HR Systems Survey Results

Debut of the 2016 2017 HR Systems Survey Results 19 th Annual Edition European Breakouts October 25, 2016

Sierra-Cedar Fast Facts 7 19 950+ Service & Solution Areas Application Services Business Intelligence Host & Managed Services Infrastructure Services Integration & Cloud Solutions Research Strategy Training Years of Leading HR Systems Survey & Thought Leadership 1,500+ Consulting Projects Employees Industry Focus Commercial Healthcare Higher Education Public Sector Justice & Public Safety Delivering industry-focused client success by providing consulting, technical, and managed services for the deployment, management and optimization of next-generation applications and technology. 5 2

Sierra-Cedar 2016 2017 HR Systems Survey Over 19 years of continuous data gathering The most comprehensive survey in the industry: Strategy, Process, and Structure Administrative and Service Delivery Applications Workforce Management Applications Talent Management Applications BI/Analytics/Workforce Planning Applications Integration and Implementation Emerging Technologies and Innovations Vendor Landscape Workforce and HR Expenditures Workforce Usage and Perception Participate in the 20 th Annual Survey Download the 19 th Annual White Paper 3

Organization Sizes and Types Large 10,000+ Medium 2,500 10,000 Small <2,500 Data-Driven Talent-Driven Top Performers Aggregate 4

Sierra-Cedar 2016 2017 HR Systems Survey Demographics: All Respondents 1,528 Organizations 20.6 Million Employees/Contingents Avg. number of Employees = 13,551 2 Industries 2 16% 15% 14% 14% 1 9% 8% 56% Other Manufacturing Health Finance Higher Ed High Tech Trans./Comm. Retail Ag. Mining. Utilities Const. 5

Sierra-Cedar 2016 2017 HR Systems Survey Demographics: EMEA Respondents EMEA 169 Organizations 5.2 Million Employees/Contingents Avg. number of Employees = 31,160 Industries 4 20% 19% 2 15% 8% 9% 5% 3 Other Manufacturing Health Finance Higher Ed High Tech Trans./Comm. Retail Ag. Mining. Utilities Const. 6

Key Themes for 2016 2017 Survey Results Strategy HR Technology Strategy Culture Outcome-Focused HR Technology Enterprise HR Cloud Pathways Forward Constant Change Relationships SMB Opportunity EE Trust & Transparency Intelligent Systems 7

FIN Sierra-Cedar HCM Application Blueprint General Ledger, Purchasing, Budgeting, T&E Vendor Management Enterprise Data Privacy Enterprise Content Enterprise Social Enterprise Workflow VMS 66% Adoption Self Service/Direct Access Employee Self Service Manager Self Service Service Delivery HR Help Desk, Portal 90% Adoption Administrative Excellence Service Delivery Excellence Workforce Management Excellence Talent Management Excellence Workforce Optimization Excellence Administrative Apps Core HRMS, Roles/Competencies (Profile Mgt.), Payroll, Benefit Admin, Embedded HR Analytics, 60% Adoption Workforce Management Time & Labor, Absence & Leave Management, Labor Scheduling, Labor Budgeting, WFM Analytics, 39% Adoption Workforce Optimization Workforce Planning, Workforce Analytics, Predictive Analytics Business Intelligence Foundation Reporting/Visualization and BI tools 5 Adoption Talent Management Recruiting, Performance, Learning, Compensation, Succession, Career, Talent Profile, Onboarding, TM Analytics CRM Network Security Mobile Access Backlog, Pipeline, Customer Satisfaction SOA, API, ETL PaaS Integration Platform Project Costing, Contracts, Grants Projects

Application Adoption Levels by Region USA 9 6 59% 5 39% 36% CAN 9 65% 59% 48% 35% 3 EMEA 8 7 70% 54% 44% 3 APAC 7 55% 66% 39% 3 28% Admin Service Delivery WFM TM BI/Analytics Social 9

Top 4 Major HR Initiatives By Region Everyone is Investing 25% or More of Their Time and Resources Here 64% 66% 4 40% 4 39% 38% 3 Bus. Proc improvement HR Systems Strategy Talent Management Service Delivery Worldwide Average EMEA

2016 HR Systems Strategy By Region 14% 30% Worldwide Average 3 1 EMEA 4 10% 2 3 Updated Regularly In Development Updated Rarely No Plans 2X HR Systems Strategies Increases Value to Business Organizations with a Regularly Updated HR Systems Strategy are twice as likely to be viewed by all levels of management as contributing strategic value, versus organizations that have no HR Systems Strategy. 11

Remaining Top 10 HR Initiatives By Region Noticing What Makes Them Different Worldwide Average 34% 20% 19% 18% 1 1 Bi/Workforce Metrics HR Apps Integration Workforce Management Workforce Planning All Systems Ingegration Social Enablement EMEA 3 3 2 24% 2 2 n=1,528 BI/Workforce Metrics Expanding to Global HRMS HR Apps Integration Social Enablement Replacing HRMS Mobile Enablement

Business Process Improvement Initiatives Where do Organizations Plan to Spend Their Time? Service Delivery Payroll 8% Core HR Compensation, Benefits, Rewards 8% Service Delivery Self Service/Direct Access 1 Administrative Apps 1 5% are working on all HR processes at once Recruiting 20% Onboarding 1 Performance Learning & Skills Succession 10% 1 Talent Management 16% are working on non-hr processes (operational) HR Analytics 6% Workforce Optimization 13

2016 2017 HR Tech Spending Trends Outlook Outside the US Spending Increases Continue 2016 2017 Regional HR Technology Spending Plans USA 39% 54% CAN 10% 4 4 EMEA 6% 39% 55% APAC 6% 39% 56% Increase Stay the Same Decrease

Tomorrow s HR is More Focused and Analytical What HR roles does your organization plan to increase or decrease this year? Worldwide Average 2 2 2 10% 14% 15% 10% 1 16% 16% 6% 5% 8% Payroll HR Management HR Generalist HR Business Partner Benefits Workforce Management HR IT Infrastructure HR System Support 29% 3 4% 5% Talent Management HR Data Analytics 3 Learning & Development EMEA 24% 10% 25% 1 2 1 2 16% 20% 2 1 10% 3 3 18% 1 4 6% 45% 10% 39% Payroll HR Management HR Generalist HR Business Partner Benefits Decrease Workforce Management HR IT Infrastructure Increase HR System Support Talent Management HR Data Analytics Learning & Development 15

2016 The Enterprise HR Cloud Conversation Expectations are High That On Premise HRMS s Will Decline SaaS/Cloud Worldwide Average On-Premise SaaS/Cloud EMEA On-Premise WFM Cloud 4 50% 5 44% WFM Cloud 2 35% 70% 60% Payroll Cloud 5 59% 4 35% Payroll Cloud 35% 4 64% 5 HRMS Cloud 5 6 54% 38% HRMS Cloud 3 6 59% 8 TM Cloud 66% 7 3 24% TM Cloud 5 68% 38% 28% Today 12 Months Today 12 Months 16

Multiple Pathways to an HR Tech Transformation Todays State of Replacing HR Technology in EMEA Worldwide Average 60% more Rip & Replace in Aggregate Data Rip & Replace Move everything all at once to the Cloud Hybrids Move ONLY TM or WFM apps to Cloud Hosting/Outsource Single Tenant, or BPO Parallel/Patchwork Combination Licensed and Cloud Solutions Current State High Risk Low Risk Focused Reactive 17

Multiple Pathways to an HR Tech Transformation Future State of EMEA Replacing HR Technology Hybrids Move ONLY TM or WFM apps to Cloud Rip & Replace Move everything all at once to the Cloud Patchwork Replace as License Ends Hosting/ Outsource Single Tenant, or BPO Future Plans Parallel Combo Licensed and Cloud Solutions High Risk Low Risk Focused Reactive

EMEA Plans For Replacing HR Technologies 40% of Organizations are planning to replace or evaluating options 49% No Change 66% 6 56% Replace in 12 24 Months Evaluating 4X More likely to replace a vendor if User Experience Score is low Worldwide Average 25% less likely to be evaluating options now 24% 26% 16% 1 1 2 24% 2 HRMS Payroll WFM Suite TM Suite 19

Does the Technology Meet Your Current Needs? EMEA, 50% More Believe Payroll Never or only Sometimes Meets Needs 1 1 1 0% 1 0% 4% 1 1 4% 8% 1 10% 25% 5 1 1 Payroll Meets Our Needs HRMS Meets Our Needs WFM Meets Our Needs TMS Meets Our Needs 6 58% 58% Always Most Times ½ Time Sometimes Never 20

Plans for Implementations and Upgrades 1 20% 1 1 8% 15% 9% 1 EMEA 15% 2 HRMS Upgrade HRMS Replacement HRMS Upgrade HRMS Replacement 21

HRMS Adoption By Size Oracle (PS) SAP (HCM) Workday Kronos WFC WFR ADP (GV/V) Oracle (EBS/JD) SuccessFactors (EC) Oracle (HCM Cloud) Infor Cloud/Lawson UltiPro Ceridian Dayforce ADP (WN) Paycor 34% 3 2 16% 15% 2 15% 10% 1 9% 9% 8% 1 10% 5% 4% 4% 0% Today 12 months 2 25% 4% 18% 24% 1 1 10% 9% 6% 4% 5% 5% 10% 6% 9% 5% 5% Today 12 months 6% 1 15% 5% 5% 18% 18% 4% 1 1 5% 6% 15% 15% 1 1 Today 12 months 22

HRMS Adoption EMEA SAP (HCM) 19% 26% Oracle (PS) 1 16% ADP (WN/GV/Vantage) 1 14% SuccessFactors (EC) 16% 2 Workday 8% 1 Oracle (EBS/JD) 6% 8% Oracle (HCM Cloud) 10% Kronos (Combined) 4% UltiPro Meta4 Ceridian Dayforce Epicor Today 12 months 23

Vendor Satisfaction Dissatisfied Very Satisfied Administrative Good Enough Zone We Expect More! Zone Workday Oracle PS Ceridian DF Paycor ADP GV/E SAP (HCM) Kronos WFC UltiPro SF (EC) SumTotal SS Oracle EBS ADP (WN) Oracle (HCM C) ADP (V) SilkRoad Infor/Lawson Kronos WFR Poor Good User Experience Excellent 24

High and Low Vendor Satisfaction Drivers Are We Forgetting About the Customization Needs? Top Benefits Correlated with High Vendor Satisfaction Top Challenges Correlated with Low Vendor Satisfaction 40% Greater than Last Year 66% 3 3 35% 35% 3 2 2 25% 38% User Experience Ability to Customize Integrated Solution Best Practice Functionality Service & Support Updates/ Upgrades High Costs Not Integrated Lack of Innovation Poor User Experience 25

Payroll Adoption By Size Oracle (PS) 2 28% ADP (GV) 1 1 SAP (HCM) 1 19% Workday 8% 1 Oracle (EBS/JD) 8% ADP (WN) 8% 5% Infor/Lawson 5% 4% ADP (Vantage) 5% 4% Kronos WFR 4% HR BPO (NG, Aon, Infosys) 4% Ultipro 4% Ceridian Dayforce/HR Oracle (HCM Cloud) NG HR (Preceda/Moore) SuccessFactors (EC) Paycor 0% 0% Today 12 months 2 2 8% 4% 1 18% 4% 8% 4% 10% 8% 0% Today 12 months 5% 4% 10% 0% 2 2 4% 5% 5% 4% 0% 1 15% 8% 0% 0% 0% 1 18% Today 12 months 26

Payroll Adoption EMEA SAP (HCM) ADP (GV) Oracle (PS) ADP (WN) NGA HR (P/M/R) Oracle (EBS/JD) CeridianHR ADP (Vantage) SuccessFactors (EC) Ultipro Oracle (HCM Cloud) Ramco Raet HRO/BPO Aggregators Ceridian Dayforce Workday Epicor Unit 4 5% 5% 5% 4% 5% 5% 4% 4% 4% 8% 10% Today 1 1 12 months 2 2 26% 27

Higher Cloud Adoption = More Needs Met? Our HR Systems Always Meets Our Needs 3 1 24% 20% 2 8% 9% 8% Payroll HRMS WFM TMS High Cloud Low Cloud 28

Implementations Timelines Continue to Decrease 40% decrease in all Implementation timelines in the last 3 years Length of Time for New HRMS Deployments In Months JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR Large Licensed On-premise = 15.5 Months Large SaaS = 13 Months HRMS + An average of 2.0 other HR modules implemented Medium Licensed On-premise = 11.1 Months Medium SaaS = 11.4 Months HRMS + An average of 2.1 other HR modules implemented Small Licensed On-premise = 7 Months Small SaaS = 6.9 Months HRMS + An average of 1.9 other modules implemented

Updates and Upgrades SaaS HRMS Update Average # of Weeks Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Large = 6.0 Weeks Medium = 6.7 Weeks Small = 3.8 Weeks Licensed HRMS Upgrade Average # of Months JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Large = 7.6 Months Medium = 6.6 Months Small = 5.3 Months 30

2016 Change Management Practices By Region EMEA Better Prepared for Cloud with Change Management Practices 2 8% Worldwide Average 2 25% 8% EMEA 3 38% 34% Consistent culture of change mangement Key projects that meet criteria Sporadically, with no criteria Never 4X Change Management Increases Strategic Value of HR Organizations with a Culture of Change Management are twice as likely to be viewed by all levels of management as contributing strategic value, versus organizations that never use change management. 31

2016 Integration Strategies Matter In Implementation Years, Integration Costs can reach 40% of Expenditures Enterprise Integration Strategy? EMEA Approach to Integrating HR Technology Case by Case 39% 65% 4 Into core HR 14% 35% EMEA 4 Aggregate 38% Spend 10 25% of their HR Technology budgets on Integration Into TM Suite Integration platform Other 24% 8% 5% Yes or Developing No Strategy/Unknown None 10% 32

Data Privacy & Protection Strategies In EMEA only 40% of Organizations Feel Prepared in this Area? EMEA EMEA Data Privacy Process Maturity 15% 10% Transformational 46% 30% Effective Efficient No process/manual High Cloud 2 more likely to be confident in Data Privacy processes

What Is HR Analytics?

Business Intelligence/HR Analytics HRMS Embedded HR Analytics solutions Reach Tipping Point If they have a BI/HR analytics solution, what is in use? 39% of Organizations are doing some form of BI/HR Analytics with one of these tools 38% increase in Adoption from last year 98% 1 25% 2 24% 34% 55% 40% Dedicated HR/BI Solutions BI Visualization Tools Statistical Tools Emb TM Analytics Emb WFM Analytics Emb HRMS Analytics Platform BI Solution Microsoft Excel n = 681 35

Workforce Planning Realities Rip & Replace Orgs More Likely to Conduct Enterprise Workforce Planning 66% More Likely 2 of all organizations are conducting Enterprise Workforce Planning Enterprise Workforce Planning 30% 2 2 19% 18% Rip & Replace Hosting Parallel Hybrid Patchwork Workforce Planning Approaches 36

Modern HR Changes Everything Rethink Implementations, Change Management, and Cost Assumptions Traditional OnPremise World Modern Cloud World SI s Extra Hands & Extra Work =/< 25% implementation done by SIs takes 25% longer and costs more Project-Based Change Management Licensed 2X more likely to conduct BPI efforts before Implementation Work vs SaaS Negotiate Lowest Cost 8% lower UE and VS scores 10% lower Business Outcome averages SI s Strategic Partners =/> 60% implementation done by SIs is 20% faster & within budget Continuous Change Management 4X more likely to be viewed as contributing strategic value to their organizations Negotiate Better Relationships Cloud Tech, 1½X more likely to Always Meet Needs % Expenditures & Budgets Allocated % Expenditures & Budgets Allocated IT = 8%, Ops = 9%, HR = 15% IT =, Ops = 5%, HR = 24% 37

2016 Business Systems: On the Move to Cloud 25% Increase in Organizations Evaluating Cloud Solutions from Last Year Worldwide Average Non-HR Systems in the Cloud Today? EMEA Sales/CRM 3 14% 48% Sales/CRM 38% 2 34% Operations Systems 1 1 59% Operations Systems 1 8% 1 6 Marketing Systems 1 5% 15% 6 Marketing Systems 19% 6% 26% 49% Financial Systems 1 10% 2 5 Financial Systems 16% 4% 2 58% Vendor Mgmt 15% 8% 19% 58% Vendor Mgmt 1 8% 2 5 Cloud today Cloud in 12 24 Months Evaluating No Plans 38

Mobile-enabled HR Process Adoption Overall Mobile Adoption Has Doubled in the Last Three Years Worldwide Average Organizations that Use Mobile-enabled HR Technology EMEA Organizations that Use Mobile-enabled HR Technology 39% 4 3 40% 2016 12 Months 2016 12 Months 39

Social Continues to Grow in EMEA Twitter Hits 50% in Aggregate, and 30% in EMEA, & New Tools Show Up Social Tools Use and Plans LinkedIn 65% 9% 16% 4% Collaboration 66% 8% 14% 1 Facebook 4 2 20% 5% YouTube 46% 18% 4% 14% 14% Corporate SN 39% 9% 1 9% 2 Twitter 34% 2 19% 16% Instagram 15% 2 25% 3 Snapchat 1 29% 45% Tumblr 0% 9% 4% 25% 60% Strategic Use Today Evaluating Use Strategic Use in 12 months Individual use only Not allowed No plans 40

Strategic Social Technology Use by Generations One of the Only Areas Where Differences Show Up in Technology Adoption 7 64% 65% 55% 48% 4 35% 1 5% Older Workforce Equal Generations Younger Workforce 41

The Value Placed On Emerging Tech Features EMEA Values Them More Than Aggregate Very Valuable No Value Some Value EMEA Worldwide Average Voice Interface Robotics/ Artificial Intelligence Experience API Gamification/ Badges Predictive Analytics 42

Wrapping Up: Takeaways Enterprise HR Systems Strategy, You Need One Multiple Pathways to the Modern HR Tech Environment, but Payroll and Workforce Management Solutions need addressed to reach an Enterprise HR Cloud Vendors and Buyers Need to Build Stronger Relationships in this new HR Future. Emerging Technology is about Achieving Outcomes 43

44 Thank you!

Visit Sierra-Cedar Website Get Full Survey Details and Sign Up To Participate Next Year! www.sierra-cedar.com/annual-survey 45

Sierra-Cedar 2016 2017 HR Systems Survey Demographics: International and Global Organizations 335 Organizations with HQ outside the US 550 Global Organizations 78% 4% 1 6% Non- Global 6 Global 3 The average global organization has operations in over 25 different countries. 46

Sierra-Cedar 2016 2017 HR Systems Survey Demographics: EMEA Respondents EMEA 169 Organizations 5.2 Million Employees/Contingents Avg. number of Employees = 31,160 Industries 4 20% 19% 2 15% 8% 9% 5% 3 Other Manufacturing Health Finance Higher Ed High Tech Trans./Comm. Retail Ag. Mining. Utilities Const. 47

Survey Methodology Sierra-Cedar follows rigorous standards in the form of a nine-step survey methodology, independently validated in 2011 by the Mercer Survey Quality group. Each year, this annual reach provides a wealth of knowledge that is shared openly with the HR systems community. All participants are kept strictly anonymous, and only aggregate data is used. 48

Stacey Harris Vice President Research and Analytics, Sierra-Cedar Background: Oversee the Annual HR Systems Survey and its safekeeping for the Industry HR and OE Practitioner for over 10 years in finance, retail, and franchised businesses. Director of Research at Bersin & Associates, Launched the HR research practice VP of Research for Brandon Hall Group Major Research and Papers: The High Impact HR Organization, The HR Framework, Employee Engagement: A Changing Marketplace, and Relationship Centered Learning Feel free to connect at: www.linkedin.com/in/staceyharris @StaceyHarrisHR

Why Organizations Participate? To obtain a personalized benchmarking snapshot filtered by size, region, or industry They like conducting a review of their own enterprise HR system environment annually They need data to build their own HR Technology strategy or business case for change They believe it is important to support the broader HR technology community Metrics tell such a great story and are fabulous for supporting proposed initiatives. The data provided underscored what we have been hearing and seeing as trends in HR especially as they relate to social media. Leslie Krug HRIT 50