MEET NAPEO’S INDUSTRY CHAMPION MEDALLION PARTNERS

We’re very fortunate to have such a robust, engaged, and active membership. Our industry is close-knit and committed to moving the industry forward to better serve small and mid-size businesses across the country. We’re also very fortunate to have so many dedicated partners who invest in and support our association’s initiatives and activities. Of the many supporters, our Industry Champion medallion partners represent the four companies who make the most significant investments in support of NAPEO. We’re glad to have their support; we hope you enjoy getting to know these companies a little better.

SLAVIC401K: INDUSTRY PIONEER TO INDUSTRY LEADER

Few things are more complicated than the PEO business, and even fewer things are more complicated than retirement plans within the PEO business.

It’s no surprise then that PEOs depend on knowledgeable partners to provide 401(k) plans. Research has shown that companies who participate within a PEO’s 401(k) plan are five times as likely to remain with that PEO than other clients. Simply put, retirement plans represent a sought-after benefit employers want to provide to employees. Offering retirement savings plans increases a PEO’s value proposition. It’s a hook to keep clients engaged and committed.

More than 36 years ago, John Slavic began building the infrastructure to offer such a hook to a new industry. He had extensive experience with Kemper 401(k) plans, rising to top salesman in the world. He recognized the opportunity that PEOs presented.

His decision to bet on a new industry has paid off. His company has grown from a single employee to over 300 today. Slavic401k serves more than 12,000 businesses representing more than 250,000 plan participants with more than $10 billion in assets under administration.

John Slavic pioneered the PEO retirement plan industry and has never stopped investing and innovating for the future. He understands how complex and dynamic the PEO industry is. An industry leader, he was chosen to be a past Chairman of The Employer Services Assurance Corporation (ESAC), the first PEO vendor to be given the position. John’s support of and investment in NAPEO as an Industry Champion medallion partner helps the association deliver on our goals to grow and support the PEO industry.

Making the Right Call

In the 1980s, John decided to write a financial newsletter to offer his take on the markets.

“I would take it to a printer and run around office buildings in Boca Raton to pass it out and hope the phone would ring,” he recalls.

It did, and John built a good practice with individual investors. In early October of 1987, he felt fearful about the market. He decided to make a gutsy call to pull all his clients’ assets out. Three weeks later the stock market crashed, and many Americans lost a great deal of their investments. One client was so impressed with his financial acumen, he called the Florida Sun Sentinel. A reporter and photographer came to John’s office, and he appeared on the front page of the business section. The article really catapulted his reputation.

Around this time John began encountering PEOs and thinking about how to work with the industry. He knew the PEO model required a unique approach, one that he would have to develop and build.

“From Slavic401k’s inception, we built a 401(k) record keeping system and administration system with the PEO in mind,” he says.

The company adopted a system based on providing a multiple employer plan (MEP), which at the time was uncommon. John notes that it was not until 2002 that the IRS issued a Revenue Procedure (a form of regulatory guidance) stating that PEOs may only provide 401(k) plans through a MEP.

The profound significance of this statement reverberated through the industry; it was the first formal acknowledgement of the PEO industry at the federal regulatory level. Slavic401k was prepared and leaders at this formative stage of the industry.

Slavic401k was the first to offer open architecture plans whereby the company takes funds from providers and assembles them in a best of class fund lineup. While deep financial knowledge and experience would certainly contribute to his success, John also recognized that technology would play an indispensable role.

Investing and Building for the Future

John notes that the company has always had an Oracle enterprise level license, and a cadre of developers on staff. He’s expanded recently to include a flexible team of anywhere from 25-45 developers.

“We’re as much a technology company as we are a 401(k) provider,” John says.

That means building the right technology infrastructure is as much a part of the company’s success as providing a good return on investments. Integration with payroll platforms was key to early success. It makes the platform an easy, smooth process to use and adopt.

“We’ve taken millions of dollars each year and re-invested in technology to keep up with such a rapidly changing world,” said John.

Slavic401k also provides numerous tech-driven tools and resources that bring added value to a PEO’s clients. On most Fridays John writes a commentary on the current state of the market that is sent to each plan participant with his or her account balance. Further, each month the owner/operator of each client employer receives test results for their plan within the MEP.

In 2019, the company’s robo adviser, Bespoke, won the prestigious FIS Impact Award for most impactful investment technology. The platform helps plan participants answer two essential questions 1.) how much to differ and 2.) how the deferral should be made. The system provides projections and recommended allocations and helps the participant manage it along the way.

The latest tool is Straight Through Plans 2.0 (STP). STP is designed to be fast and efficient. It simultaneously establishes a new plan within Slavic401k and the client employer’s payroll system in 10 minutes. There are many decisions companies have to make and the system distills it down to a few clicks.

“The 2.0 refers to the tax credit incentives in SECURE Act 2.0,” John explains.

STP shows a cost comparison of a new plan and the tax credits employers adopting their first 401(k) plan many qualify for. In many cases, the tax credits are enough to cover most or all of plan expenses for up to three years. Tax credit certificates are generated for each plan participant to take to an accountant. SECURE 2.0 is so complex, small businesses have a hard time understanding it. PEOs bring their compliance expertise to the table, and STP 2.0 makes sure participants can take full advantage easily.

Artificial Intelligence is the next technology frontier John hopes to conquer. Slavic401k has established an AI governance policy and documentation for AI use and is working to develop AI tools. The company is currently training an AI avatar to help customers answer complex questions in nanoseconds. In a nod to the 1974 legislation that established the 401(k) plan, the avatar is named Erisa.

“Everyone talks about AI, but it’s very difficult to design and use. We’re moving the needle,” John says.

“When we deploy it, I think we can double the size of our company and only slightly increase the number of internal employees,” he adds.

In a broader sense, John sees AI as crucial to any company’s long-term survival. Those that effectively and efficiently use AI will surpass those that don’t. He acknowledges this is a tall if not impossible task for small businesses. Offering access to AI-backed tools could be a new value-add for PEOs.

John has seen the industry develop from the early entrepreneurial, wild west days to the sophisticated and professional industry of today. It’s a very different industry, but one he’s glad to be a part of.

“I have nothing but gratitude,” he says, “It wasn’t a genius plan on my part, I just discovered PEOs at the early stage of the industry. We’ve grown working alongside PEOs ever since.”

PRISMHR: EMBRACING INNOVATION TO SAIL THE BLUE OCEAN

Kevin Andrews, president of PrismHR, has nothing but optimism for the future of PEOs. Andrews joined PrismHR in 2022, bringing three decades of experience in the HR technology space where he built and managed several leading organizations. Andrews shares that PrismHR’s story began nearly 40 years ago, offering an accounting system that eventually developed into a highly sophisticated software platform tailored to the unique needs of PEOs.

“We’ve come a long way,” says Andrews. “The PEO industry expects more, so we deliver more. Our commitment to innovation and helping small businesses via PEOs is unwavering.”

PrismHR, a Vensure Employer Solutions company, invests heavily in NAPEO as an Industry Champion medallion partner to support the association’s main mission to grow the PEO industry. Andrews has mapped out a vision for PrismHR that relies on a relentless pursuit of innovation to meet clients’ needs, especially around product development, technology and security.

Andrews also recognizes that his company is competing in the technology sector with different providers outside of the PEO industry. Many businesses could benefit from partnering with a PEO, but instead opt for off-the-shelf technology platforms that offer payroll and some other HR services, stopping short of co-employment and the full suite of PEO services. To Andrews, this means his company must think strategically about how their products can help PEO clients grow and retain clients via the PEO value proposition.

“If we’re not helping our partners grow, then we don’t grow,” he notes, “We go in with the mentality to understand their business and treat it like our own. We help them offer customized solutions to clients that deliver true value and benefits specific to the PEO business model.”

Andrews indicated that many PEOs are providing a hybrid service model where a customer may not be a fit for co-employment right now, but they still need help with payroll and HR services. To align with this trend, PrismHR focuses on supporting customer business growth in both Human Capital Management (HCM) and PEO markets.

“This level of support is important because we see SMBs moving between HCM and PEO services as their needs change,” Andrews explains. “This model allows the business to stay with our customers, so they can maximize their retention and growth strategy. Prism is by far the leader in the PEO service bureau space. With our recent acquisition of Execupay and the development of our HCM technology, we are positioned to become the leader in the HCM software space in the next few years.”

THE BLUE OCEAN

Andrews feels strongly that the real opportunity for growth in the industry will come from attracting new, never-before-users to PEOs.

“From a market penetration standpoint, I see a lot of blue ocean still out there,” he says. “There’s plenty of room for the PEO industry to keep growing. PrismHR provides the critical software infrastructure that allows PEOs to do so.”

Since PrismHR serves many PEOs, Andrews has a unique vantage point. He often sees one business leave a PEO for another PEO for myriad reasons; “paint swapping” as he calls it. One PEO may gain a new client, but the industry has not actually grown.

Andrews encourages his team to think about how PEOs can tap new markets and help SMBs unfamiliar with PEOs to understand their value proposition. “Historically, the PEO value proposition has focused on back-office administration and HR help,” explains Andrews. “However, the rise in sophistication and greater availability of technology platforms means that SMBs can now buy a software subscription to handle the paperwork that entrepreneurs loathe. PEOs must integrate this technology to remain competitive and work harder to communicate the full PEO value proposition.”

PrismHR helps PEO customers understand best practices on leading with this technology. “It’s important that technology be user-friendly and intuitive,” said Andrews. “Business owners are more familiar with technology than they were 20 years ago. Today, business owners also require self-service technology options to streamline their user experience and operational efficiency. PEOs need to offer technology that clients can use and engage with comfortably and effortlessly.”

More than just offering payroll processing, PrismHR’s marketplace suite of workforce management services allows PEOs to offer multiple options to clients, making the PEO offering even more attractive to more types of businesses. PrismHR partners with a variety of providers to offer these ancillary services to support small business such as telehealth, cyber insurance, early paycards, nearshore talent and more.

“We have a robust, rich marketplace of best-in-class services for small and mid-sized businesses.” Andrews says, “PEOs leveraging these resources can help create the adaptability and customization that these businesses need in the ever-changing business climate.”

To that end, in today’s dynamic environment, technology must also align with security protocols. Cybersecurity and data privacy are essential to technology innovation and best practices. Cybercriminals continue to grow more sophisticated which means detection and prevention measures must keep up.

“One of our biggest investments is around security, we have to lead from that area. From the time I got here until now, we have 20 more people on staff who work in cybersecurity,” Andrews says.

With such large volumes of payroll and data being handled each day, it is a continuous process to invest in and improve cybersecurity measures. Protecting customer data is paramount at PrismHR and in the PEO industry as a whole.

GENERATING VALUE FROM DATA

In addition to mastering technology, PEOs can stay competitive and grow the industry by leveraging robust data tools. Data is everywhere now, but making sense of it all can be the hard part. PEOs need to know which metrics matter and the most effective ways to interpret and apply data, especially to help their business and their clients.

Andrews sees data analytics and data visualization as prime opportunities for PrismHR to bring more value to its partners. Helping clients understand data reporting can make PEOs more competitive and efficient.

“We help PEOs look at what’s driving their top and bottom line, what’s causing customer retention issues and where they can identify opportunities for growth,” Andrews explains.

PrismHR recently rolled out an enhanced version of the company’s Report Center by adding its Data Warehouse. With a new dashboard and greater report building capability, users can analyze their data better than ever before. Data visualization also helps users interpret the data.

With Report Center, a PEO can spot trends among certain niches of clients. For example, by detecting a high number of layoffs, they can anticipate and prepare for higher unemployment insurance claims. This might help the PEO address common issues or understand specific marketing opportunities for each niche. Whatever the case, PrismHR empowers PEOs to use data to make better decisions that can improve operations.

PrismHR has played an important part in helping the industry move forward. By constantly delivering industry-leading HR technology, providing innovation to expand the PEO marketplace to new users, implementing strong cybersecurity measures and leveraging stronger tools for data management and analysis, PrismHR offers its partners the resources needed to thrive in an increasingly complex environment.

“Everyone at PrismHR is committed to keep on growing and innovating,” Andrews concluded. “Our customers and this industry can count on us to continue to lead the charge and deliver the technology that helps PEOs keep Main Street thriving.”

isolved: HERE TO STAY FOR PEOS

If you’ve attended a recent NAPEO Annual Conference, you may have noticed a lot more pink in the hallways. With their trademark pink polos, the isolved team is out in force at NAPEO events showing their commitment and investment in the PEO industry. As an Industry Champion medallion partner, the company strongly supports NAPEO and our mission to help grow the PEO industry.

isolved’s platform known as People Cloud is built to help companies scale and grow efficiently. With services spanning payroll, workforce management, benefit administration, and HR capabilities, isolved serves over 177,000 companies and manages the needs of more than 7 million worksite employees. What sets isolved apart is its commitment to providing end-to-end solutions that cover the entire employee lifecycle, from recruitment and onboarding to retirement.

“We own 100% of our IP, we want our PEOs to feel they get everything from soup to nuts from one provider. We have no dependencies on third-party administration,” isolved President Todd La Fever explains. “It [People Cloud] handles a lot of administrative tasks which is where you’re going to scale and find profitability as a business,” La Fever continues, “It may not be the shiny object, but it’s where you make your money.”

“We’re not zeroed in on a very narrow focus, we have a lot of capabilities that our partners can take advantage of,” he says.

The word partner is intentional. He’s invested in their business’ strength and growth for the long-haul. He doesn’t consider his company a vendor out to push a product, but strategic partners offering unique tools and resources.

To this end, isolved invests heavily in product development. With an annual investment of approximately 15% of its revenues in research and development, the company never stops pursuing innovation. By staying ahead of the curve and anticipating market demands, isolved ensures that its partners and clients have access to cutting-edge software solutions that empower them to thrive in a dynamic business environment.

The balancing act is building a software platform that serves PEOs and their clients. Each PEO that joins isolved’s platform brings hundreds of other businesses that have different processes, workflows and systems. People Cloud’s highly configurable environment allows for businesses to use the software without having to change existing workflows.

Another key strength lies in its security infrastructure which is built to enterprise-grade standards. In an era plagued by cybersecurity threats, isolved prioritizes the protection of its customers’ data, to shield from potential breaches and attacks. This commitment to security not only safeguards the interests of its clients but also reinforces isolved’s position as a trusted partner in the industry.

“We have to be good stewards to guard against bad actors; it is not healthy for anybody to have a challenge in our industry,” La Fever says, “When other companies have had challenges, we’ve reached out to offer assistance.”

A DESTINATION WORKPLACE

As important as a robust technology platform may be, more importantly are the human beings behind it. isolved traces its roots nearly 40 years back to a benefits administration company called Infinisource. In 2011, La Fever would merge his existing software company with Infinisource to launch the present-day iteration of the company, isolved. The company began seriously exploring PEOs in 2018 and began serving PEO clients a year later. La Fever says the PEO space is a key driver of growth for the company, and a market he’s fully committed to.

“We’re here to stay,” he says.

The first few years were spent learning the intricacies of the PEO business to discern what partners would need to be successful. A product steering committee of key members and partners in the PEO industry provided valuable feedback and insight as the isolved team built out the product. This committee will remain in place indefinitely, helping isolved adjust to ever-changing needs.

The hard work has certainly paid off with double-digit growth year over year, with the PEO space by far the fastest segment of growth. To keep up with client expectations and maintain product innovation and development, isolved also has to scale and grow. The company relies on a dedicated workforce of nearly 2,500 employees including many experienced PEO industry professionals. Training, education, and professional development are prioritized along with fostering an inclusive, positive culture.

A company is only as strong as its people and La Fever understands a healthy culture with engaged employees drives success. He hopes team members feel excited about coming to work and interacting with peers. It transcends into the client experience which is good for everyone.

An engaged and committed workforce will be crucial to maintaining the company’s growth while helping partners unlock new opportunities for growth. Leveraging new technology, especially AI, is an area where isolved’s expertise will be valuable. AI presents opportunities for PEOs, and partners like isolved can help lead the way on best practices. Automating repetitive tasks is an obvious example, but detecting data anomalies can be helpful, too.

Whatever the future may hold, you can be sure that isolved will be a part of it.

G-P: BREAKING DOWN GLOBAL BARRIERS

Over the past few years, many within the PEO industry have encountered employer of record (EOR) companies. There’s been a lot of discussion within the industry about how to partner with EORs. Fortunately, NAPEO has benefited from having G-P as an Industry Champion medallion partner. Founded by CEO Nicole Sahin 13 years ago, G-P was the first EOR company. Sahin pioneered the industry with a vision to help ​create opportunities for anyone, anywhere​​ ​

“I wanted to create a fast and easy way for companies to hire anyone, anywhere in the world – without setting up subsidiaries or local branch offices,” Sahin says.

She explains that scaling globally had been an option reserved for the largest companies, ones who could handle the incredibly complex, time consuming and expensive process of establishing a business footprint in another country. Sahin seized the opportunity to create a solution for all ​ ​ businesses to take advantage of international hiring and global markets.

“Today’s business landscape requires companies to think beyond their home market for access to talent and to gain a competitive advantage,” she explains.

Two-thirds of executives are focused on growing their companies in 2024, G-P research shows. Yet, the lack of in-house expertise ​sometimes ​means that growing globally is not a feasible option. That’s where G-P comes in.

“We help companies hire, onboard, pay and manage team members quickly and compliantly in 180+ countries and counting – all without the hassle of setting up local subsidiaries and branch offices,” she says.

​​​​​​C​ompliance expertise is a key part of G-P’s value proposition. From the beginning days of the company, Sahin assembled a team of knowledgeable in-​country ​HR legal​ and compliance​ experts​ making it easy for companies to quickly and compliantly hire and manage teams anywhere in the world. ​​

AI-DRIVEN SOLUTIONS

Underpinning the company and supporting clients is a best-in-class technology platform backed by AI. Sahin believes that AI is the key to ​accelerating ​global success and that companies who embrace AI and innovation will thrive in today’s dynamic market.

“Our recent ​​AI at Work report found that 96% of executives believe that companies that use AI to support asynchronous work across countries or time zones will soon outpace those that don’t, and 65% believe AI is critical for operating and being competitive across global markets,” Sahin points out.

​​In 2023, ​G-P’s team of technology experts developed ​and introduced G-P’s Global Intelligence Assistant, ​GIA, a generative AI-enabled tool to help make every customer an expert in global growth. Sahin says the tool is a first-of-its-kind and represents G-P’s unmatched expertise on global employment and market-specific tax, benefit, and labor-law knowledge.

THE TRIPLE BOTTOM LINE

Unlocking the potential of global growth can help many companies reach what Sahin calls the triple bottom line: happy customers, happy employees, and happy shareholders. Engaged and motivated employees perform better work which translates to satisfied customers. This feeds into company success which makes shareholders and investors happy, she explains. All three components work together. G-P’s solutions help companies grow, scale, and create more value for customers.

​​T​he opportunit​ies​ with global growth ​have the potential to​​ ​make a big difference when it comes to attracting top talent. Growing globally means a company has a larger pool of talented, high-performing individuals to recruit from. Further, being a global company is a sought-after trait by many younger workers who make up the future of the workforce. G-P research found that a staggering 80% of employees want to work for a global company.

From Sahin’s perspective, this ​is ​part of a larger conversation of changing workforce expectations.

“Leaders have been grappling with the changing expectations of today’s workforce for the last few years. While this requires a mindset shift for some, I think it will ultimately change business for the better. The new generation of workers – that G-P calls Gen Global – are seeking more than a job – they want opportunities for growth, diverse experiences, work flexibility and independence,” she explains.

Global companies are well positioned to meet these expectations and deliver the employment experience employees look for. A G-P report found that a significant number of these Gen Global employees think that global companies provide access to better pay and benefits (49%), a culturally diverse workplace (48%), and greater flexibility (40%).

Simply put, to succeed and thrive​, ​businesses can’t afford not to consider growing globally. G-P offers clients the tools, resources, and expertise to make this goal a reality in a seamless way.

As an entrepreneur and company founder, Sahin knows the challenges of running a business. She saw companies struggle to master the payroll regulations, legal protocols, and cultural nuances of different international markets. The company she’s built has pioneered an industry with one overarching mission: to break down barriers for all.

“I wanted to open pathways and remove the complexities, enabling everyone, everywhere, to have equal access to global opportunity. This not only gives companies access to global talent but also opens up opportunities for brilliant, entrepreneurial people worldwide,” she says.

“We all have a role to play in breaking down barriers and creating a more positive future.”