UKG Acquires Inova Payroll to Deepen SMB HR and Payroll Services Push

UKG is making a clear bet on small and mid-sized businesses—and backing it up with a full acquisition. The HR, payroll, and workforce management giant has signed a definitive agreement to acquire Inova Payroll, a Nashville-based HCM and payroll services provider best known as the largest reseller of the UKG Ready suite in the U.S.

Once the deal closes, UKG will move beyond selling software to SMBs and step directly into delivering outsourced HR support and full benefits brokerage services—an increasingly attractive model for smaller employers stretched thin by compliance, hiring challenges, and rising benefits costs.

Why UKG Wants Inova

Inova isn’t just another regional payroll firm. The company supports more than 4,000 SMBs and has spent nearly two decades building deep operational expertise around UKG Ready, particularly for organizations with frontline-heavy workforces.

For UKG, the acquisition does three things at once:

• Expands direct access to the SMB market, a segment traditionally underserved by enterprise HCM vendors

• Adds a services-first layer—outsourced HR and benefits brokerage—on top of UKG’s technology stack

• Brings in proven SMB specialists who already know how to sell, implement, and support UKG Ready at scale

UKG President and CFO Arlen Shenkman framed the move as a way to help SMBs “level the playing field” against larger competitors—an increasingly common theme as workforce technology vendors push downstream into smaller organizations.

A Shift Toward Services-Plus-Software

The acquisition highlights a broader shift in HR tech: SMBs don’t just want tools; they want outcomes. While UKG Ready is widely used for scheduling, timekeeping, payroll, and HR management, many small employers still struggle with compliance, benefits administration, and day-to-day HR execution.

Inova’s model addresses that gap by combining technology with hands-on HR and benefits expertise. By bringing Inova in-house, UKG can now offer a more vertically integrated experience—software, services, and support under one roof.

This mirrors moves across the HR tech landscape, where vendors are increasingly blending SaaS platforms with managed services to improve retention and lifetime customer value, especially in the SMB segment.

What Changes for Customers

For existing Inova customers, the acquisition promises closer alignment with UKG’s product roadmap and deeper access to platform innovation. Inova CEO Joe Schweppe emphasized that joining UKG will accelerate product development while preserving the service-centric approach that has driven Inova’s growth.

For UKG customers—particularly SMBs—the deal could unlock:

• Expanded outsourced HR services directly from UKG

• Integrated benefits brokerage alongside payroll and workforce management

• Stronger compliance support for complex regulatory environments

• Fewer third-party handoffs, reducing operational friction

UKG has not signaled plans to disrupt Inova’s current service model, suggesting continuity for clients while gradually integrating capabilities into UKG’s broader ecosystem.

Competitive Context: SMBs Are the New Battleground

The SMB HCM market is becoming increasingly competitive, with vendors like Paychex, ADP, Rippling, Gusto, and Paylocity all racing to differentiate through bundled services, vertical specialization, and AI-driven automation.

UKG’s advantage lies in its strength with frontline workforce management—a critical need for retail, healthcare, manufacturing, and hospitality SMBs. By pairing that technology with Inova’s services expertise, UKG positions itself as more than a software provider: it becomes a workforce operations partner.

That’s a compelling proposition for SMBs that want enterprise-grade capabilities without enterprise-level complexity.

Inova’s Track Record Matters

Inova brings credibility to the deal. The company has appeared on the Inc. 5000 list of fastest-growing private companies eight times—an achievement reached by less than 1% of honorees—and has earned multiple G2 awards based on customer satisfaction.

Those signals matter in a market where trust and service quality often outweigh feature checklists, especially for smaller employers making high-stakes payroll and HR decisions.

The Bigger Picture

This acquisition underscores UKG’s long-term strategy: dominate the workforce experience across company sizes, not just the enterprise. As economic uncertainty keeps pressure on SMBs, demand for simplified, outsourced, and reliable HR solutions is only growing.

By acquiring Inova, UKG isn’t just expanding its customer base—it’s reshaping how it serves one of the most complex and opportunity-rich segments in HR tech.

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