isolved 2024 Survey Reveals HR Tech Trends for ASOs, PEOs, and PSPs

isolved, a trusted leader in human capital management (HCM), has released its second-annual survey of administrative service organizations (ASOs), professional employer organizations (PEOs), and payroll service providers (PSPs). The survey provides key insights into how service bureaus are managing client relationships, leveraging HR technology, and addressing workforce dynamics in today’s volatile job market.

• Key Insights from the Report: The study, titled Pendulum of Opportunity: A Research Study on ASO, PEO and PSP Expansion and Evolution Amid Dramatic Employer-Employee Dynamics, revealed that:
  • 80% of ASOs, PEOs, and PSPs are not offering new solutions provided by their HCM vendor, despite clear client demand.
  • While 54% of ASOs, PEOs, and PSPs offer standard HR analytics, only 32% provide more advanced tools like predictive analytics and benchmark insights.
• Opportunities in HR Analytics:HR analytics remains the top area for investment among HR leaders. Service bureaus could benefit from investing in broader analytics capabilities, yet they are cautious for reasons such as:
  1. Lack of confidence in early-stage product releases.
  2. Perceived lack of client demand.
  3. Complexity of implementation. Notably, 90% of ASOs hold back on new offerings from their HCM vendor, compared to 67% of PEOs.
• Challenges and Solutions:Pragya Gupta, isolved’s Chief Product and Technology Officer, commented on the findings:

“Our research highlights the growing disconnect between employers and employees. PEOs, ASOs, and PSPs must rapidly evolve to stay relevant, supporting HR in stabilizing dramatic changes and improving employee experiences.”

• HCM Vendor Trust Issues: A majority of respondents indicated no plans to add new managed or professional services this year. Additionally, only 14% of service bureaus are very confident in the support they receive from their primary HCM vendor, signaling a trust issue that could present an opportunity for firms willing to expand their offerings and build stronger partnerships.

The isolved 2024 survey paints a clear picture: PEOs, ASOs, and PSPs face a pendulum of opportunity as they navigate client demand for advanced HR technology and the need to evolve in an ever-changing workplace. Collaboration with a trusted HCM partner that offers robust support and resources will be essential for service bureaus to grow and thrive.