Kronos Surges Ahead in HCM Market with Next-Gen Products, Customer-First Focus, and Award-Winning Culture

June 11, 2019
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By Tim Newnham


In the software industry, having a long history can sometimes be a double-edged sword. On the one hand, you need to be successful to stick around for several decades. On the other hand, the more success you have, the more challenging it can be to keep up with changing market trends, new technologies, and shifting customer priorities. Start-ups first find space in the margins to gain a foothold, then eventually disrupt entire industry.


This phenomenon has a name – it’s called the innovators dilemma. How can an organization prepare for the future when it has such a sizable customer-base that it needs to serve right now? It’s been the Achilles heel for many vendors over the years.


Following the recent Analyst Summit at Kronos Incorporated, it’s apparent that the 42-year-old leader in global workforce management took seriously the challenge from chief executive officer Aron Ain where he tasked the team to create a product that will put Kronos out of business at the time before a start-up could. Kronos has found a formula for success built on next-generation products and an aggressive surge into the $30 billion HCM market space anchored by a culture of caring for employees that empowers innovation.


Being a Great Place to Work is the Foundation for Everything


Ain speaks frequently and candidly about the importance of having a great corporate culture. Great employees have their choice of where they can work, he says, and he expects Kronos to work hard so that they choose Kronos.


Part of this strategy is a brand new, state-of-the-art headquarters in Lowell, Massachusetts.




Kronos relocated from a three-building campus in neighboring suburban Chelmsford to Lowell in 2017, now occupying 600,000 square feet of an office tower complex known locally as Cross Point, but perhaps better known as the former home of Wang Laboratories, one of the original technology companies to put Massachusetts on the map as a high-tech hub.



It opted to make the move – the largest corporate real estate deal in Massachusetts in more than a decade – because leadership, including Ain, wanted to bring all Kronites (how Kronos employees refer to themselves) under one roof to foster closer collaboration at such an important time in the company’s history.



Nice offices are important, but they’re just one part of Kronos’ efforts to offer a high-performing workplace. In addition, Kronos offers a progressive benefits package that includes unlimited time-off (called myTime), extended maternity and paternity leave, student loan repayment and tuition reimbursement, and flexible working arrangements. A manager effectiveness index allows Kronites to grade their managers.



This isn’t an overnight success – Ain and his HR leadership team have been working on it for more than a decade and over the last few years Kronos has won a Best Place to Work award in every country where the organization has a significant footprint. A lot of organizations say they have a great culture, but from interaction with the entire leadership, including Chris Todd, president, Jim Kizielewicz, chief marketing officer, and Bob Hughes, chief customer and strategy officer, it’s obvious everyone is invested in ensuring Kronos continues to be a great place to work for everyone.


The Future of Workforce Management is Kronos


So why all the talk about culture? Because it was that culture that enabled Kronos to introduce Workforce Dimensions.


Workforce Dimensions is the first next-generation workforce management solution. It’s cloud-native, features a responsive design to adapt to whatever device it is being viewed on, and boasts powerful artificial intelligence and machine learning capabilities that help unburden managers and empower employees to drive business success.


Customers think it’s the real-deal too. So far, more than 300 organizations have purchased Workforce Dimensions, with the company expecting more than 1.3 million employees spread across all regions of the world to be actively using the product by the end of calendar 2019.


Kronos is already the leader in workforce management and has recognized there is a significant opportunity to migrate approximately 8,000 customers leveraging its Workforce Central suite (including many who still operate on-prem) to the cloud. Kronos has been shifting to the cloud for some time now, and Chris Todd revealed that subscription revenue recently eclipsed maintenance revenue, an important milestone for Kronos.


Bill Bartow, vice president of global product management, credits four factors with driving interest in Workforce Dimensions: demand for a modern employee experience, transformation technologies like AI and machine earning that allow organizations to rethink labor practices, the emergence of flexible, gig economy-like staffing models, and major replatforming initiatives that demand open technology ecosystems.


Two areas Kronos is investing a lot of time and energy – the introduction of AIMEE, an AI  engine for Managers and Employees which Kronos at launch leverages to deliver machine learning-powered labor volume forecasting and employee self-scheduling, including AI-driven recommendations for swaps and time-off, and its open API Kronos D5 platform, which allows for close-knit integrations with key business applications. This will be a breath of fresh air for organizations that are fed up with clunky, unreliable user interfaces and will further entrench workforce management – where so much operational intelligence is generated – at the center of critical business decision-making.



Bob Hughes, chief customer and strategy officer, shared that Kronos has more than 500 services consultants trained on Workforce Dimensions, which enables the company to handle 300 simultaneous deployments, which will keep installs moving along as demand continues to grow. 


While Kronos wants to sell and implement customers as fast as possible, Hughes also offered the observation that it’s important for an organization to think critically about how the next-gen nature of Workforce Dimensions can help them reimagine their underlying workplace processes to improve the employee experience today and in the future.


Bartow said the market can expect three major feature releases for Workforce Dimensions in the coming year – a cadence established with input from its customers.


Expect to See Kronos in Even More HCM Deals


Kronos first set its sights on the HCM market in 2012 with the modestly sized acquisition of the cloud-native product, SaaShr, which it rebranded and relaunched as Kronos Workforce Ready.  Kronos has rapidly built out its HCM capabilities since then to include a full-suite, end-to-end offering that touches the entire employee lifecycle, including talent acquisition and onboarding, performance and talent management, compensation planning, succession planning, robust workforce management, payroll and payroll services.


Kronos also now offers Workforce Dimensions HCM, which offers the same HR and payroll modules, but different workforce management capabilities. Kronos provides guidance to customers on which suite may be right for them: for those with complex or industry-specific workforce management needs, the choice should be Workforce Dimensions HCM; for those with less complex workforce needs, consider Workforce Ready.


The introduction of Workforce Dimensions HCM has already started to push Kronos further up-market in the mid-market space. Average deal size is growing, and it says it’s now capable of comfortably supporting HCM customers with up to 10,000 employees, or even more depending on the complexity of their HR needs.


One reason for the traction Kronos has generated over the last couple of years, it says, is that more organizations are recognizing the importance of putting workforce management at the center of their HCM strategy. Workforce management, according to Bob DelPonte, vice president and general manager of the HCM practice at Kronos, is where an organization generates all its people data. It’s stored in the HR application, and then applied to payroll to calculate earnings and pay. Organizations that want better analytics and more accurate payroll increasingly recognize that starts with workforce management. As they take a closer look at workforce management, they recognize Kronos is the leader.


With that in mind, Jim Kizielewicz, chief marketing officer, says Kronos is pleased with its win rate in HCM deals. He says the key to growing its HCM business even faster isn’t increasing its healthy win rate, but rather, getting more “at bats.”  Simply put – Kronos recognizes that its still viewed as a workforce management provider, which is generally purchased by the operations portion of a business. HCM is purchased by HR and payroll, and as such, Kronos is often not considered despite the innovative work it is doing around performance management and people analytics.


Kizielewicz says when Kronos gets an “at bat” in an HCM deal, it often wins for all the above reasons, so it has embarked on an aggressive awareness campaign that includes more radio commercials and pre-roll video ads (which he says are decidedly and intentionally “not what you’d expect from Kronos”), as well as the sponsorships of nine up-and-coming PGA and LPGA golfers.




Kronos also brings a potential competitive advantage to the HCM market. The first – it goes to market by industry. Kronos focuses on, in no particular order, healthcare, manufacturing, public sector (including public safety, state/municipal government, and public education), retail, and services/distribution (including financial services, logistics, staffing.) This means its sales reps only sell into their assigned vertical, and as such, have a deep understanding of the challenges an organization faces every day. In addition, its services teams also implement and support customers by vertical, so that means their teams are not implementing a manufacturer this week and a healthcare provider next week.


What’s Next for Kronos? Execution

During Analyst Summit, Ain and Todd were both upfront about what to expect from Kronos in the short-term. They said they’ll continue to innovate (and Bartow confidentially shared several examples of how they will do that with Workforce Dimensions), but will spend the next year wholly focused on executing. Executing on selling and implementing Workforce Dimensions and executing its HCM awareness urge to ensure Kronos is on the shortlist of as many HCM deals as possible.


Kronos has a long track record of executing – when the company has set its mind on doing something, whether it was computerizing the timeclock way back in the early 80s, introducing web-based workforce management in the 90s, or its more recent shift to the cloud, it has always successfully executed.


With that in mind, the HCM market is going to be a very interesting space to watch over the next couple of years as Kronos, long regarded as the 800-pound gorilla in the global workforce management space, applies its focus on innovation and industry-specific knowledge to the HCM space.


Kronos Surges Ahead in HCM Market with Next-Gen Products, Customer-First Focus, and Award-Winning Culture
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