We talked to Replicon co-founder & co-CEO Raj Narayanaswamy about his perspective on time. Narayanaswamy explained how Replicon tracks time as an enterprise asset, which he sees as unique compared to other HCM vendors, who offer time as a module or add-on within a suite. Replicon integrates with payroll, HRIS, ERP, and project management systems to unify company records and streamline the end-user (employee) experience of tracking time. Narayanaswamy also updated us on compliance-as-a-service, or how Replicon delivers location-specific legal expertise. He sees this as increasingly important, since states like California are passing new compliance laws that change how time worked earns paid sick leave.
Introduction to Replicon
To start, give us some background about Replicon. What do you do, and what is your overall vision?
At Replicon, we consider time to be an enterprise asset. "I don’t have enough time" is the most common complaint. A company with 1,000 employees has over two million hours a year at its disposal, and we provide companies with an understanding about where those hours are going.
Replicon provides a time asset management platform on which companies can track time for their employees. We do that in three different ways: we help companies capture time, manage time, and then optimize that time. We take factors such as revenue leakage, productivity improvements and effective resource allocation into account for each step.
For example, we have a large educational institution with teachers, part-time employees, and interns. Different people have to track time in order to pay employees effectively. By using our platform, they were able to optimize their payroll costs, and they found that they were able to reduce payroll cost by 8% by finding mis-tracked time.
Another example: for consulting companies, the asset being sold is time, so tracking billable hours is very important. We have had clients increase revenue by up to 30% just by using our system, which allows users to capture all billable hours effectively.
Additionally, companies such as shared services organizations, legal, IT, or HR firms need to be able to account for their dollars. Our platform allows companies to determine how much time is being spent on key business units and determine if the return on investment justifies that time. We think time is the starting point of optimization for an organization. We don’t think of there being certain companies “in the productivity space”—rather, all companies want to increase productivity no matter what size or industry they are in.
Who are your competitors? How does Replicon differentiate in its approach?
Kronos, ADP, and a lot of other HCM vendors have time solutions built into their suite of products. We are unique in the sense that we consider time to be an enterprise asset. Other vendors think of time as an add-on module to an HCM, ERP, or even a project management solution. For us, time is its own pillar.
Sometimes, employees are using three different time systems. The same employee might be entering the same time in three different systems, such as payroll and project management. We start with the employee. We focus on making sure that people are being tracked effectively through a single system, making it really easy. We have created a system that starts with the end-user, empowering them to capture what’s going on in their day and report back to our time platform.
We also integrate with various backend systems, like HRIS, ERP, and project management systems. Not only do we integrate, we often pull in a lot of that functionality into our system. We have a list of applications for project management, invoicing, and other needs, and we incorporate so much data in our system that many customers don’t even need integration.
Our second key difference within the context of HCM is a new service we are launching: Compliance. We help customers calculate overtimes, various pay codes, and other such compliance issues, ensuring our customers will be compliant with local and federal wage and hour requirements.
A lot of legislation is coming in that is changing what it means to be compliant. In California, the new Healthy Workplace, Healthy Families Act now mandates employees to receive an hour of paid sick leave time for every 30 hours worked. Our system is like tax software: customers don’t need to know the rules and laws because the software does it for you. We are currently offering every state and every city in North America, and our library continues to be updated. Our stated goal is to offer this service on a global basis.
Strategically, how defensible is Replicon’s position on time, since other applications have time modules?
We think of it as domain expertise. ADP has domain expertise on HCM, payroll, and core HR services. It will require quite a bit of energy on their part to create domain expertise on project management and billing. With ADP: are they going to talk about time, or are they going to talk about HR? They will be forced to align their time solution around the answer to that question.
We talk about time from a different angle. Everything that I’ve talked about is organically built; we did not acquire different platforms and piece them together. Our platform is a time asset management platform.
Our platform is highly configurable and highly customizable. As a multi-tenant SaaS offering, we have maintained our configurability. Our platform comes in three editions: Quick Start, Plus, and Enterprise. Additionally, we have eight different applications that can be added on.
Quick Start is for smaller companies, up to 150 employees. Plus is for companies with up to 1,000 employees, and Enterprise is for really large organizations. For example, we are currently working on one implementation for 150,000 employees globally, and our compliance library will cover their entire global organization. Some of our largest current clients include Facebook, Credit Suisse, and Northern Trust. Many of our customers integrate us into their backend ERP and HCM solutions.
How does Replicon integrate with the physical world?
We think that traditional, hard-wired time clocks are dinosaurs and are going to go away. We have an iPad-based solution, which we call a "soft clock." It runs on a tablet device, and it includes capabilities such as near field communications, card swiping, and QR code scanning. We have a kit that can be used along with the iPad, but companies can just put up a tablet device at the bare minimum.
Customer Base & Product Development
Who is Replicon’s typical buyer?
The main buyers are in operations and HR. In some cases, organization transformation people get involved, especially when companies are considering the productivity angle.
For example, we are working with an insurance company to implement a company-wide productivity improvement strategy, using time data. We are working with them on a solution for their insurance claims adjusters in the field to capture employee data without asking the employee to enter in additional information. This process is entirely automated, and our software provides optimization insights based on the data pulled from employees.
Where are your customers coming from?
We still run into people using a lot of spreadsheets and manual processes. These companies often already have an HCM system, such as ADP or Workday, and they come to us because they have big time asset management holes despite these systems.
Greenfields opportunities are a big source for us, and compliance has actually turned out to be a big channel for us because we can ensure wage and hour compliance. This is a big sell, especially for companies looking at fast-growing globalization. When companies have different types of workers, say, hourly, non-exempt, and exempt, the complexity of time and payroll management increases dramatically. Our system was designed specifically for these compliance challenges, and customers find that very appealing.
What drove Replicon’s decision to focus on compliance?
It really came from our global customers, who were asking us to help configure our platform for their specific locations, from California to the Czech Republic. These change request processes kept coming to us, and we decided that compliance-as-a-service was the best way to handle these patterns across the world.
Our customers are looking for expertise, not features, and most don’t even want to think about the rules and regulations behind compliance. Going back to the tax software analogy, our platform figures out the compliance for our customers.
Trends for 2016
What do you see as key trends in HR technology for 2016?
Mobility is going to be bigger and bigger. Enterprises are adopting mobility. Not just Bring-Your-Own-Device, but in other ways as well.
I think you’re also going to see a trend toward big data. It's a huge buzzword, but you're going to see a lot of data-based decisions being made, everything from compliance to performance management to who’s going to stay in the company or who’s going to quit.
Looking at our own data, for example: People think that employees are stealing time. It's a myth that's out there. We analyzed our aggregate data anonymously, and we found that in the last 12 months up to July this year, June had the lowest percentage of vacation time, even though everyone thinks that the summer months are when people take the most time off. Also, employers are most likely to say no to time off requests in October.
That's an example of data that shows something really interesting, and can help both employees and businesses plan around how they can better optimize how time is spent in the workplace.
Original Source: TrustRadius