Scottsdale, Ariz.-based construction human capital management (HCM) software Arcoro is broadening its product set and deepening its already substantial connections to the industry, most notably announcing, tit for tat, its own payroll product as payroll giant ADP launches a construction HCM product that will compete with its frequent integration partner.
Arcoro is adding HCSS and ABC Insurance Trust to its trusted partner network and expanding its partnership with Aktion & Associates. Arcoro is also launching its payroll solution to extend their Core HR module, streamlining payroll even more than the company already has with its standard integrations with external payroll vendors, including ADP. The new functionality includes construction payroll processing, tax filings and compliance-related reporting.
“Arcoro is extremely excited to announce our very own Construction Certified Payroll Module and our partnership with HCSS and the ABC Insurance Trust,” Arcoro Senior Vice President of Sales & Strategy Chad Mathias said in a statement from 2023 Partner Conference and Arizona Construction Workforce Management Summit held in Phoenix. “In addition, we are excited to expand our relationship with Aktion & Associates as our first true reseller within the Sage and Acumatica eco-systems. These four key announcements reflect Arcoro’s commitment to our clients and the construction industry. We anticipate a warm reception from the construction marketplace and look forward to an exciting 2024.”
Arcoro has also added partners including heavy/civil construction software leader HCSS and the Associated Builders and Contractors (ABC) Insurance Trust.
Here is an Arcoro overview from Vice President of HRIS Software Sales Ric Chaney.
Deep and Broad Construction HCM Software
IRONPROS will have a separate briefing and examination of the new payroll solution, but already, Arcoro’s human resources software addresses the full employment lifecycle including:
- Getting enough qualified applicants in the door and hired. The Arcoro Hire module includes an applicant tracking system (ATS) and onboarding tools—important since well-executed onboarding helps employees contribute more immediately, and also plays a role in retention.
- Construction HR operations are addressed with Core HR Management, Included in Core HR is construction-specific performance management software that, for instance, enables employment reviews that can be project-specific, based on feedback from that project lead. This is bundled with functionality for benefits, time tracking, compensation and safety compliance.
- Time tracking with Exaktime, Arcoro’s time tracking app, compares favorably with standalone time clock applications when it comes to mobile functionality for location-aware time reporting, up to and including photo ID capture to prevent “buddy punching.” This streamlined approach to gathering data informs a set of reporting and analytics tools and the rest of the Arcoro solution.
“Arcoro offers a modular-based HR system that spans the entire employee lifecycle from hire to retire,” Arcoro Vice President of Channel Development Bryan May told IRONPROS in an August 2023 product discovery call. “No two customers purchase the same product. They are able to pick and choose which modules they want to start with. And then we will add and grow with them over time as their needs or level sophistication changes. So too, can the support we provide. We have 10 modules within our solution.”
And then for contractors who may not feel the need for full-blown construction HCM, there is Exaktime, which came to Arcoro in a 2018 acquisition by its parent, Providence Strategic Growth.
“The Exaktime brand has stood alone for a long time,” May said. “And so we have kept the Exaktime brand.”
While Arcoro addresses the organizational pain points contractors face as they scale a workforce, Exaktime takes the offering deep into small-to-medium business (SMB) territory.
“It does scale,” May said. “Our smallest client has four employees, and our largest are in the 10s of thousands. It does have quite a bit of appeal. What it does very well is deliver a native mobile app that works online or offline, so no matter the most remote areas that contractors are working, people are able to track their time. And as soon as their device comes into contact with data, that time is synced right to the cloud, and and the back office team has access to it. It's purpose built for construction, helping you identify what people are doing, where they are, and for how long. It does a great job when it comes to job costing, helping not just with payroll, but also with actual job cost and how that compares to your project budgets.”
Modular Construction HR Software
Contractors tend to approach Arcoro’s core HR functionality differently, depending on size, in ways that closely mirror the employee lifecycle.
“Our contractor customers below 100 employees tend to be most focused on the front of the employee lifecycle—recruiting, onboarding and safety,” May said. “And because they have a lot of self-perform workers in the field, they will also often opt for time tracking. When you go upmarket, the level of sophistication increases, and it's harder and harder to manage people on paper and spreadsheets. So larger contractors are looking for more self-service functionality that will help them maintain the employee through self-service access to pay stubs and time off requests and change management for benefits enrollment.”
But even before that, Arcoro’s construction ATS would have helped the contractor recruit and onboard each employee. This process is particularly challenging in construction.
“From a recruiting perspective, there's four sources that influence a hire traditionally, that is a company's website, internet job boards, social media, and referral networks,” May said. Arcoro’s applicant tracking system helps a contractor promote their jobs through all four resources with the click of a button. And now when we talk about job boards, it’s not just any job boards. Arcoro actually hosts construction specific job boards, like the one that we built with Procore, the Procore Construction Career Board.”
Hiring applicants won’t help much if they don’t stick, and Arcoro provides the tools to help individual workers positively see the company’s investment in them.
“Our learning management system (LMS) can be loaded with all the OSHA-required or recommended trainings for HR, compliance or soft skills. You can build out learning plans to help people get better in their current role and prepare for a future role. When you do those things, employees become happier with the organization, more successful, and they stay.”
As the contracting business scales up in size and complexity, Arcoro mitigates that complexity, including regulatory requirements for prevailing wage.
“There are hundreds of prevailing wage rules that contractors could have to deal with,” May said. “On the time tracking side, we're identifying which jobs may be certified or require prevailing wage. When time gets passed into their payroll system and into CMIC, for example, pay for those tasks that were performed can be calculated based on the wage tables within their payroll system. Once that time is brought into payroll, the pay calculations are done based on the pay tables that are already created within their accounting system. This is a real differentiator for Arcoro. We don't do payroll, we do HR. Payroll for a construction company best is best served in their accounting system.”
Arcoro Market and Pricing
Apart from Exaktime which can provide value to a contractor with just a handful of employees, Arcoro becomes a fit for contractors with 100 or more employees. At this point, manual processes or ad hoc solutions like Excel are no longer viable and disparate cloud solutions, even with point-to-point integrations, leave too much detail and too many processes falling between chairs.
May said the customer base was divided somewhat equally between general contractors and subcontractors. By the time a contractor is large enough or focused enough to be performing on federal projects which may bring reporting and traceability requirements through the Office of Federal Contractor Compliance Programs (OFCCP) and sometimes Women-Owned Small Business Federal Contract Program. Disadvantaged Business Enterprise (DBE) Program or Minority Business Enterprise program.
Arcoro gets the product in front of these contractors through a new sales team of 30, not including outside resellers. A team of 20 account managers look to the needs of the installed base, with white glove customer success services coming with a contract value of at least $20,000.
BOTTOM LINE: With the entry of a large horizontal software vendor into the market for construction HCM, contractors should look long and hard at Arcoro’s deep vertical functionality and roots. Extending a broad solution for an industry is something enterprise software companies have done for a long time, but that vertical extension may not go as deep as a dedicated solution. As a middle market company, Arcoro can focus on construction, and contractors can worry less about the company changing or abandoning its industry focus. And culture can matter in business software, where relationships can extend for years or decades, and here too some contractors will find the communication style and access to decision makers provided by a company like Arcoro a significant X factor. Also significant will be Exaktime, which will give Arcoro a footprint with smaller contractors with a roadmap to comprehensive construction HCM as they grow.
