Podcast: Aaron Smith, ADP’s SVP of Product Development

Night Meeting

Transcript

Mark:

Welcome to PeopleTech, the podcast of the HCM Technology Report. I’m Mark Feffer. Recently, I heard someone say that workers will define the future of work. That’s an interesting notion, especially when so many workers feel empowered to jump from their current jobs, even if they don’t have something new lined up. We’re going to explore that and more with our guests today, Aaron Smith, senior vice president of product development at ADP, on this addition of PeopleTech. Aaron, welcome.

Aaron:

Great to be here.

Mark:

And thanks for coming. So I’ve been reading what ADP has just published about trends in HR and HR technology. And it was really some interesting stuff in there. One of the things that struck me was an area that talked about workers will define the future of work. And honestly, that sounds a little bit like HR establishment speak. It’s definitely a break with the past. But why do you think this time will be different? Why will workers have such influence?

Aaron:

Right. I think what we’re seeing is nobody really has the perfect definition of what work is going to look like next year, the year after, post-pandemic or even beyond. And I think taking a different view of it from the talent that’s on the ground doing the physical work is a way that we’ve identified patterns and the ability to shift left and shift right in how work is getting done and how you’re operating within a team as well, at a much more organic pace versus responding to shift in work patterns that might be because of a surprising pandemic, as an example or another event.

Aaron:

So what we’re seeing in the data that we’re really excited about, Mark, is the fluidity and the dynamics of how you’re really unlocking talent for the outcomes you’re trying to achieve is not a fixed formula, and where we’re going to at the ground level, both with data, but also with our talent is listening and having the ability to interpret and potentially pivot work patterns based upon what our own talent is telling us. That’s giving us that fluidity that we’re looking for in much of what is probably still a yet to be defined set of work patterns two, three, four years from now. And that’s just kind of how we’re seeing the evolution of it. We don’t know the perfect answers, but we’re learning a lot, not just with the data, but the talent within our company as well, and how to navigate.

Mark:

Well, does all this indicate that the changing dynamics of the labor market and the changing dynamics of business are putting workers in a better position to, I don’t want to say dictate the terms of their employment, but to influence the terms of their employment?

Aaron:

I love that last term. I would say it’s a very heavy level of positive and very valuable influence that the workforce is having on this. Somebody asked me the other day, “Does that mean talent is driving? Does that mean talent is dictating our direction?” And I would say, there’s probably a balance of where we’re really doubling down on good insights and decisions that our talent is giving us. But I would probably use something that I tend to reference more of is a very positive, a very valuable set of influence and characteristics and interest and ideas that are coming from our workforce.

Aaron:

And by the way, some of unlocking, what we’ve seen, some of the best way to unlock a lot of your best talent is don’t put them in a position where they feel like they are the decision maker. Put them in a position where you can capitalize on their strengths and then add and surround really additional strong factors of what could be a seed of a good idea. That’s really where we’ve seen the real unlocking of some strengths within our talent base as well. Put them in a position to let them really influence and then surround them with other strengths that might potentially capitalize on that idea further.

Mark:

Okay. Now I want to shift gears slightly, though still stay in the worker’s camp as it were. The great resignation, which everyone’s talking about. I don’t know if you like the label or not, but why do so many workers feel empowered to leave their company in an economy that’s not great and when a lot of them don’t have a job lined up before they go?

Aaron:

I think there’s obviously a lot of perhaps personal economic factors. That’s one aspect. I tend to really try to reflect back that there are always going to be a level of personal and economic factors that go into some of the decisions that individuals might make within their career. The other interesting aspect that I think about, Mark, on a daily basis in fact, is really what’s at the heart of an individual’s aspirations perhaps, or interest in expanding and growing their career? And there’s a lot of variations of what someone might be looking for in growing their career. But the one that I really enjoy seeing flower now more than anything else is identifying where an individual has not had the opportunity to expand their career potential beyond their individual job description. And so, when I’m looking at really talent that’s either coming into the organization or perhaps making a decision to make a change, I love going after that question.

Aaron:

I would love to ask somebody, throw away the job description. What are you passionate about? What’s your energy? What do you want to come in doing every single day? And I believe one of the unlocked secrets is really capitalizing on that unexposed interest that reaches beyond an individual job description. And I do know that we’ve had individuals that perhaps might make the assumption that perhaps at ADP or another company, they might be determined, they might be thinking about leaving. They might make an assumption that that opportunity does not exist as far as the walls of the job description and the role that they have, because the conversation is being had at an individual job or job description level. It’s not saying, “What are you passionate about? What do you enjoy doing what? What do you think?”

Aaron:

And then by the way, as a large organization, as we are, I’m not shy of any opportunities to be able to really capitalize on taking advantage of those interests and those strengths. And that’s a change in conversation in my mind that is so powerful to unlock versus the first topic I mentioned, which would be perhaps personal economic decisions that could go into some factors of people’s decision to make a change.

Mark:

Do you think this is a long term thing, that the idea of, what is it, 25% of the workforce is turning over 4.4 million and 400,000 users in September? Is this a new dynamic that’s going to be with our work environment for a while?

Aaron:

I do believe that this is going to become a new relative level of change that we’ve achieved here. And by the way, if you look at some of the history of economics and workforce dynamics, even going back 25, 30 years ago, you can see that bar adjust in increments of five years, 10 years, 15 years, as far as the likelihood of variability in your workforce. I mean, if you take a look at some of the opportunities that existed back in 1980, 1985, you had some levels of stability depending upon economic milestones.

Aaron:

I believe, Mark, that the relative bar of the amount of variability in the changing workforce has reached a new level and is going to have some sustainability to it. And I also like thinking that way, because if you do think in that direction of expecting the level of variability to sustain itself, then you as a company and how to unlock your talent, it’s always going to keep your perspective fresh and open with being able to come up with new ways and new patterns and new ideas to work within that high level of variability. Because if I reset my mindset with the assumption that it’s going to go back to where it was 20 years ago, I truly believe we’re probably not going to unlock the best talent or even bring the best talent into our organization.

Mark:

I wanted to shift again and talk about data. It plays a pretty big role in the report. You talk an awful lot about it, and data’s been a common theme in HR for a number of years. How would you describe the way employers work with data? I mean, do managers have the knowledge they need to take advantage of it to the point they should when they’re dealing with the workforce or their teams.

Aaron:

So, what we’ve seen. We do love, we love talking about data. We absolutely love it. I think what we’ve seen from a historical perspective, and not just us but even competitors perhaps, or other technology organizations, is historically, pre-pandemic let’s just say, we offer a significant amount of coaching and knowledge to our clients on how to use data We have a significant amount of training exercises, a lot of how a client is able to interpret and drive continuous decisions based upon the data. And what we found historically is that skillset has not historically been a regular skillset within a lot of our clients, to be able to know how to interpret the data. And we’ve supplemented that with training and knowledge.

Aaron:

What I’m seeing and finding now is clients are actually, you could call it based on the pandemic or you could call it a factor that the talent challenges that exist is, what I’m finding more and more clients that are more eager and more interested to go to that second and third level interpretation of the data with us, naturally. They’re starting to learn that technology opportunity and that data opportunity versus if I go back to the beginning, many of our competitors and technology companies, and even ourselves, we’re having to walk in and explain data. We’re having to explain the basic mechanics of using, consuming, and analyzing and interpreting the data. I’m now seeing a high, high interest, aptitude, willingness, and eagerness to go into the data. And that’s where we, ADP, we just feel so excited about it because it’s been an untapped opportunity based upon that other element, other than just us teaching and coaching. We’re now seeing the, let’s grab it, let’s work with our clients, let’s partner, and let’s really unlock what those decisions are going forward.

Mark:

Now, you’ve obviously spent a lot of time thinking about HR and HR technology. We’re moving toward the end of the year now, as we’re recording this, what do you see happening in that world in 2022?

Aaron:

From a product and technology perspective for HR?

Mark:

Mm-hmm (affirmative).

Aaron:

So the first pattern that we identified and we noted in our release as well, that I absolutely love, is a little bit similar to what I just described on the data side, but I’ll transition it to how our clients are leveraging technology, our technology and other technology, but in our case, mobile. It’s amazing to see the natural behaviors that are now coming into the workforce with more of excited adoption of channels that historically we’ve really tried to coach and push into our client base. And mobile’s been one of them. It’s been perhaps, a certain industry for a client is not to interested or adapt at using mobile. What we saw is a hockey stick move, perhaps a function of the pandemic as well, to now being eagerly adopting channels like mobile. And I believe the connection of that into HR connecting into the consumerized pattern of adopting technology is just come closer and closer and closer together in the last 12 months, it’s been amazing.

Aaron:

And our data says it just by itself. We didn’t exactly send out a large campaign, Mark, during the pandemic to go and use our mobile app. It exploded positively on us. And I believe at the end of this year and into next year, we’re going to now be identifying even more and more organic adoption of technology channels by our client’s employees. And we love it. We’re really excited about that because it doesn’t require a campaign. It’s just natural, eager adoption of those technology channels within HR. Now, it’s going to put even more expectation on us to be innovative, to be looking at how to adopt the technology in the eyes of our clients and our users, so that we are predicting patterns ahead of how to unlock the productivity of technology. But we love that pressure and we’re all in on it.

Mark:

Which segues really nicely to my last question. All those changes coming in 2022, how is ADP positioned for them? How are you going to face that environment?

Aaron:

Right. So I will give you three very critical, positively critical initiatives that we are heavily invested and focused in. One is the evolution of talent tech technology. By default, because of our underlying data, there’s a lot of various talent offers out there within the HCM ecosystem, performance management and compensation. But historically the way that technology is looked at as is a set of pillar of capabilities. We’re not looking at it that way anymore. We’re looking at it horizontally. So our talent technology has really come to life in what we’re going to be focusing on in 2022, Mark. And looking at talent as a journey and not on a pillar by pillar, by pillar basis, so that’s number one.

Aaron:

Number two, we talked about it. We are continuing to take our data and our data platforms to the next level. So we’ve obviously got data cloud here at ADP that has been a massive success for our clients and for our market, both from client data intelligence, but also industry bench marketing capabilities. And we’re doubling down on that with how the introduction of AIML on top of our data platforms is now really unlocking those predictive journeys that I mentioned earlier, that I know our clients are going to be eager for. So, that’s number two.

Aaron:

And then number three is really experience. And you could say user experience, you could say associate or employee experience. You could say client experience, you just have to expect that is going to have to be a daily evolution and not a yearly revolution. And the difference between the two is many technology companies go through an evolution. We have as well, where we look back and we say, “How would we reimagine our experience?” And you end up in a multiyear cycle in looking at it that way. We’re not doing that. In 2022, we’re going down to a micro level on what experiences matter the most for users, clients, and their employees, and expect to be able to pivot on the day or on week where the experience is not being the most productive for your clients. And we believe that third initiative is something you have to live and breathe in your fabric every day. You will not succeed in technology by looking at this like many companies have, and we did as well many years ago on a very anular or a very elongated cyclical basis.

Mark:

Aaron, thanks for taking the time to talk with me today.

Aaron:

Great. Enjoyed it, Mark. Thank you.

Mark:

My guest today has been Aaron Smith, senior vice president of product development at ADP. And this has been PeopleTech, the podcast of the HCM Technology Report. We’re a publication of Recruiting Daily. We’re also a part of Evergreen podcasts.

Mark:

To see all of their programs visit www.evergreenpodcasts.com. And to keep up with HR technology, visit the HCM Technology Report every day. We’re the most trusted source of news in the HR tech industry. Find us at www.hcmtechnologyreport.com. I’m Mark Feffer.

Image: iStock

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