Automatic Data Processing, Inc. · NASDAQ:ADP
Automatic Data Processing — Investor Day (June 2018)
121 slides from Automatic Data Processing's investor day presentation, Jun 12, 2018
Slide 1: 2018 Investor Day: Momentum Through Transformation
2018 INVESTOR DAY 2 2 ee MOMENTUM THROUGH TRANSFORMATION June 12, 2018 Copyright © 2018 ADP, LLC
Slide 2: Agenda
AGENDA Registration, Breakfast, and Product Demonstrations Welcome Christian Greyenbuhl, VP investor Relations Building on our Momentum Carlos Rodriguez, President and CEO Strategic Vision Don Weinstein, Chief Strategy Officer Innovating for Tomorrow's Workplace Stuart Sackman, Chief Technology Offi
Slide 3: Forward Looking Statements
FORWARD LOOKING STATEMENTS This presentation and other written or oral statements made from time to time by ADP may contain “forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not historical in nature and which may be identifie
Slide 4: Please Note
PLEASE NOTE Slide presentation and speaker information: investors.adp.com Product demo availability * During the break » After program until 12:30 p.m. Two Q&A sessions * One mid-way through the program * One at the end of the program
Slide 5: Investor Day 2018
2018 INVESTOR DAY 2 2 ee
Slide 6: Carlos Rodriguez
2018 INVESTOR DAY Carlos Rodriguez Copyright ©2018 ADP, LLC
Slide 7: ADP Is Transforming — We Have Momentum
ADP IS TRANSFORMING — WE HAVE MOMENTUM TRANSFORMATION ENABLERS Accelerate product and technology innovation © Enhance our world class distribution Focus on operational excellence (i) Strengthen talent and performance culture RECENT ACCOMPLISHMENTS v Launched live clients on Next Gen platforms v Acce
Slide 8: We Are Executing and Exceeding Our Commitments
WE ARE EXECUTING AND EXCEEDING OUR COMMITMENTS ACCELERATING FY18 EXCEEDING FY18 PERFORMANCE GUIDANCE Increasing new business bookings growth Original guidance? Most recent guidance? 6% ad = || Revenue growth 5% -6% t T% -8% Ez”. Th id % New business of, 79 oy, 417 Qi18 218 Q3'18 bookings growth 5% -
Slide 9: New Initiatives Are Accelerating the Pace of Our Transformation
NEW INITIATIVES ARE ACCELERATING THE PACE OF OUR TRANSFORMATION TRANSFORMATION NEW INITIATIVES TO ENABLERS ACCELERATE PACE v Accelerating roll-out of Next Gen platforms v Expanding further into gig economy v Innovating in digital payments Accelerate product and technology innovation v Scaling digita
Slide 10: We Are Accelerating Our Margin Targets
WE ARE ACCELERATING OUR MARGIN TARGETS ADJUSTED EBIT' MARGIN 23% - 25% 21% - 22% 19.8% FY17 FY19F FY21F 1. Adjusted EBIT is a non-GAAP metric. Refer to the Additional Materials fora reconciliation to the closest GAAP metric. 2._ As outlined in September 12, 2017 investor presentation.
Slide 11: We Continue to Be Strongly Positioned in Highly Attractive Markets
WE CONTINUE TO BE STRONGLY POSITIONED IN HIGHLY ATTRACTIVE MARKETS STRATEGIC PILLARS ® @ & Grow a complete Scale our market leading HRO Leverage our global presence suite of cloud-based Solutions by leveraging our to offer clients HCM Solutions HCM Solutions platforms & processes wherever they do bu
Slide 12: We Believe in Strong Governance and Sustainable Long-Term Value Creation
WE BELIEVE IN STRONG GOVERNANCE AND SUSTAINABLE LONG-TERM VALUE CREATION Ongoing board refreshment Released first ever Corporate Social Responsibility report in response to shareholder feedback Created technology committee to help drive corporate strategy Adopted proxy access Independent non-executi
Slide 13: What You Will Hear Today
WHAT YOU WILL HEAR TODAY We are reshaping We are accelerating the HCM industry and our transformation setting standards for innovation We are investing to Goal: Total Shareholder further enhance our Return — Top quartile of competitiveness and grow S&P 500 Copyright © 2018 ADP, LLC
Slide 14: Don Weinstein
2018 INVESTOR DAY Don Weinstein Copyright © 2018 ADP, LLC
Slide 15: ADP Is Positioned to Win in a Rapidly Evolving HCM Market
ADP IS POSITIONED TO WIN IN A RAPIDLY EVOLVING HCM MARKET HCM Trend Core Beliefs ADP Advantages . + Only HCM provider with a freelancer labor solution EVOLUTION : ee) (WorkMarket) OF WORK ieseatiee + Next Gen HCM platform uniquely built to serve dynamic, team-based organizations . + Industry-leading
Slide 16: WorkMarket Extends ADP's Leadership Across the Spectrum of Workers
WORKMARKET EXTENDS ADP’S LEADERSHIP ACROSS THE SPECTRUM OF WORKERS WORKMARKET: LEADING FREELANCE MANAGEMENT SOLUTION End-to-End Freelancer Management Tools — Sourcing — Screening — Contracting — Time tracking — Rating — Paying —SSSpay Labor Clouds - assemble pools of qualified talent to draw from lo
Slide 17: Wisely Digital Pay and Financial Wellness Strengthen Our Payroll Leadership
WISELY™ DIGITAL PAY AND FINANCIAL WELLNESS STRENGTHEN OUR PAYROLL LEADERSHIP WISELY: APP FOR MANAGING WORKER PAYMENTS AND FINANCIAL WELLNESS - BUILT ON GLOBAL CASH CARD DIGITAL PLATFORM * Instant and on-demand payments for workers * Simple, empowering tools to manage financial wellness » Available t
Slide 18: We Are Going Even Bigger on Big Data
WE ARE GOING EVEN BIGGER ON BIG DATA BIG DATA SOLUTIONS + Industry-leading DataCloud, brings insights from 30M workers to our clients * — Introduced Pay Equity Explorer™ and Flight Risk predictive model + Won RR Tech Top HR Product in 2016 and Awesome New Technology in 2016, 2017 + Expanding globall
Slide 19: We Are Growing the World's Largest HCM Ecosystem and API Portfolio
WE ARE GROWING THE WORLD’S LARGEST HCM ECOSYSTEM AND API PORTFOLIO ADP MARKETPLACE: OPEN HCM INTEGRATION PLATFORM AND PARTNER ECOSYSTEM ar * 250+ apps available See cn Sesto * 2K partners in pipeline ocbhang #@ © © * 12K+ app transactions * Won HR Tech Awesome New sini 0. : a Technology and Top HR x
Slide 20: Our Next Generation Platforms Are Built for the Future
OUR NEXT GENERATION PLATFORMS ARE BUILT FOR THE FUTURE NEXT GENERATION PLATFORMS DIFFERENTIATION Offers open platform Empowers agile organizations Supports flexible work and on-demand pay Delivers seamless global capabilities Provides “low- code” development platform + HCM “your way” satisfies diver
Slide 21: Stuart Sackman
2018 INVESTOR DAY Stuart Sackman Copyright © 2018 ADP, LLC
Slide 22: Our Next Generation Platforms Are Built for the Future
OUR NEXT GENERATION PLATFORMS ARE BUILT FOR THE FUTURE NEXT GENERATION PLATFORMS DELIVERING DIFFERENTIATION Supports Delivers Provides flexible work seamless “low-code” and on- global development Empowers agile organizations Offers open platform demand pay capabilities platform Copyright © 2018 ADP,
Slide 23: Our Next Generation Platforms Are Built for the Future
OUR NEXT GENERATION PLATFORMS ARE BUILT FOR THE FUTURE NEXT GENERATION PLATFORMS DELIVERING DIFFERENTIATION
Slide 24: Person-Centric
PERSON-CENTRIC
Slide 25: ADP My Jobs
‘ADP My Jobs <Back View Other Werke > Amy's Awesome Designs - 1099
Slide 26: ADP My Jobs
43> ADP My Jobs <Back ‘Amy's Awesome Designs - 1099 June 12, 2018 Take home pay $150 Jumpstart Coffee - W2 June 12, 2018 Take home pay $250 a View Other Werk >
Slide 27: ADP My Jobs
‘ADP My Jobs View Other Werk > Sweet! You've started saving for your taxes Check your email for more information AB? ‘Amore hut
Slide 28: Our Next Generation Platforms Are Built for the Future
OUR NEXT GENERATION PLATFORMS ARE BUILT FOR THE FUTURE NEXT GENERATION PLATFORMS DELIVERING DIFFERENTIATION
Slide 29: Next-Gen HCM Mini-App Design Enables Mass Personalization
NEXT-GEN HCM “MINI-APP” DESIGN ENABLES “MASS PERSONALIZATION” User Needs @ Traditional HCM SaaS @ ADP Next Gen HCM Mini Apps on EF z Workers a = wi SB BS Dee eect eecneee renee 1 lll ssa ss aeeeasesesessaeeeveesaseeneeess = Managers ae ae a Ges B88 8 Practitioners ses sans San Baa USER REQUIREMENTS
Slide 30: Over Mini-Apps and Growing
OVER 40 MINI-APPS AND GROWING @ Lo} a & =
Slide 31: Our Next Generation Platforms Are Built for the Future
OUR NEXT GENERATION PLATFORMS ARE BUILT FOR THE FUTURE NEXT GENERATION PLATFORMS DELIVERING DIFFERENTIATION
Slide 32: Org Chart Departments Company Team
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Slide 33: Work Groups
WORK croups Departments Company Teams
Slide 34: Work Groups
‘WORK Groups Engagement ¥ Healthy mmm AtRisk — @ 89% Teams 79% _aMonons sameness 93% 72% yc en 95%
Slide 35: Our Next Generation Platforms Are Built for the Future
OUR NEXT GENERATION PLATFORMS ARE BUILT FOR THE FUTURE NEXT GENERATION PLATFORMS DELIVERING DIFFERENTIATION
Slide 36: Slide 36
Slide 37: ADP Mobile
ADP Mobile Clock 12:06:45 June 12, 2018 Brooklyn, NY LUNCH BREAK TRANSFER
Slide 38: after tax
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Slide 39: ADP Mobile
43> ‘Amora human resource? = ADP Mobile View Other Work > Ride On Cycles - W2 June 12, 2018 Take home pay $89.47 (‘a © Reveal
Slide 40: ADP Mobile: Get Paid Today
= ADP Mobile Get Paid Today How much do you want to be paid? Your limit today is $89.47 $80 Where should I send your pay? DIRECT DEPOSIT
Slide 41: ADP Mobile
= ADP Mobile Woohoo! You've been paid Check your email for a pay statement
Slide 42: Our Next Generation Platforms Are Built for the Future
OUR NEXT GENERATION PLATFORMS ARE BUILT FOR THE FUTURE NEXT GENERATION PLATFORMS DELIVERING DIFFERENTIATION
Slide 43: Pay Policies
Pay Policies seme Q Search wae 35 Policy Results Filters x Clee Au Recommended Selects oe Country 401% Poicy ‘Additional Pay Poliey Base Pay Ca peyee renner 4004 Aan Poy Poy ose paypal australia lan and any earnings rom the Investments are tax-deferred Type Employees pay the taxes on Eamings On| On
Slide 44: Pay Policies
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Slide 45: Our Next Generation Platforms Are Built for the Future
OUR NEXT GENERATION PLATFORMS ARE BUILT FOR THE FUTURE NEXT GENERATION PLATFORMS DELIVERING DIFFERENTIATION
Slide 46: Employee Details
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Slide 47: Employee Onboarding
Employee Onboarding # Nn a @ Post A toa & Uxiey
Slide 48: Save Onboarding Employee Details
Save Onboarding Employee Details
Slide 49: [© Dus Conrat
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Slide 50: What would you like to do?
= Whatwouldyou like to do? ly check-in for Dracarys s Conduct a Apps and Actions AGILE ORGANIZATION % GLOBAL HR CORE % PAID TIME OFF
Slide 51: Our Next Generation Platforms Are Built for the Future
OUR NEXT GENERATION PLATFORMS ARE BUILT FOR THE FUTURE NEXT GENERATION PLATFORMS DELIVERING DIFFERENTIATION —_
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Slide 53: Org Chart
ORG CHART
Slide 54: Org Chart
ORG CHART
Slide 55: Details
DETAILS SSH SPOHELY SOW REQUIREME Hedy Margerum Nick Schafer Dane Golder Lunda Seabrook Kesha Escalante da Rugg Billye Nottage Annamaria Metellus Guy Monroy Alena Utz Dwain Izquierdo Jon Nestle 10f2 2of2 10f2 2of2 10F2 1of2 2of2 10f2 2of2 100% 88% 90% 100% 28% 29% 100% 88% 90% 100% 88% 3
Slide 56: Talent Pool
Talent Pool Slope Designers DETAILS REQUIREMENTS MEMBERS INVITE MESSAGES Q ||search Name, Skill, Product, User ID. Location Status Industry Talent Pool v Verification v| Ratings Type Certificationy | License Test Hedy Margerum 1 of2 90% New York, NY Nick Schafer 2 of 2 100% New York, NY Lucinda Seab
Slide 57: Org Chart Company
ORG CHART Company
Slide 58: Q mM PRY z-
Q mM PRY z- Nick Schafer User Experience Designer (Contractor) @ Brooklyn, NY ©. 555-525-6734 @nick.schafer@adp.com & Personal info Work Groups Join work groups # dresse Employee Experience SCRUM View group page Joyment Detail ein Deseription Members Agile product team for Employee Experience 4 Your
Slide 59: uxdesigners
uxdesigners Company May 10th, 2018 james Pieagiee Thanks for presenting the new userflows @?riya can you upload your deck please? Priya @james Yeah no problem! I'm just making some updates based on everyone's feedback and then Ill upload here so evertone can review, thanks again! Jk, james @priya Aw
Slide 60: OKR Goals
OKR GOALS My Everyone's OKRs le Setu Objectives and Key Results Q3FY'18 — Switch cycies (07/01/2017- 07/01/2018 Active Cycle Lifion User Experience s 6.89 average kR Score Redesign and launch our new landing page Assigned to: Homepage Taskforce ‘Test existing landing page and sub-pages on external u
Slide 61: Your Pulse Survey is available
11:44) Friday, September 26 Your Pulse Survey is available Please take a moment to fill it out
Slide 62: Engagement Pulse
ail ADP 9:41 AM < Engagement Pulse Please take the survey for Homepage Taskforce sent by Britt D’Amata Please answer all 8 questions by selecting the appropriate action 1am really enthusiastic about the mission of the company. At work, | clearly understand what is expected of me. Neither disagree no
Slide 63: Engagement Pulse
ail ADP 9:41 AM < Engagement Pulse Please take the survey for Homepage Taskforce sent by Britt D’Amata Please answer all 8 questions by selecting the appropriate action 1am really enthusiastic about the mission of the company. Strongly Agree At work, | clearly understand what is expected of me. Stro
Slide 64: Engagement Pulse
Search Q ENGAGEMENT PULSE 4 Pulses to Complete Employee Experience SCRUM View team profile Launch new survey Engagement Pulse Survey Completion Submitted Engagement — aug? 2018 wre ae {r=} Coaching Guide nat Engagement level Fully Engaged 100% 50% | 9; 92% 80% o% 04/01/2018 05/01/2018, 08/01/2018 o7
Slide 65: Wisely notifications
65 © WISELY 5 min ago Congrats! You've just been paid fora completed project in WorkMarket. Slide for more © WISELY 5 min ago Congrats! You've reached your vacation goal amount. Have a good trip! Slide for more A? ‘A more human resource?
Slide 66: Savings Goals
$8,300 Total Saved Emergency Fund > $5,000 FIC SAVINGS GOALS. Student Loan $200/month $2,000 ot $10,500 > $200/month $500.00/month Trip to Aruba $1300 >
Slide 67: Next Gen Platforms Are Live
NEXT GEN PLATFORMS ARE LIVE NEXT GENERATION PLATFORM TIMELINE Today: Pilot FY19: Roll-out FY20+: Scale + Live with pilot clients in + Sell 15 - 25 North North America America clients © pe 50 - as North * Growing platform + Start global expansion meiiee ce + Live with pilot client in + Deploy in Nort
Slide 68: We Have Already Made Significant Progress on Strategic, Cloud-Based Platforms
WE HAVE ALREADY MADE SIGNIFICANT PROGRESS ON STRATEGIC, CLOUD-BASED PLATFORMS (% of US HCM Clients/Revenue‘) Clients Revenue <1% 10% 73% 85% ico 90% 27% 15% FYI1 3018 FY11 3018 Cloud sNon-Cloud 1. Excludes non-payrol clients and revenue BUILDING ON MOMENTUM IN PRODUCT AND TECHNOLOGY: vy Completed do
Slide 69: Tom Perrotti
2018 INVESTOR DAY Tom Perrotti Copyright © 2018 ADP, LLC
Slide 70: We Are Positioned to Benefit from the Scale and Reach of Our Distribution
WE ARE POSITIONED TO BENEFIT FROM THE SCALE AND REACH OF OUR DISTRIBUTION $1.65B NEW BUSINESS BOOKINGS" We sell more HCM every year than any of our direct competitors 1,600+ INSIDE SELLERS? We are growing our inside sales organization to capitalize on digital sales and share of wallet ‘A mora human
Slide 71: We Drive Bookings Growth Through Headcount, Productivity and Innovation
WE DRIVE BOOKINGS GROWTH THROUGH HEADCOUNT, PRODUCTIVITY AND INNOVATION NEW BUSINESS BOOKINGS GROWTH FY11 FYI7 FY21F BALANCED SET OF GROWTH DRIVERS HEADCC au NEW PRODUCTS HEADCOUNT PRODUCTIVITY & SERVICES Copyright © 2018 ADP, LLC
Slide 72: Seller Headcount — Leveraging Flexibility and Efficiency of Inside Sales
1. SELLER HEADCOUNT — LEVERAGING FLEXIBILITY AND EFFICIENCY OF INSIDE SALES INSIDE SALES CONTINUING TO SHIFT OUR ADVANTAGES MIX OF SELLER HEADCOUNT TO INSIDE SALES Buyer Speed & Share of Preference Flexibility Wallet iPaeea cacy Simplify the Reduce sales Maximize Improve buying cycle time and ~—- mo
Slide 73: Seller Productivity — Growing Partner Channels
2. SELLER PRODUCTIVITY — GROWING PARTNER CHANNELS GOING BROADER AND DEEPER WITH PARTNER CHANNELS of down-market sales came of the top 15 benefits brokers have _of up-market sales were influenced by from partner channels in FY18 1H partnership agreements with ADP a PE or ERP relationship in FY18 1H E
Slide 74: Innovation — Equipping Sellers with Differentiated Products and Services
3. INNOVATION — EQUIPPING SELLERS WITH DIFFERENTIATED PRODUCTS AND SERVICES RECENT ORGANIC ACQUISITIONS INNOVATIONS Tupe | S028 CSM Work Market HCM Differentiators Increasing win rates e e e e e New Markets Opening up new markets ee oe @ >) ‘A mora human resource Copyright © 2018 ADP, LLC
Slide 75: Investor Day 2018
2018 INVESTOR DAY Copyright ©2018 ADP, LLC
Slide 76: Investor Day 2018
2018 INVESTOR DAY 2 2 ee
Slide 77: Maria Black
2018 INVESTOR DAY Maria Black Copyright © 2018 ADP, LLC
Slide 78: Clients Have Wide-Ranging HR Needs
CLIENTS HAVE WIDE-RANGING HR NEEDS _ + ADPHRO. _ - ~ - . gr ADP OFFERINGS Sa 7 Career and S 7 4 Individual NY Compensation ¢ Modules and -—-Development Performance N 7 EE Recognition m7 Management N \ENT NEEp, 4 hovers “a : cot = N | Coaching Alignment / Administration Giving Employees Managing oa \
Slide 79: Client Needs Are Unique and Evolving
CLIENT NEEDS ARE UNIQUE AND EVOLVING DENISE Clients often look similar, but needs can vary based on business circumstances and lifecycle. As client needs evolve, they may prefer to engage their HCM partner via a different model. Copyright © 2018 ADP, LLC
Slide 80: Client Needs Are Unique and Evolving
CLIENT NEEDS ARE UNIQUE AND EVOLVING ADP Offeri €ontinuum ?
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