of human resource outsourcing (HRO). According to the key findings;

• Approximately 31% of companies are expected to renew their existing HRO agreement with the vendor,
• Slightly over 17% are likely to outsource their HR functions to some other HRO services providers.
• Less than 10% agreed to end the existing contract and decided to retract HR functions in-house.
• Eight percent of the firms are likely to reduce the scope of their HR contracts
• While about 10 percent will expand the scope of their contracts.

The study revealed that in order to make an HRO deal a success, HRO service providers and buyers should work together to identify quantifiable and achievable benefits rather than quoting unachievable big cost-cutting benefits.

Source(s): EquaTerra

HCM versus HRMS

One of the regrettable, but unshakeable ironies about technology is that it seems to work just fine until people come along and mess it all up. And that is just the IT department. Heaven forbid any users should get involved.

Perhaps then, it should come as little surprise that the processes that concern themselves most with an organisation’s people – what used to be called Personnel and were later re-named Human Resources or HR– have not been among the most mainstream or high-profile channel market places.

However, if the innovators behind a new breed of ‘people technology’ are to be believed, this may be about to change. There is a new offering on the market – Human Capital Management (HCM) or Talent Management.

To read the entire article, please click on this link

Source(s): CRN

Kronos goes private in $1.8b deal

HR and payroll application vendor Kronos Inc has been bought by the private equity firm Hellman & Friedman Capital Partners (H&F) for $1.8b in a deal which CEO Aron Ain said would accelerate its expansion and enable it to reach its goal of becoming the first billion-dollar company exclusively focused on human capital management.

The $55 a share cash bid is a 17.9% premium on the closing price Thursday and an indicator that a software company such as Kronos, with solid recurring revenue, is increasingly attractive to a private equity sector awash with cash.

While the acquisitive activities of private equity has aroused suspicion in many parts of the world, it is increasingly attractive option to directors of public companies. They tend to moan privately about the ‘tyranny’ of quarterly reporting, and an emphasis on achieving short-term objectives that can be at the expense of long-term aims.

Kronos has been extremely acquisitive and Ain saw the deal as giving them an increased war chest. “We believe our new partnership with H&F will provide us with the financial freedom to realize our vision for the future of our company,” Ain said.

“H&F will encourage the company to continue pursuing strategic acquisitions, grow as a global company, and expand in the area of talent management.”

Aided by constant acquisitions, Kronos has been growing rapidly. In the year to September 30, while net income fell 23% to $41.4m, revenue rose 11.4% to $578.2m.

According to its latest quarterly filing, product sales only account for 35% of revenue. Maintenance provides a further 35%, professional services 22.8% and subscriptions the final 7.3%.

While Kronos is the biggest standalone vendor on HR software, its main opposition is the big application software players Oracle and SAP, who see HR as almost as important as their core financial software. Oracle has absorbed PeopleSoft, who reputedly had developed the best HR suite and SAP has been working hard at developing its own application in this area.

Source(s): ComputerWire, Kronos

Kelly acquires Talent Technology

Kelly has acquired Talents Technology, a California-headquartered permanent placement and executive search firm. The financial terms of the acquisition were not disclosed. The deal will increase company’s presence to 32 countries. Talents Technology offers services to companies catering to IT, pharmaceutical, and life science domains. Post-acquisition, Talents will be merged with Kelly's international business vertical.

Source(s): Kelly

HRO not a panacea...improvements to be had

Responses to  recently completed HR Outsourcing (HRO) survey showed that buyers are only experiencing moderate benefits from their HRO agreements. But while HRO hasn't borne out to be the panacea some had hoped for, many buyers believe improvements can be made to help them and their service providers still meet their original individual and mutual objectives.

The study was conducted in the second half of 2006. It included an online survey and interviews with more than 50 North American and Western European organizations that had undertaken multi-process HRO, some for over 10 years. The study yielded the following key findings:

• Top-ranking benefits sought by HRO buyers: cost reduction, (ranked highest), followed closely by access to external skills and knowledge, process improvements, and ability to internally focus on more strategic activities
• Only average success to date: on a one to five scale, with five being "benefits full achieved" and one being "benefits not at all achieved", most anticipated benefits received rankings of between 2.5 and 3.0
• Responsibility for HRO successes and problems: buyers tended to note that they share both success and problem responsibility with service providers, although they more often gave success credit to their own organization and placed blame on their provider
• Recompetes, terminations and renewals: 31% plan to renew with their current key HRO provider; 31% are uncertain of their future course on renewals; 17% plan to recompete with similar scope; 10% plan to terminate and bring work back in-house; 10% plan to recompete with expanded scope; and eight percent of respondents plan to recompete their contract with reduced scope; These percentages signal that even with dissatisfaction, most buyers will continue with some form of HRO

Source(s): EquaTerra

Not tracking absences could cost employers

According to preliminary results from a disability absence survey on Canadian (C) companies, if employers have no idea what these absences are costing and take no steps to control them, making the case for disability management or wellness programs may be more difficult.

For those organizations who said they used the data they had on disability absences, 16% said they did not use the data for strategic purposes.

The survey divided the costs of disability absences into three categories: workers' compensation, short-term disability and long-term disability.

The costs for an organization with 1,000 or more employees in terms of workers' compensation totaled C$850,780. For an organization with 500 unionized employees and 500 non-unionized employees, the short-term disability costs totaled about C$2.2 million and for long-term disability, the costs about are about C$519,500.

Some of the reasons the survey cites for employers’ not having sufficient data are:

• Organizations do not seem to be accessing and/or centrally collecting disability data from their third party vendors (workers’ compensation, insurance companies and/or third party disability vendors).
• Disability management coordinators (union employees) and HR staff generalists (non-union employees) are most often responsible for the administration of long-term disability absences.
• Privacy considerations and the inability of senior management to properly assess medical information prevents them for getting quality information.
• Third party administrators, such as insurance companies, collect better data for long-term disability absences.

Source(s): Hewitt, Plansponsor.com

One fifth workers to stay on after retirement

The survey of 390 companies wanted to see how these small companies are gearing up for the wave of a baby boomer retirement. The sponsoring organization represents firms that handle human resources chores for small and medium-sized businesses, from payroll to administering 401(k) retirement investment plans to helping companies plan for an aging work force.

The organization asserts that small businesses - which have seen an increase of 5% over the last five years of workers between 60 and 64 - may have a more difficult time dealing with a surge of retirees who want to keep working because they have limited resources.

Other results of the survey include:

• Of the nearly 20% of companies who said their workers would stay on after retirement, 37% said their employees were staying on because they liked it and 34% said they liked the income.
• Nearly three-quarters of companies said they offered a 401(k) plan and 53% contribute to it
• Only 8% of companies said they were likely to lose workers to early retirement, compared to 40% who said they wouldn't and more than half who said they didn't know.
• 56% said they see the advantage of retaining older workers after retirement; 12% said they didn't; and 32% had no opinion.
• Only six of the companies surveyed said they offer a phased retirement, in which workers can reduce their hours and start drawing on their pensions; 63% do not offer the plans and 36% were not familiar with them.
• Almost three-quarters of companies said they valued older workers because of their experience, 10% said it would be less expensive than training new employees; 9% say these workers could serve as mentors and trainers; and 7% said they provide continuity

To read the entire survey, click on this link

Source(s): National Association of Professional Employer Organizations (NAPEO), Plansponsor.com

Schindler awards payroll contract to ADP

ADP Employer Services International, announced that Schindler, a supplier of escalators and elevators , selected ADP to supply and maintain its payroll system. ADP Employer Services International, part of ADP Employer Services, offers GlobalView in more than 30 countries, to more than 55 multinational companies representing more than 550,000 employees. GlobalView leverages SAP solution for Human Capital Management (HCM) powered by SAP Netweaver.

Schindler chose ADP's single-source, multilingual, multicurrency payroll outsourcing service GlobalView to gain a single-source payroll solution for Schindler's 16,000 employees across 14 European countries. Schindler's multinational organization will replace its various existing systems with a single solution for Europe with implementation scheduled to last two years.

Source(s): ADP

ACS to go private?

Darwin Deason, who founded the company in 1988, joined with Cerberus Capital Management to acquire ACS. They are offering $59.25 per share in cash, a premium of 15.5% over the stock's closing price on Monday, Deason said in a press release. ACS spokesman Kevin Lightfoot confirmed Deason had proposed the acquisition. The full price including debt would be about $8.2B, he said.

Deason would remain executive chairman of the company following the buyout, and the business would keep operating in accordance with its current practices, he said in the release. The workforce would stay in place, and ACS would continue providing services to its customers.

Deason and Cerberus are ready to start negotiations with ACS's board, or a special committee of its independent directors, and move quickly to seal the deal, they said. They don't expect regulatory or other hurdles to keep them from a timely close. The partners are working with Citigroup Global Markets for financing.

ACS is one of the world's biggest computer services companies, along with Electronic Data Systems, IBM's IBM Global Services division, and other providers. Early last year, the company said it had considered a private-equity buyout or recapitalization to boost shareholder value but rejected both plans.  It was still looking at ways to boost value but had stopped considering a selloff.

The buyout proposal came amid reports of a possible private equity buyout of another high-tech company, Palm. In such deals, investors usually look at a company and determine if it can deliver a rate of return that's greater than the cost of borrowing money for the acquisition. These deals are "trendy" right now and tend to happen when financial institutions have a lot of money and are looking for better returns on it.

Source(s): IDG News Services