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This HR Tech newsletter explores industry trends with a focus on acquisitions, layoffs, and innovation. It covers UKG's workforce reduction, consolidation in benefits brokers, the Deel vs Rippling race, SHRM's shift in DEI strategy, and Lattice's controversial AI announcement.
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Welcome to this month's edition of our HR Tech newsletter.
Instead of focusing on a single theme this month, we wanted to explore a wide variety of stories and significant developments in the HR tech landscape.
From a slew of acquisitions to a strange product announcement, here's what's making waves:
What's Happening: In by far the biggest HR Tech story of the summer, news trickled out on July 3rd that UKG announced they would be laying off over 2,000 employees. Why announce layoffs the day before a holiday? Rumor is: That timing was not the plan at all; but FedEx sent offboarding boxes to the homes of terminated employees a week earlier than anticipated.
Why It Matters: For one, 2,000 great people in our industry are now looking for work. And, there is a broader story here about the state of enterprise software. A software buying slowdown has been simmering for over a year as buyers continue to proceed with caution, elongating sales cycles and showing more willingness to stay with their existing solutions. UKG says they will focus on investments in product innovation, enhanced customer experiences and Gen AI going forward.
What's Happening: One of OutSail's earliest benefit broker partners, The Horton Group, announced they were going to be acquired by Marsh McLennan Agency (MMA) after 50+ years of independence. A few weeks earlier, OperationsInc - one of the nation's leading HR consulting organizations - announced that they were becoming a part of Gallagher.
Why It Matters: Consolidation, consolidation and more consolidation. The throughline in the employee benefits broker world almost always comes back to the big getting bigger. Gallagher's acquisition of OperationsInc is particularly notable, especially on the heels of a similar acquisition last year of Triad by One Digital. It is clear that employers are looking for more hands-on HR consulting support from their broker partners.
What's Happening: Just this morning, Deel announced the acquisition of Hofy, a global device management platform. This product, now called Deel IT, will enable global employers to onboard employees anywhere in the world with computers & devices pre-loaded with business apps. If that type of solution sounds familiar, you might be thinking of Rippling's device management and IT services capabilities.
Why It Matters: Rippling and Deel are the two most highly-funded and ambitious companies in the HR Tech world, and frankly they aren't even pretending that they aren't competitors anymore. Rippling saw Deel's success in global payroll & EOR and launched a moonshot project to build their own global employment network. And simultaneously, Deel recognized their HR Management gaps and has been on an acquisition spree ever since.
What's Happening: SHRM made a surprising statement last week when they announced they would be dropping 'equity' from their DEI strategy and instead only focusing on Inclusion and Diversity (I&D). This announcement came at a time that many companies, such as Microsoft, CNN and Tractor Supply, are abandoning their own DEI work.
Why It Matters: Some of the most popular voices in the HR world expressed immense displeasure with SHRM's decision. SHRM has been under fire for years as critics have suggested that the organization is perhaps losing its pulse on the real feelings of its constituents. And many upstart HR communities were happy to open their doors to frustrated SHRM members these past few weeks
What's Happening: Lattice's new CEO, Sarah Franklin, announced last week that Lattice "made history" by becoming the first company to create digital employment records for AI employees. Yes, you read that right. Lattice is putting chatbots into org charts and even allowing for performance plans to be assigned to "digital workers."
Why It Matters: It's important to remember that Lattice was founded by Jack Altman, who is the little brother of ChatGPT founder, Sam Altman. So it's not all that surprising that Lattice would be all aboard the AI hype train. Maybe this announcement will be seen as forward thinking, but if AI doesn't deliver on his promise, this is sure to be one of those stories we'll look back on for years
