This May, UKG held their spring analyst update in Boston where we were briefed on their progress and focus moving forward. You can read my last update from December 2022 here for context.

If you were not aware, UKG came to be as a merger between Workforce Management powerhouse Kronos, Inc. and HCM and Payroll leader Ultimate Software 36 months ago. Both companies had an excellent culture (they were both consistently in the very top echelon of the Great Place to Work ratings year over year). This hasn’t changed under the new merger which is excellent news for UKG customers as they always look to infuse this into their products and services (which can be an enabler of any client to maximize their own employee experience).

UKG has a global reach and a large customer base (over 75,000) with product offerings including Payroll, HCM, Workforce Management (WFM) and HR Service Delivery. They are one of the few solution providers that can handle all company sizes from small business, midmarket and enterprise. Currently they operate in the Americas, EMEA and APAC with over 15k employees – so if you have a local or global footprint, UKG can be considered to be an option.

Growth
The growth of their business has been nothing short of phenomenal over the past 3 years and their CEO Chris Todd took us through why this has happened.

The Why of UKG
Their modus operandi is “Inspire every employee. Support every business. Elevate every workplace.”

The What of UKG
Growth - Grow revenue to $5B and cash operating earnings to $1.5B by FY25
Running their Business - everything that UKG does is centered on a simple saying “Be the One” meaning that they aspire to these 3 goals:

• ONE unrivaled suite in all our products
• ONE people-first purpose for U Krewers (their name for UKG employees) AND customers
• ONE approach to simplify the way we do business

The How of UKG
The values that they care about the most are:

• United - through Inclusion and collaboration across the company
• Kind - by being trusting and caring about every employee
• Growing - through being agile

UKG’s focus on Customer Support
Innovation is one thing but without high-quality customer support, nothing works well and clients will simply churn. UKG has a very large suite as it encompasses Payroll, HCM, Service Delivery and WFM and as such it required a different approach to solving customer issues. As of December of 2022, they started to create a POD approach where there is a dedicated team assigned to each customer with experts in all areas. As of April, all customers have a dedicated POD assigned to them. The results have been tremendous with an 18% increase in Customer Satisfaction scores and a 25% reduction in resolution time.
 

UKGs commitment to ESG
Why is this important?

• According to the 2023 Edelman Trust Barometer 63% of potential customers buy or advocate for brands based on their beliefs and values
• Prospect Request for Proposals including ESG datapoints are more than doubling year-over-year
• 30% of potential employees who visit the UKG careers page also visit our ESG pages on their website
• UKG gets more than 30 requests from investors and customers annually to complete ESG surveys/audits

Broken down, UKG focuses on these areas of ESG:

• Environment – Climate Change, E Waste and Waste
• Social – Talent and Culture, Customer Satisfaction and Success, DEIB, and Social Impact
• Governance – Privacy and Data Security, Governance and Business Ethics, and Cybersecurity

UKG recently published their 2022 Global Impact Report which you can see here.

Some of the high-level activities that UKG is focusing on are:

• Their 2026 Social Equity, Opportunity & Impact Goal is to Achieve 50% increase in Employee Giving and Volunteering Hours
• UKG is sponsoring the NWSL Challenge Cup on a multi-year deal. The 2023 UKG NWSL Challenge Cup will be the first-ever women’s professional soccer tournament to achieve pay equity with its U.S. peers in the men’s game. After already increasing the bonus pool tenfold in 2022, UKG will double the prize pool for the 2023 UKG NWSL Challenge Cup, representing a significant step forward in reaching pay parity with the U.S. men’s game. Further, UKG is again collaborating with NWSL athletes Sydney Leroux and Christen Press to rally national awareness and support for pay equity by challenging everyone to level the playing field.
• Making good on its own commitment to close the gap, and following its unique pledge to invest 17 cents — the current gender wage gap — for every employee paid through a UKG payroll solution per year, UKG will contribute more than $3 million toward raising awareness and supporting organizations that are making tangible strides in building equity in education, representation, and opportunity in the workplace. This includes financial contributions to nonprofit organizations Grantmakers for Girls of Color, LeanIn.org, Reboot Representation, and 9to5.

UKG Product Suite

UKG Product Vision - To help every organization Become a Great Place to Work by building people-centric, Life-work Technology that meets each employee
where they are on their journey.

What Makes UKG Unique

• Creating a Great Place to Work – UKG has the insights from the most comprehensive people data in the industry and have built insights from this data into their suite to give you and your full management team the ability to aspire to be a best places to work business which will allow you to outperform your competitors. This is very unique in the HR solutions space.
• Delivering a Human-Centered Suite – their suite is designed around people to provide personalized experiences and connections. They will continually make their products more inclusive as well as focused on the individual employee needs.
• Making the Hard Stuff Simple - they manage the most complex workforces of frontline, salaried, and hybrid workers, with solutions for the world's smallest to largest companies
• UKG serve many personas (not just knowledge workers). They excel at serving frontline workers (who make up 60% to 80% of the total workforce) as well as Gig workers, contractors and temp workers

What markets do they serve?
UKG serves the entire market with 2 different products. UKG Ready serves companies under 500 employees while UKG Pro serves 500 employees and above all of the way to large enterprise. Both suites have a full HCM and Workforce Management Solution. Below is a detailed representation of what is included. The bottom line is, UKG can serve any size business and can grow with them as they grow.



Innovation
In their newest update, they have delivered over 2,000 client-facing features (with 25% of them based on customer feedback). That is quite a lot and shows their dedication to continuously improving their offering. Below are a few standouts of what UKG has been working on.

UKG FleX
FleX helps organizations evolve alongside the needs of their people, connecting the business with emerging applications to meet people where they want to work — whether within UKG solutions or other systems of communication and engagement — to foster exceptional and transformative employee experiences. UKG FleX is the innovative technology platform helping people-first organizations transform into great workplaces.

FleX features five primary components:

• FleX Foundation: Enterprise Software Amplifiers – The underlying foundation that forms their flexible architecture and enables innovation throughout the UKG Pro suite. Includes Authentication, Workflow, Documents & E-Sign, and Notifications.
• FleX Dev: Extensibility Tools – Developer tools and resources that empower everyone to connect, integrate and extend UKG products whether that is extending UKG outward or building inside the platform.
• FleX Flow: Turnkey Integrations - Extending UKG into the flow of work seamlessly with ready-made solutions and services from 250+ partners in the UKG Partner Network. FleX Flow has also allowed integrations with apps like Microsoft Teams, Slack and others to allow users UKG to manage their schedules and shifts inside of the application.
• FleX Insights: Data & Analytics – Comprehensive HCM and WFM data amplified by workplace culture data responsibly to drive outcomes that make workplaces great.
• FleX Fabric: AI and Machine Learning - Intelligent advisor augmenting the HCM experience by guiding people through key moments, backed by data from FleX Insights which will be powered by Gen AI.

Evolving Google and UKG Partnership
UKG has been a partner with Google since 2016. Last year at Aspire it announced that UKG is the only HCM vendor in the Google Marketplace. This has significant impact for clients who have a Google committed spend.  If you have a committed spend of $250k or more, you can purchase UKG products against your Google committed spend.

Very recently it was announced that UKG will apply Google Cloud’s large language models across its HCM suites to deliver more powerful insights to employees and people leaders.

UKG is now an early partner using Google Cloud’s enterprise-grade GenAI and large language models (LLMs) through Vertex AI, building applications for unified search AI and conversational AI. By combining Google Cloud’s LLMs with UKG AI models and Great Place To Work® proprietary data, UKG will create more conversational interactions with its HCM solutions, augment employee requests with more relevant business insights, and support people managers with a deeper understanding of how business decisions can impact employee engagement.

The important thing in all of this is they are not just consuming it like other partners – they are working with Google to influence product which is different than the other competitors

Below is an example of a possible use case for GenAI inside the suite
As an HR leader perhaps you have a goal in place to recruit and hire more women into senior leadership roles. Let’s say that you want to know where you stand today and what actions you need to take to accelerate accomplishing that goal. With GEN AI, you would have a “conversation” with UKG Pro and say “What is the percentage of male/female leaders at the VP level broken down by functional areas (sales, engineering, marketing, etc.). Assuming that you’re still far too low on reaching a goal of 50% women in VP roles you can then ask UKG Pro “Why are we not seeing as many female VP candidates move through the recruitment process to a hire?”.  UKG Pro would then look at how many female candidates you have, how many interviews you have had, and why females are not making it through the funnel, and then provide some guidance to the hiring leaders based on all that analysis.  That advice might come from looking at UKG’s proprietary Great Place To Work data on best practices for hiring female leaders – for example, it might find that you don’t have enough existing female VPs interviewing female candidates and recommend a different interview strategy, it might suggest a better set of conversation topics to have around culture, leadership, inclusion, and belonging, etc.   It might provide a better interview guide for the functional role.   It may suggest changing the way the job is described to attract more candidates. 

As you can see, this is just an example but GenAI will impact all parts of UKG in the future. It will live in existing products and future products. It will also be used to help product development, testing, and future engineering. Finally and very importantly, it will impact UKG support services which should have a large positive impact on your experience as a customer.



Next-Generation User Experience
UKG is launching a new user experience for UKG Pro for both in suite and as well as a mobile app that will launch in the fall. It will combine HCM, Payroll and WFM into a single experience. It will provide a human centric experience that is contextual and personalized to the individual user and puts communications front and center.

The new mobile experience will be contextual, timely and personalized, pushing information,
communications, notifications, and upcoming tasks at just the right time to the individual. It will be smart and helpful, suggesting useful content for people based on past behavior. UKG has shown that it is a nice experience for the user, easy and efficient, designed to empower people to be successful at work.



Below is a summary of key concepts in the new experience coming this fall.


Looking to the future (after the 2 Half release) the app and desktop experience will feature AI-driven insights designed to guide employees to achieve their goals and leaders to support their people.

The other area that they will focus on after the initial release is to decompose applications and build highly personalized experiences with micro frontends – they will be able to pull in 3rd party apps to create truly personalized front ends.

This new experience will no doubt have a very positive impact for employees and managers and provide concise and personalized experiences for all.

New for WFM
UKG is a leader in workforce management solutions – as can be seen in the slide below.



UKG has traditionally had a strong focus on workforce optimization in terms of managing employee availability, optimizing schedules, and collecting time to run payroll.

New Focus on Strategic Workforce Planning
This is new and very powerful – in a nutshell, it involves 3 areas:

• Empower customers to build and visualize budgets and test multiple labor scenarios to respond to dynamically changing conditions.
• Help managers and planners identify workforce skill and capacity gaps over the medium and long term.
• Get insights into current performance and employee mix with AI and algorithmic-based staffing strategy recommendations.

In their fall release, UKG will bring these to the suite.

• Empower managers with AI-driven insights on optimal staffing levels and hiring opportunities (powered by UKG FleX Fabric).
• Evaluate the quality of the Schedule and monitor how changes impact key metrics.
• Help leaders understand the components of the Forecast result and adapt to learnings (Powered by UKG FleX Insights).
• Graphical views of volume data let users understand overall trends at a glance (Powered by UKG FleX Insights).

New for Core HCM
In their current release, there were some key additions to the suite which included:

• Name Pronunciation, making employees feel empowered to add the exact pronunciation of their name on your profile.
• Unified Inbox Enhancements unify the Suite and reduce the steps it takes to review and manage workflow requests
• Improve the Employee Administration experience by delivering top Customer's ideas that increase self-sufficiency.

Fall release updates for Core HCM included these:

• Position Automation to manage your workforce with the flexibility to meet business needs in real-time and have a simple and automated experience for leaders to manage position headcounts, controls, and approvals.
• Editable Workflow to save time and avoid delays by making edits directly in your new hire and termination workflows.
• HR Compliance Requirements to stay compliant with the latest requirements,such as California Pay Reporting;
• Adaptive HCM Experiences which is a modern, flexible, simple-to-configure solution that enables you to adapt Core HCM to the unique needs of their workforce and connect multiple HCM processes into one end-to-end experience. An example of this could be in a retail environment like a grocery store where there needs to be a hiring process for store personnel which can vary by job role (i.e. a cashier would be a different process than a meet inspector or butcher) vs head office personnel. This adaptive experience allows the store manager to participate in the design of the process along with the other team members in HR and payroll to create something custom.

New for Payroll
UKG has a robust payroll presence. Here are the numbers:

• $100B in payment services last year
• 12M W2’s processed
• 7.7M employees paid on average per month
• $13M in total donations in the giving module
• 1.03M employees accessing model my pay
• 13k jurisdictions supported for compliance

Highlights in the current release

• Smart Pay Analytics Enhancements. Recent mid-pay period changes for an employee that impacts the current payroll AI-driven payroll anomaly detection
• Hybrid Work Allocation. Allocate employees to work in multiple locations and automatically split up earnings to be tax appropriately by work location
• Estimate Payrolls. Model a potential bonus, equity amount, and more with Payroll Modeling
• Direct Deposit for Instant Checks. Stay compliant and get checks into employee’s hands sooner with direct deposit for instant checks..

Coming in the fall of 2023

• Search Employees Checks across Pay Groups. Easily locate and edit pays faster with an enhanced employee search
• Year-End Dashboard. Consolidated dashboard with expanded self-service options to prepare and process all year-end forms
• Consolidation of Direct Deposit Files. Save on bank fees by consolidating pays into a single direct deposit file and automating the delivery of the files to your bank

New for Talent
Highlights in the current release

• Integration Improvements. Upgraded connection with LinkedIn for premium job postings and enhanced Indeed Job Feed
• Recruiting Efficiency. Automated phone number verification to shorten time to live for texting and configurable time-outs for candidates and hiring managers
• Enhanced Performance and Feedback Process. Custom Conversation Templates to provide more flexible feedback. New Talent Insights dashboards in BI to monitor Review Process completion.
• Compliance and Reporting Upgrades. 2023 Tax Forms for US and Canada and Canadian Diversity UI, Sync and Import

Coming in the fall of 2023

• Faster Time-to-hire with Interview Scheduling. Self-Scheduling for Candidates with integrated video interviews and a new dashboard for Recruiters. Increased accuracy of Candidate Match.
• Increased configurability for TA processes. Ability to edit offer letters, edit new hires, and quickly consolidate duplicate profiles. Easily collect documentation from new hires through document uploads in Onboarding.
• Performance & Coaching Enhancements. Adding attachments to performance reviews. Increasing feedback requests flexibility.
• Broadening Access to Employee Voice. Streamlined pulse surveys & integration with UKGTalk
• Better Learning Experience with Increase Content. Redesigned user experience & navigation. Content Integration with Udemy and OpenSesame.

UKG’s Approach to Skills
This is a hot area that every HCM vendor has taken an approach to tackling. UKG is approaching this in a unique way in their view.

UKG has introduced a Skills Recency Index™

• One holistic view of skills that factors in both frequency (how often a skill is used) and usage (how recently a skill was used) for a given employee.
• Provides managers with a data-driven, at-a-glance measure of skills as they consider employee eligibility for a shift or new role.
• Advance learning initiatives can ensure certain skills remain ‘evergreen’ by being continuously refreshed and measured to ensure optimal skills coverage across the organization

By marrying the Skills Recency Index™ with the UKG One data platform and a new partnership with Lightcast to get a holistic view of each employee’s set of skills to determine who is qualified to take a particular shift or eligible for a new role. In addition, it provides clear direction on how to tailor learning to each individual to make these skills evergreen.



Recruiting Enhancement
UKG showed us a demo of their new UKG Job Genius which will use Gen AI to help the recruiter automate their tasks when creating a job description, posting the job on various job sites such as LinkedIn and create interview questions for the hiring manager.

The demo was for the recruiter to create a requisition for a design engineer – when creating the job description there is an option to have AI create the job description or perform a bias check or use an existing one. In this case they asked AI to create one. The AI looks in the system and automatically brings in all of the skills that are known to be needed for the job. The recruiter then reviewed them and elected to add one more – SolidWorks – which is a CAD design tool.  The requisition was created with AI and it was smart enough to contextually add CAD Design to the list of skills from seeing the word SolidWorks.

Now that the requisition was saved and posted on the recruiters preferred job sites, he needs to market the job so he clicks on the social media tab where the AI has recommended text and images for various social media sites.

Once finished with marketing, candidates start to pool in, he can go to the interview tab where he can ask AI to create interview questions for himself and the hiring manager. He can review the questions, give feedback to AI to regenerate and so on but he chose to accept the recommendations. It was interesting that the second question asked a question about the skill that he added at the beginning which was SolidWorks.
In summary – this tool is designed to:

• Build quality job descriptions including necessary skills and adjacent skills to make recruiters more efficient
• Automatically build job campaigns for important positions to reduce time to hire
• Assemble dynamic interview guides for hiring managers to create a more consistent interview experience

Great Place to Work Hub



Last November we got our first sneak peek at Great Place to Work Hub. Since that time, the development team has been refining the application based on feedback from industry analysts and clients during their co-discovery sessions. We have now been shown an in-production demo to see where they are at and it is quite something.

In a nutshell, here are the main points:

• This technology is embedded across UKG Pro to help you measure how you are doing based on data seen across the various areas of the suite such as Payroll, WFM, Core HR, and Great Place to Work survey data.
• In addition, Great Place to Work thought leadership and Best Practice learnings are embedded throughout to provide you with tools and insights that guide you and your managers on best ways to improve to become a Great Place to Work
• New Generative AI capabilities provide Actionable guidance

The focus of this hub is focused solely on the HR leaders who are responsible for building the programs at this time. It may at some point trickle down to other levels of management in the future but that is not the focus at the moment.

The initial dashboard for the hub showed all of the various data points around DEIB. In talking with their clients over the past 9 months they know that their customers are clamoring for this data but UKG found that the clients really don’t necessarily have the tools or the understanding of how they want to use the data or read the data to actually make changes to their processes so, UKG is working on providing additional services to read the data, how to understand it and what insights to pull out of it.

Looking at the hub, initially, all of the configurable data is presented as an overview (things like ethnicity, gender, military status, and so on). As well, the Great Place to Work survey data will be on the home page. Then there are configurable tabs like recruiting, development, pay equity, and more where visualizations are shown about the current trends in that particular area. With that, Great Place to Work thought-leadership content specific to that area is served up to help the user to understand in more detail best practices, things that one might want to be considering, and more. One more area on that page is callouts of areas that should be looked at based on the actual results in that particular area.

They are developing an Ask AI component where the HR Leader can populate a question like “How can we make our promotion practices to be fairer” and the Gen AI goes out to all of the content in the entire GPTW library and serves up insights and recommendations specific to the question.

When this product launches, it will be a separate module. The only requirement to purchasing this is that you must have Core HR as a lot of data is pulled from this application. Those clients that purchase the Hub will also get the ability to go through the Great Place to Work certification process. Upon implementation, one of the first things a client will do is to run the GPTW survey so that the survey data populates the Hub along with all of the Core HR data.

For 2024, UKG intends to push out actionable insights across the suite right into specific areas such as when a recruiter opens a job requisition, etc.



My Take
As mentioned in November of 2022, UKG was investing over $500M in product development and as we can see, there is so much innovation now with UKG Flex, all of the components of WFM, Payroll, and Talent not to mention Great Place to Work. With the collaboration with Google to implement Gen AI across all elements of their suites in the near future I can only imagine even more rapid innovation across the suites and improved customer care and satisfaction.