PricewaterhouseCoopers' HR Unit Unveils New Internet Business Strategy
By Christine Woolsey
Like many other traditional businesses looking for strategies to thrive in the new economy, PricewaterhouseCoopers' Global Human Resource Solutions practice is transforming itself to take advantage of the Internet.
The global HR consulting practice -- some 2,500 consultants and other staffers -- is morphing into an online human resource solutions group to be renamed UNIFI Network. The new company will become independent of PricewaterhouseCoopers later this summer and will offer integrated HR consulting and services to large employers (those with more than 10,000 workers) and their employees.
Specifically, UNIFI Network will develop HR programs and provide outsourced HR services that are enabled through Internet technology, said Reed Keller, group managing partner of PricewaterhouseCoopers' GHRS. Keller will become CEO of UNIFI Network once it becomes a separate company.
In addition to providing HR consulting and services, the new company will later this year launch an electronic commerce portal that will cater to the "worklife" needs of working Americans and their families.
"At the literal level, we will build and operate Internet portals to serve workplace communities found within very large employers," Keller explained. The portals will serve a dual purpose -- to capture and leverage knowledge for corporate benchmarking and business and human capital improvements, and to capture and leverage information and pinpoint services that will address employees' work/life needs.
According to Keller, UNIFI Network's e-commerce model serves two customers -- corporate clients (business-to-business) and employees and dependents (business-to-employee).
Keller likes to think of UNIFI Network as meeting a "spiritual" mission as well -- that is providing a workplace experience that is more engaging, interactive and personalized. "The workplace experience today is pretty droll vs. lively and energized. One of our goals is to create a higher level of intimacy between employers and employees" and to recognize that it is increasingly difficult to separate work from life. "We want to allow people to realize the best from both work and life and then unify content, community and commerce in a way that's not been possible before the advent of the Net."
Ahead of the curve
PricewaterhouseCoopers is not the first company to gravitate toward the Internet. Hewitt Associates LLC, another HR consulting heavyweight, recently announced plans to launch a new company, Sageo, that will specialize in Internet health benefits solutions, such as online health plan selection and enrollment. And Bank of American and Broadvision recently entered into an alliance to build employee benefit portals for U.S. corporations.
In addition, dozens of boutique firms -- such as Employease, employeesavings.com and iBenefits, to name a very few -- are sprouting up to offer niche HR and employee benefits services that take advantage of online technology.
While their technology infrastructures and specific product offerings may differ, what these companies do have in common is first-mover status in taking HR and benefits services and solutions to the Web. Keller admits UNIFI Network's products and services are probably ahead of the market in terms of demand, but he's confident that demand will eventually be there.
"I think we are doing right thing by running six to 12 months ahead of the market," Keller said. "Are people lining up in droves? No, but they will and my feeling is we better create the capacity in meantime to deal with the traffic once it's there."
Keller and others point out that many human resource professionals are adopting a cautious approach toward online strategies. "There is still a fair bit of reticence in the HR community about this," Keller said, "and I'm not sure why."
One possible interpretation may be the fact that a lot of large U.S. companies have spent millions building ERP solutions that provide shared information and services within the four walls of the corporation. But those involved in "webifying" human resources and other market sectors say these expensive systems could become obsolete in a truly interconnected economy.
Catering to various needs
In developing UNIFI Network, PricewaterhouseCoopers adopted a service model that provides multiple solutions, offered together or separately as part of an integrated consulting arrangement. For example, one module enables employees to search for information and service providers related to a specific work/life event, such as having a baby, caring for an illness, entering retirement or improving their careers. This service works in conjunction with Ask Jeeves, which has partnered with PriceWaterhouseCoopers to provide its natural language search engine.
Other services are aimed at improving corporate HR programs and providing administrative help for HR managers and others who handle day-to-day responsibilities, such as payroll processing.
UNIFI Network has publicly announced partnerships with Ask Jeeves and PeopleSoft, which will serve as the HR management solution (HRMS) for its human resource outsourcing clients. The company is also rapidly forming partnerships with other service providers to help build technology infrastructure, e-commerce capabilities and provide content for the portals.
Keller pointed out that UNIFI Network is designing its solutions to be accessible beyond the desktop computer. Accessing online HR and benefits tools can be a problem for some employees, such as telecommunications field staff or manufacturing line workers. As a result, UNIFI Network is studying how to offer access to its e-commerce portals through wireless devices and/or possibly home cable systems, Keller said.
Dollars and cents
UNIFI Network will offer its new services based on several different fee structures, which may include fee-for-service consulting arrangements, revenue sharing models and subscription-based fees based on the number of employees with access to an e-commerce portal and the extent of the portal services.
"I feel good about the strategy in the long term," Keller said. "This is a step up from outsourcing -- it's applying new economy principles and the Internet on a new and different level. And it requires a lot more technical expertise."
It also requires a ton of money to build. As UNIFI Network finalizes its business plans, it is also determining whether to take private equity investments and/or eventually go public to raise funds.
Whichever direction it takes, Keller appears optimistic about the company's financial success. "I'd say the future 12-month projection of revenue for UNIFI Network is around $500 million," he said.