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Investments in technology require scale

30 July 2021

SD Worx has plans to become the largest European provider of payroll processing and HR services by the year 2025. Their strategy, aimed at a further scaling up, focuses on internationalisation and digitisation. The takeover of Swedish Aditro is the perfect example of how SD Worx is pursuing this goal.

Aditro is a major player in Northern Europe in payroll and HR services, just as SD Worx is in Belgium. The most important difference is that the Scandinavians key into the needs of local customers and users with large numbers of functionalities via smartphones and the cloud. “In that respect, the Swedes, Norwegians and Finns have progressed further than we have. The takeover not only enables us to expand our geographical presence, but also consolidate our technological expertise”, says Dominique Tassent, who is responsible for the market for Belgian companies with over 100 employees.

The necessity to offer increasingly digital services to companies and their employees is the basic principle behind this growth strategy. SD Worx is developing these applications centrally and will then roll them out in the organisations in the various countries. The scale advantage offers a solution for supporting the significant investments and distributing them among large numbers of users. All the same, there are several limitations to this uniform approach. “Everyone knows that salary calculations are bound by regulations and legislation, often on the regional and local levels. These payroll applications will always be locally hosted. But the fact remains that a large number of background processes are universal, so we develop them all in one go for all the countries in which we are located. To simplify that process, we increasingly use artificial intelligence. This in turn enables us once again to achieve a scale advantage”, explains Tassent.

International expansion

SD Worx is active in Belgium, Luxembourg, France, Germany, Netherlands, United Kingdom, Austria, Ireland, Spain, Switzerland, and Mauritius. And the company can continue to grow organically in all of those countries. “In Belgium, we are in complete control of the entire range of payroll and HR services. We can also offer a number of these to the other countries. At the same time, we are fully aware that we cannot be best in every single area, which is why we work closely with partners. Our current focus is strongly on market leadership in Europe, where we already rank among the top three in our field. For countries on other continents, we work closely with colleagues with a focus similar to ours. A company with a few European branches and one in Tunisia, for instance, can always count on our full support. Our approach lets us cover over 75 countries”, says Tassent.

Aditro, the most recent major takeover of SD Worx, was also a partner in that network. The company is now looking for new candidates within that ecosystem, as well as in Southern and Eastern Europe. SD Worx is already active in Spain and Poland. “In Malaga, we acquired a branch through the takeover of Adessa. There, we offer support to customers with SAP HCM and SuccessFactors HR software, but naturally it also provides direct access to potential customers for our core services, namely payroll. In Poland, we have a development centre for our software and have already started rolling out our services for international customers who operate there. After the rollout, we will start exploring opportunities in the local market.”

Tech

As a workforce management company, SD Worx has also pressed ahead with its own development of software for salary calculations and the technology for automating and optimising HR processes. “Most of our customers outsource their salary calculations to us to some extent. In Belgium, the majority of organisations assume responsibility for part of the process and purchase a selection of Managed Payroll Services from us, while others prefer Full Business Process Outsourcing, with SD Worx handling the entire process. We expect European customers to opt increasingly for Software as a Service (SaaS).”

That core competency is now part of a package of solutions that SD Worx sums up as ‘5 x 4’. This entails services as part of the five steps in an employee journey: recruitment, onboarding, payroll & reward calculation & payment, workforce management and talent development. There are four categories within the range: software products, services, expertise and data. “Services and expertise are increasingly important. A quarter of our employees in Belgium are now consultants who assist customers with their projects. This sometimes involves highly specialised services and knowledge, such as tax consulting for expats. In addition, customers want an immediate overview of total personnel costs, including temporary employees, student employees, consultants and freelancers, in order to optimise as much as possible. This provides them with insight into the impact of merger plans, for instance, beforehand. That functionality is offered by Pointlogic, which was acquired last year.”

Mobile

The HR process revolves increasingly around providing employees with relevant information. Most people prefer to use their smartphone for this. And the countries in Northern Europe are showing the way. “SD Worx has already taken the necessary steps in that direction. Our Digital Assistance Service now has more than 280,000 users, a number we hope to boost quickly. We can achieve this by continuously adding new functionalities. We have started with pay slips, but are now expanding to various communication tools, time registration systems, parking or workstation reservations, and so on. This process will absolutely entail the mutualisation of the knowledge and experience of both SD Worx and Aditro.”


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Organised by: HRmagazine & Scale-ups.eu