£100m a year HCM business to be called Access People now created
On 5 March 2020, Access Group announced a definitive agreement to acquire CoreHR, creating a UK & Ireland (UK&I) centric HCM business to be called Access People, turning over in excess of £100m a year. CoreHR’s CEO, Dean Forbes, is to become President of the Access People Division. What’s the impact? Here’s our Fosway analyst take.
It’s obviously acquisition season (see other Fosway First Takes), but Access Group has been on a very active acquisition strategy in the HR and learning market for a couple of years. As well as recently acquiring PeopleHR, it has also made multiple acquisitions in its digital learning and compliance business, including Unicorn, Safety Media and MicroLearn.
Under the leadership of CEO Dean Forbes, CoreHR has been on its own transformation journey over the past couple of years; shaking off its legacy on-premise HR/payroll-centricity and reinventing itself as a modern Cloud HCM suite. It has also focused heavily on improving its customer experience/advocacy and via partnerships, extended the DNA of the solution to strengthen the suite of capabilities, especially around HR helpdesk, talent and learning.
What’s to like?
The acquisition of CoreHR significantly strengthens Access’s play in the mid-enterprise HR market, nicely complementing its existing capabilities with SelectHR in the mid-market, and PeopleHR for small businesses (SMB). The acquisition also strengthens Access’s opportunity into the Irish market, leveraging CoreHR’s strong payroll position. It’s also a protective move against further consolidation in the SMB and mid-market HCM players, as well as potential new entrants from the US and Europe.
As a consequence, Access now has a clearly delineated offering at enterprise, mid-market and SMB level with the different product lines, with an ability to then cross-sell other capabilities (such as learning and content) across the portfolio. Also, from a branding perspective, Access People seems a much more focused and workable name, rather than just sticking the word Access on the front of everything else, as has maybe been the case previously.
From a CoreHR perspective, being part of Access Group gives it a clear future trajectory in a fast-growing business and provides access to complementary technologies and solutions to further build out its offering. Most significantly, it also means it now has the financial muscle to grow market presence beyond its legacy markets and strengthen its enterprise credentials with, we assume, further acquisitions in areas where CoreHR historically lacked native capability, e.g. in learning and recruiting.
What’s not to like?
From our perspective, relatively little.
Access People’s product landscape is complex, with multiple solutions and its associated R&D investment to maintain and develop. That will need to be simplified over time – and one assumes there will be attempts to generate greater cost synergies in overlapping capability areas. But that comes with any acquisition.
One potential concern is Access People’s limited geographic focus. Whilst the addressable market in the UK&I is more than big enough to justify the size of the business and the size of their investment, the more the CoreHR sub-business is pushed to focus purely on enterprise-size customers, the more those customers are likely to be multinational in their DNA. Access People needs to step up to that challenge, both in terms of product roadmap and scope of capability. But also in its ability to serve multi-national enterprise customers better. That will also mean clear answers or alliances for non-UK&I payroll, as well as enhancing functionality to support multi-national deployment and configuration.
With SAP, Workday, and Oracle also increasingly focusing on the mid-enterprise Cloud HCM segment, and Ceridian and now potentially Ultimate/Kronos also engaging more in EMEA (often via the UK first), the mid-enterprise space is only going to get more competitive.
Read the full press release here.
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