SaaS Whitepaper

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The Top Four Reasons Why So Many Companies Are Selecting SaaS for the

Most Efficient and Convenient Human Capital Management

WWW.ULTIMATESOFTWARE.COM

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©2008 Ultimate Software Group, Inc. All rights reserved. The information contained in this document is proprietary and confidential to The Ultimate Software Group, Inc. No part of this document may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, for any purpose without the express written permission of The Ultimate Software Group, Inc. No part of this document may be extracted and/or used out of the context of the full published document for any reason. This document is for informational purposes only and is subject to change without notice. Ultimate Software makes no warranties, express or implied, with respect to this document or any statements contained therein and specifically disclaims any warranties including but not limited to those for a particular purpose. This document contains or may contain statements of future direction concerning possible functionality for Ultimate Software’s products and technology. Ultimate Software disclaims any express or implied commitment to deliver functionality or software unless or until actual shipment of the functionality or software occurs. UltiPro is a registered trademark of The Ultimate Software Group, Inc. All other trademarks referenced are the property of their respective owners. Revised January 2010.

2000 Ultimate Way Weston, FL 33326 1 800-432-1729 www.ultimatesoftware.com

Ultimate Software Proprietary and Confidential ii

Table of Contents Introduction ....................................................................................................... 1 What Is Software-as-a-Service (SaaS)? ........................................................... 2 SaaS: How It Works .......................................................................................... 3 For Every Company, Large and Small .............................................................. 5 Benefits and Business Value for Entire Organization ....................................... 6 Sample Feature Sets of UltiPro through SaaS ................................................. 7 Top Benefits

In-House Control with Outsourced Convenience ...................................... 8 Return on Investment ................................................................................. 9 Best-in-Class Technology with Peace-of-Mind Security........................... 11 Award-Winning, Expert Service ................................................................ 13

Summary ......................................................................................................... 14

Ultimate Software Proprietary and Confidential 1

A December 2008 survey by Gartner found that the nearly 90% of organizations are planning to maintain or increase their usage of SaaS solutions for the following reasons: 1) More cost-effective from a TCO standpoint than on-premise solutions 2) Easier and/or faster to deploy than on-premise solutions 3) Lack of IT resources necessary to implement an on-premise solution Gartner Report User Survey Analysis: Software as a Service, Enterprise Application Markets, Worldwide, 2008 December 2008 Gartner expects the SaaS market to grow at average annual rates of 19.4% through 2013—far above the 5.2% growth for the overall business management software market. Gartner.com Market Trends: Software as a Service, Worldwide, 2008-2013 May 2009 IDC states the percentage of U.S. firms which plan to spend at least 25% of their IT budgets on SaaS applications will increase from 23% in 2008 to nearly 45% in 2010. IDC Study Economic Crisis Response: Worldwide Software as a Service Forecast Update November 2008

Introduction From payroll to benefits to more complex HR compliance, managing human resources is a multi-faceted responsibility—and more and more crucial in the competition for hiring and retaining good employees. More than ever before, human resources professionals need to streamline HR functions and channel more energy into developing and retaining top talent. To stay competitive, they need superior systems and strategies already proven to positively impact business success. Today, the most organized, efficient, strategic, and cost-effective approach to HR, payroll, and talent management is Software-as-a-Service (SaaS), a means of delivering a software solution online. In addition to the competition for top talent, the contemporary workplace is changing. Of the companies selected for Fortune magazine’s 100 Best Companies to Work For 2009 list, 82 allow employees to telecommute or work at home at least 20% of the time, a trend that is gaining steady momentum since 1998 when the list had only 18 companies allowing employees to telecommute. Top talent will seek similar options when comparing and considering a workplace. The increased focus on results-based work and the mobility of employees due to travel and remote work, plus the need to provide the best tools for employee satisfaction, necessitate convenient, flexible workforce management tools that can be accessed anytime and anywhere. Ultimate Software, a leading provider of HR, payroll, and talent management solutions provides Web-based, on-demand SaaS for UltiPro—Ultimate’s human capital management (HCM) solution. As an industry leader in SaaS-delivered HCM, Ultimate Software explains in this paper why more and more companies are choosing SaaS as the most advanced, yet easy and highly efficient, approach to managing HR, payroll, and talent management.


“Coming from a service bureau environment, we believe that SaaS makes a lot of sense for us from a business standpoint. With SaaS, we can experience the control, flexibility, and functionality of an in-house solution, without tapping into our internal resources for a new workforce management solution.” Laurie Leblanc Assistant Director of Compensation and Benefits Harvard Business School Publishing “UltiPro’s benefits-enrollment feature set has shaved two to three weeks off of our open enrollment process because there are no mailings to prepare or massive amounts of data for us to enter by hand. Conducting our annual benefits enrollment online is also great because we have hundreds of employees in remote locations.” Kathy George Payroll Manager Nikon, Inc.

What Is Software-as-a-Service? Software-as-a-Service is a method of providing comprehensive software applications through a secure Internet browser. Rather than buying and owning the software, which requires up-front capital, in-house IT resources and maintenance, and often complex training, a company uses the software for a subscription fee, while the applications and resulting data are stored and protected by a secure, remote host. There are many different SaaS systems in use today that companies rely upon to drive mission-critical functions, such as customer relationship management, customer ordering, accounting/finance, supply chain management and, the focus of this report, HR systems, which includes, for example, employee data, payroll processing, benefits administration, recruiting, performance management, time and attendance, strategic workforce analysis, and organizational planning. According to Stamford, CT-based research firm Gartner Inc., the global SaaS market is expected to grow to $19.3 billion by 2011, tripling in size from the $6.3 billion it was in 2006. Ultimate Software developed its SaaS model to deliver the best in convenience, affordability, and efficiency to customers. In 2008, more than 70% of Ultimate Software’s new customers chose SaaS as the preferred method of using UltiPro to manage HR and payroll. Companies previously using traditional in-house methods or external service bureaus for their HR functions cite a host of benefits in progressing to UltiPro via SaaS:

• Convenience and 24-7 Web-access from anywhere • Expert system maintenance, management, and upgrades without

dedicated in-house IT resources and complex training • Greater functionality than licensed software or service bureau • Greater responsiveness and control in managing employee data and

processes • Improved strategic planning and decision making • Freedom from following specific service bureau schedules • Instant, current data analysis and reports—anywhere, anytime • Cost savings and measurable return on investment • More efficient, leaving more time to focus on a company’s core business

objectives • Proven security and confidentiality of employee data • Ability to leverage and use latest technologies without having to support

them internally


“With SaaS, Ultimate Software oversees the tape backups, necessary testing, and other IT elements that companies are expected to have to stay in compliance with Sarbanes-Oxley. It made sense from a resource perspective for us to give Ultimate Software those responsibilities than for us to make additional investments.” Vince Pepenelli Senior Manager of HR Constar

Software-as-a-Service: How It Works Anytime/Anywhere Access. With UltiPro’s SaaS, HR administrators have every HR function organized into one application, accessible anytime, 24-7, from anywhere there is an Internet connection—office , home, or on the road. But the efficiency, convenience and benefits of SaaS-delivered UltiPro extend beyond the HR department. Managers and employees—any designated user—can access the self-service features of UltiPro. Tasks once administered by an HR team, like updating employee information, logging paid time off, changing benefits data, reviewing compensation or performance review history, or running reports and analytics, are self-administered through SaaS. Managers and employees can access UltiPro with the same around-the-clock convenience. They gain greater control, and HR staff recovers hundreds of hours once spent updating and inputting information and answering employee and manager inquiries. Licensed software resides on a company’s in-house server and requires in-house hardware, maintenance, and support. With SaaS, Ultimate Software houses the technology and applications in its secure, hardened data center and provides 24-7 service, support, maintenance, upgrades, and safe data storage. There’s no large, up-front capital expenditure, and companies lacking technical infrastructure or investment dollars can get the same leading-edge technology and HR management tools as larger firms. It’s the most business value at the most affordable price. With two hardened, secure, SAS70-compliant facilities—an FEMA Class 1-rated facility in Miami, built to withstand fires, natural disasters, power outages, sabotage, and theft, and a center in Atlanta with 24-7 security and N+1 Redundancy on all critical systems—SaaS customers benefit from advanced disaster protection and recovery.

Below is a high-level view of how Ultimate’s SaaS works. See a detailed security diagram on page 12.

Because hundreds of companies, many with thousands of employees, trust Ultimate Software to manage their most confidential data, the company has mastered and practices all proactive security steps and procedures to assure seamless, worry-free user performance. Ultimate Software:


1. Became the first HR/payroll Software-as-a-Service provider to be awarded the

ISO/IEC 27001:2005 Certification in January 2008. This certification validates that Ultimate Software implemented a sound and secure information security management system for the SaaS environment.

2. Completed SAS-70 Type II audits. This stringent annual procedure ensures that a SaaS provider has been scrutinized carefully by independent auditors and is following all proper security processes.

3. Earned a Safe Harbor certificate from the Department of Commerce. This

published privacy policy ensures the team has employed pre-defined procedures around privacy and is adhering to good business standards.

4. Extensive security experience. Ultimate Software’s enduring security history is

the reason SaaS is far superior to almost any in-house system. A seasoned SaaS provider with numerous corporate clients has a proven track record of overseeing and administering system protection for a variety and multitude of applications.

Ultimate Software conducts Network Penetration Testing (NPT) regularly. These tests by third-party auditors assess security in every component of a SaaS network by testing and identifying potential vulnerabilities. The company has road tested and perfected many times over all of the significant security functions. As experts with so many corporate clients trusting them to safeguard and protect data around the clock, without fail, they are at the forefront of leading-edge security practices. Ultimate Software employs a full-time staff of security experts, accredited as Certified Information Security Professionals (CISSP). “CISSP” indicates rigorous industry testing and signifies a more elevated skill set in information-security and related best practices. The structurally hardened and reinforced buildings for storing the UltiPro databases have:

• Securely locked enclosures where the servers are located • Fully redundant power, cooling, and communication systems • Technologies such as bio-metric security systems • Video surveillance and a dedicated 24-7 security staff

In addition, a nightly back up of all of your HR, benefits, and payroll data, including all employee records and historical data, is encrypted, put on tape, and sent to an off-site storage facility. This can be used to restore your UltiPro system to another facility, further ensuring business continuity. In 2007, Ultimate Software’s IT team received the first-place Best IT Team award from the America Business Awards. With UltiPro through SaaS, you have peace of mind knowing that your solution is in the most experienced hands and remains protected.


“With the service bureau, we had a small window of time to submit our payroll data and even less time to ensure its accuracy. With all of the manual effort that used to be required, payroll used to take me a whole week and now it takes a half day.” Tom Short Payroll Specialist Oncology and Hematology Care “UltiPro’s functionality for performance management is becoming a key component of our talent management strategy. The solution is empowering us with the ability to streamline our employee review process, better identify employee competencies, analyze areas where we need employee development, and improve overall satisfaction.” Carol Summersgill Vice President of Human Resources Therma-Tru Doors

For Every Company, Large and Small Depending upon the size of your company, the number of employees, the available resources and capital, the presence or lack of a dedicated human resources team, and your knowledge of available human resources management systems, you may currently manage your human resources in a number of ways. The most basic and traditional means is completely in-house, with or without the advantage of an HR software application for some or most of your processes. In the absence of an HCM software solution, you may be compiling data in spreadsheets, or even manually with forms and paper filing systems. Recording and transferring data accurately into usable reports by either of these means is a labor-intensive and time-consuming endeavor. Staying HR-compliant, processing payroll, and administering benefits in this manner can tie up valuable HR administrative hours that could be better spent developing and retaining top talent or contributing higher-level strategizing to your leadership team. Additionally, more strategic talent management functions, such as recruiting, employee development, and evaluating performance and compensation, are becoming mission-critical in the rapidly growing competition for skilled people and are nearly impossible to manage effectively with the above out-dated method. You may outsource part of your processes, such as payroll, through a service bureau. Or perhaps you outsource several processes to multiple vendors. Although outsourcing can relieve some of the pressure of HR management, it has its limitations and drawbacks, including the strict adherence to a service bureau’s deadlines and requirements and time lags and restrictions in running reports with up-to-the-minute data. Regardless of your industry type, its size, whether your employees are in one central location or dispersed in multiple areas, or whatever your method today for managing HR functions, advancing to UltiPro’s SaaS will give you an award-winning, comprehensive, convenient, easy, and efficient system for managing every aspect of HR for the complete employee life cycle, from recruitment to retirement, while maximizing time and resources for greater corporate success. You’ll have all of your processes managed under one umbrella with a single-point of contact. You’ll have all the advantages of an in-house system—and more! You’ll control when and where you use the system, with 24-7 access and support. You’ll manage your HR functions instantly online while reducing administrative tasks and paper work, but you’ll be free from service bureau restrictions and limitations. And you won’t need in-house technical equipment, support, or service. Instead, your company can pour its saved time and technology resources and expertise into accomplishing your core business objectives.


Benefits for Your Entire Organization UltiPro through SaaS will greatly enhance your HR management. But the benefits are much more far reaching as they touch everyone in your organization and the company as a whole. Examples of company-wide benefits include:

“Reporting is so much faster and relevant now that we have UltiPro. Previously, the reports from the service bureau were often outdated and weren’t always correlated with the data from our HR system, so we had to compare the results and reconcile them, UltiPro’s reporting is point-in-time and very flexible, so I can quickly get what I need. I used to spend more than two months putting together benefits statements for employees. UltiPro has been a life-saver for me—I can run very complete total compensation reports for employees in less than a day.” Candy Scranton HRIS Manager Spirit Mountain Gaming “We are experiencing an annual cost savings in excess of $500,000 through the elimination of service bureau fees, increased HR and payroll productivity, and faster and more efficient reporting.” Dave Mahler Vice President and Treasurer Genmar Holding Company

Entire Organization • Improved efficiencies and paperless workflow • Improved company-wide communication • Greater employee satisfaction • Minimal up-front capital expense • Same HR management advantages of Fortune 1000 firms without up-front investment • Improved ability to recruit, hire, train, and retain top talent • Ability to better leverage in-house IT to accomplish core business objectives • Greater ROI in time and money

HR Administrators • Convenient 24-7, anytime/anywhere access—at the office, at home, or on the road • Easy, efficient, comprehensive, state-of-the-art HR management under one umbrella • Manage HR functions for unlimited employees in any location • Efficient online benefits administration • Instant, uncomplicated, up-to-date reporting • Management and distribution of thousands of resumes easily online • Hours of saved time in answering manager and employee inquiries • Award-winning service and technical support from application and HR experts • Increased time for higher-level strategizing and recruiting, hiring, and developing employees • Improved workflow for form-intensive processes with approvals • Monitor and assure HR compliance

Top-Level Executives/Line and Department Managers • Evaluate metrics and business intelligence for workforce trends • Convenient 24/7, anytime/anywhere self-service access—at the office, at home, or on the road • Empowered through self-service and decreased reliance on HR • Instant, easy-to-use, up-to-date reporting and analytics • Easy, efficient administration of performance reviews • Approve staff requests • Manage paid time off • Monitor and forecast staffing levels • Access and evaluate headcount reports

Employees • Empowered through self-service and greater control of personal information • Convenient 24/7, anytime/anywhere self-service access—at the office, at home, or on the road • Instant information and updates without assistance from HR • Improved company-wide communication • Organized information in one place • Less paperwork • Improved training and development tracking and planning • Increased efficiency, time, and productivity focused on core responsibilities


Sample Features of UltiPro® through SaaS

CORE SOLUTIONS

Human Resources • Track employment history and performance, time and attendance, job, salary, and organization information

• Streamline processes for performance reviews, competency assessments, succession planning, training, and development

• Record key government compliance and reporting including COBRA, HIPAA, OSHA and Workers’ Compensation, and EEO Compliance

• Meet Social Security and HIPAA confidentiality compliance

Benefits Administration

• Set up and administer all health and welfare benefits plans, including Section 125 plans, deferred compensation and all voluntary and optional benefits programs

• Allow employees to check benefits options and coverage online and update beneficiary information

Payroll Administration

• Process payroll from start to finish in a few steps, including calculating gross-to-net pay, overtime pay rates, shift premiums, garnishments, and levy calculations

• Generate NACHA files, check/direct deposit advises, and general ledger files • Generate off-cycle checks and voiding payments on demand • Track payroll progress online with checks and balances for streamlined auditing and reconciliation

Portal for Employee Self-Service

• Save hours of time answering calls and inquiries by granting employees instant, security-protected access to their paycheck details, benefits summaries, frequently used forms, and company information

• Enable employees to update personal data, change direct deposit accounts, update dependents/beneficiaries information, and request paid time off

Portal for Manager and Executive Self-Service

• Enable executives and managers to access analytical reports, headcounts, open positions, job history, skills and certification inventory, compensation information, etc.

Standard and Ad hoc Reports

• Run, without support from central HR/payroll or IT, hundreds of reports and analytics, including reviews, headcount reports, average salary reports, government compliance, general ledger reporting and other real-time business intelligence, plus BI tools for ad hoc reporting and analytics

ADDITIONAL FEATURES

Enhanced Talent Management Capabilities

• Manage every aspect of recruitment – Automate entire recruiting and applicant tracking process –management team, recruiters, HR

staff can track and manage tasks such as posting open jobs, reviewing resumes, screening candidates, scheduling interviews, and more

• Administer performance evaluations efficiently and easily • Organize and manage learning and development • Facilitate time and labor management

IT Support • Cut costs and free in-house IT support from server installation and management, software upgrades, log-in management, hardware maintenance, backup and recovery management, capacity planning, application performance tuning, inventory management, server monitoring and management, technology refresh, and DBA support

Scalability/ Reliability

• Have peace of mind knowing applications have been rigorously tested and can withstand two key stresses: (1) single-user, high-volume functions (a huge payroll or check run) and (2) high-frequency, simultaneous-user demand, (thousands of employees needing W-2s, enrollment information or other data at the same time)

Enterprise Integration

• Interface easily with third-party applications such as general ledger, point-of-sale, etc.


“SaaS provides us with control of our data, without the hassles of server storage, system maintenance and upgrades… It’s enhancing our employee-centric culture, increasing overall productivity levels, and reducing both hard and soft costs.” Claudine Tudgay Payroll Director The Container Store “Before UltiPro, our IT team was extremely busy, so we had to wait in line for things like having them install UltiPro’s quarterly tax updates, causing some real issues. UltiPro delivered through SaaS has addressed this problem. Now Ultimate Software performs our upgrades for us and maintains the hardware, so we can all focus on other projects. I like knowing that our data resides safely and securely in Ultimate’s state-of-the-art data center, and I can quickly access that data any time I need to.” Barbara Cuttino HRIS and Payroll Manager Alfa Laval

While there are numerous advantages in using UltiPro, there are four primary benefits that lead companies to choose UltiPro through SaaS for managing human resources: in-house control with outsourced convenience, return on investment, best-in-class technology with peace-of-mind security, and award-winning and expert service.

In-House Control with Outsourced Convenience Whether currently using an external service bureau or an on-premise system, there are advantages in moving to SaaS. Companies switching from a service bureau to SaaS-delivered UltiPro, experience the same maintenance-free, worry-free support a service bureau offers but with far more efficiency and hands-on control over all processes, schedules, and report access. On the other hand, those already using in-house systems retain in-house control with the bonus of eliminating in-house IT support and equipment and the associated expense. SaaS is a more advanced form of outsourcing. There are no rigid payroll schedules or deadlines with SaaS like those often imposed by service bureaus. Users decide how often and when to process payroll, assuring accuracy and speed, yet more flexibility. Software functions and reporting are immediately available, self-controlled, processed, and ready in just a click or two. Ultimate’s SaaS assures higher functionality and control than outsourced processes, and elimination of hardware, updates, maintenance, and tech support demands associated with on-premise solutions. By relying on Ultimate Software to manage all system responsibilities, time can be better spent using data to drive new business efficiencies, programs, or initiatives, as opposed to all the time typically devoted to managing and maintaining systems. All subscribers experience is worry-free performance because behind the scenes, Ultimate Software expertly manages every system detail, including hardware purchases, software installations, quarterly federal and state employment legislative updates, software versioning upgrades to keep speed and performance optimized, and leading-edge security and monitoring tools for ultimate protection. Unlike on-premise IT departments often hampered by multiple priorities and limited resources, Ultimate Software’s staff can devote 100% of its energies to ensuring that a system remains optimized, security-protected, up-to-date, and problem-free. Who better to support and maintain UltiPro than the experts who created it? They have seasoned experience on their side from performing hundreds upon hundreds of installations and upgrades routinely—many for companies with thousands of employees and very complex needs. Their awareness of minute details and knowledge of every component and proper execution save clients time and frustration. Fewer components…far more space. Because bulky servers and other hardware components are housed off-site, SaaS frees up an organization’s valuable data center space that can be used for other services. A decrease in hardware and the space to house it translates to an increase in capital for other core business line items.


“Our reduction in costs exceeds $200,000 per year …Everyone is functioning more productively and strategically.” Kathy Milligan Vice President of Human Resources General Investment Development “We are anticipating a savings of $400,000 over a five-year period. UltiPro’s predictable per-employee, per-month pricing has erased the sticker shock we had at month’s end with our previous provider.” Sonny Ramdeo Director of Payroll and Workforce Systems Promise Healthcare

Return on Investment With shareholders and management demanding greater ROI accountability at every level, most HR leaders are actively seeking ways to maximize resources to meet competitive market conditions. Ultimate’s SaaS has conclusively shown strong ROI rewards by helping boost a company’s productivity and reduce both hard and soft costs. Return-on-Investment Rewards with SaaS

Frees up capital and cash flow Every dollar a company saves on non-productive system costs can be funneled back into core competencies to drive greater profit. With minimal up-front costs, no licensing fees, no in-house equipment, and many more productivity and efficiency tools than service bureaus offer, savings can be significant in relatively short time.

Matches monthly service bureau affordability, but with higher productivity and efficiency More hands-on control; 24-7 flexibility; wider functionality; deeper, customized reporting intelligence; and better security protection all lead to tangible dollar savings.

Leverages Fortune1000 business intelligence advantages without steep costs SaaS levels the playing field for smaller-to-medium sized firms benefiting from many of the same powerful tools and controls the larger corporations use to manage and maximize their workforce potential, without the staggering IT investments these bigger firms have made.

Enables flexibility without huge upfront costs UltiPro through SaaS can be as robust or as streamlined as desired, depending upon a company’s size, processes and expected growth. The integration of all HRMS/HCM initiatives, resulting in deeper functionality, is another benefit of SaaS.

Prevents high costs of obsolescence With technology lifecycles now measured in months, not years, SaaS shields against the significant financial costs of upgrading outdated technology or software.

Reduces training time and turnover costs SaaS eliminates costly training of new hires or existing teams whenever the software changes. With IT worker-replacement costs at roughly 1.5 to 2 times the annual salary, plus double-digit placement fees, sign-on bonuses for in-demand skills, relocation costs, and higher-than-average annual increases, in-house system costs mount rapidly.

Drives sharper decision-making The real-time speed and in-depth analytics assure faster, more confident decisions on staffing, budgeting, and funding, all of which directly impact a company’s bottom line.

Frees up office space Without cumbersome system hardware and servers, companies gain more usable workspace for employees.

Frees up talent and time Rather than losing hundreds, even thousands of employee hours installing, managing and troubleshooting systems, SaaS users can focus more on greater company efficiencies and profits.

Enhances autonomy, results, and satisfaction While a service bureau can only process specific payroll and benefits functions, SaaS capabilities can actually elevate a team’s total productivity far beyond the specific tasks themselves.

Increases productive time SaaS frees up entire work days by reducing or eliminating time-intensive tasks like manual printing and distribution of direct deposit information. HR professionals save hours of time answering employees’ telephone and email queries about payroll and benefits information. With SaaS, all employees access their up-to-date information online.

Empowers employees Equipped with best-in-class operating systems, software, reporting tools and processes, employees not only reduce their job frustrations and increase their capabilities, but also boost their confidence and self-reliance. That in turn increases job satisfaction, innovative thinking and professional growth—potential benefits to the bottom line.

Eliminates cost of internal disaster recovery On-premise disaster recovery systems are very expensive to maintain. With SaaS, Ultimate Software provides and maintains a first-class disaster recovery system, relieving businesses of this cost.

Delivers top-notch security with no added cost Most companies would find it cost-prohibitive to match the functionality of Ultimate’s SaaS security.


“…application hosting (Software-as-a-Service) customers have measured significant bottom line benefits …more than half interviewed experienced an ROI greater than 100%. This is consistent with IDC case studies conducted with three Ultimate Software customers reporting ROI percentages ranging as high as 188%.” Karen Moser Senior Research Analyst International Data Corporation (IDC) “By switching to SaaS, we’ve found the information on both the functionality and cost effectiveness to be true, and expect to recoup most of our initial investment within the first two years of using SaaS, and then start achieving major savings very quickly. We anticipate saving approximately $850,000 in a five-year period.” David Ochoa HRMS Manager National Gypsum

Return on Investment The first recognizable financial benefit in selecting UltiPro via SaaS is the savings in capital expenditures. Because Ultimate’s SaaS is an affordable, pay-as-you-go subscription model paid per-employee-per-month, minimal up-front cash is necessary, which frees capital for other investments to grow your business. There is no cost for expensive in-house technical equipment or the personnel to maintain it, like with on-premise systems. You get state-of-the-art, robust strategic HR tools and increased efficiencies without investing huge amounts of money. SaaS also eliminates large start-up expenses and the cost of hardware and application upgrades, which reduces operating costs that would otherwise exist with an on-premise system. Additional ROI over time occurs with increased efficiencies in processes, resulting in savings of time and improved productivity In cases taken from Ultimate Software’s client files, measurable SaaS results clearly show the substantial ROI and rapid payback times:

Company Total Employees

ROI Results

Payback Time:

Analyst Source:

National Gypsum 2,700 157% 1.01 years IDC, 2006

IntelliRisk Management 4,275 778% 1.8 months IDC, 2006

Waterloo Industries 1,100 214% 6 months IDC, 2006

Genmar Holdings, Inc.

3,341

80% 1.6 years Nucleus Research, Inc., 2004


Recalling an 8-day power loss at corporate offices: “During a weeklong power outage, my team could access our HR/payroll over the Internet, so we had no downtime with our human resources and payroll system. We were very impressed with Ultimate’s capabilities.” Louis Nault Director of Finance Elizabeth Arden

Best-in-Class Technology/Peace-of-Mind Security Better technology…fewer worries. Ultimate Software invests in top-grade systems to serve a multitude of corporate clients. As a result, the huge buying power, leading-edge security monitoring systems, and expert staff mean subscribers utilize elite-level hardware, software, and IT support services few companies could ever afford in-house. With rapid changes in technology, most companies could not afford to continually update hardware for maximum performance. Because Ultimate Software’s business is UltiPro and hosting the applications on secure, state-of-the-art IT equipment, the expense of costly upgrades to prevent obsolescence falls to Ultimate Software and not to your company. You continue to save in capital investments over time but keep receiving the most up-to-date functionality. Software upgrades, too, are done for you by Ultimate Software’s technology and UltiPro experts. You get all of the advantages of product and system upgrades immediately upon availability but none of the hassles of installing and maintaining them. Ultimate Software safeguards the confidential employee data systems and processes via SaaS for hundreds of corporations, some with thousands of members all networked across global locations. Each company’s data is housed in a physically separate data base. Only company personnel with access rights and secured passwords can see their specific company data, and the software itself is rigorously tested to ensure security integrity. The only thing shared is the application itself. Sharing a SaaS application is much like how millions of corporate users safely share Windows or Microsoft Office applications and online updates, yet they maintain a totally unique and separate database and usage. Ultimate’s SaaS includes many layers of embedded protection designed to safeguard the integrity and privacy of human resources data. These layers are incorporated through application, database, and web-level security built into the software. To protect data in transit Ultimate Software’s security safeguards include layers of redundancy, duplicate network operations control centers, and encrypted transmissions. All data is hosted at a secure site, backed up regularly, and frequently checked for viruses using secure-network connections to ensure privacy of data. Unlike many company servers, Ultimate Software’s hosted servers are protected against fires, natural disasters, power outages, sabotage and theft. SaaS provides better protection, security, and confidentiality than many on-premise systems. In January 2008, Ultimate Software became the first HR/payroll Software-as-a-Service provider to be awarded the ISO/IEC 27001:2005 Certification for its SaaS environment. ISO/IEC 27001 is a global industry standard created by the International Organization for Standardization and the International Electrotechnical Commission that validates organizations that have implemented a sound and secure information security management system. On the next page is a diagram that outlines the multiple layers of security in Ultimate’s SaaS delivery model.


Ultimate’s SaaS Security The following diagram illustrates the multiple layers of security in the SaaS delivery model.


“SaaS is reliable and never down. We are very pleased with Ultimate’s customer support.” Tom Short Payroll Specialist Oncology and Hematology Care

Award-Winning, Expert Service With Ultimate Software’s SaaS, you receive total accountability with fewer points of contact. When questions or concerns arise about hardware, software, networks, operating systems, security or any other related issue, you have an expert single point of contact immediately, 24-7, as opposed to having an in-house system with many parts and different vendors or a service bureau unable to help with anything but the bureau’s specific processes or reports. All customers have a named service representative assigned to their account for personal, prompt attention to their needs and inquiries. Comprehensive, single-point-of-contact service from experts frees users from serving as systems integrator or troubleshooter, dramatically reduces phone calls and meetings, and protects budgets from steep and unexpected technical support fees should problems occur. You focus on the most critical aspects of HR management, while the technology behind it is taken care of for you. Ultimate Software’s national support team is staffed by professionals with average industry experience of more than 12 years. Many support team members are Certified Payroll Professionals (CPP), and all staff are encouraged and rewarded if they receive CPP certification, in addition to other industry certification. The company has earned rigorous Support Center Practices (SCP) certification for eight consecutive years along with a first-place STAR service ranking by the Services and Support Professional Association and numerous other customer service, employee, and performance awards. Ultimate Software was positioned as the sole Leader in Forrester Research, Inc.'s 2008 U.S. Mid-Market HR solutions Wave ranking, identified in the Leaders quadrant of Gartner, Inc.’s “Magic Quadrant for U.S. Midmarket Human Resource Management Systems, 2006,” and named the 2005 Payroll Provider of the Year by the Human Resources Outsourcing Association.


Summary Organization leaders know that their company’s success is dependent upon their people. As baby boomers leave the workforce, college graduates have greater employment options, and employer loyalty declines, finding and keeping good employees is one of the greatest challenges companies face today. They cannot afford not to make HR management a key business objective—if they want to hire and retain the best employees and further the growth of their companies. To stay ahead of the competition, companies need a strategic, integrated, and comprehensive solution for pro active talent management—one that leverages state-of-the-art technology to reduce time-consuming administrative tasks and one that is efficient, accessible anywhere at anytime, reliable, affordable, continuously developed and upgraded, and worry-free. SaaS-delivered UltiPro manages every facet of human resources, from recruitment through retirement, through one easily accessible Web portal. It delivers optimal convenience and functionality with best-in-class technology, security, and star-quality service for a significantly measurable return on investment. With UltiPro and SaaS, you spend more time strategizing and positioning your human resources efforts to hire and retain top talent and bring greater HR value to your company and its bottom line while Ultimate Software works behind the scenes to take care of the details and run all processes smoothly and efficiently. In 2009, Ultimate Software was ranked the #1 best medium-sized company to work for in America by The Great Place to Work® Institute for the second consecutive year. Ultimate Software ranked #3 on the list in 2006 and 2007. As a public company in the business of human resources, Ultimate Software realizes the high value of recruiting top talent and maintaining a passionate workforce. The same high-performance team and the passionate, people-oriented culture that make the company one of the best places to work in America drive the quality of UltiPro delivered through SaaS and the award-winning service behind it.

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SaaS Whitepaper