Innovating Retirement: How ADP Uses Machine Learning to Plan for the Future
As one of the country’s leading HR technology companies, ADP uses its unmatched data in exciting and new ways. We had an opportunity to catch up with two people critical in recognizing the opportunity to innovate and create a machine learning product for Retirement Services.
Hemlata R., Director of Product Development, oversees the entire product development process. In addition to managing scrum masters, architects, developers, and tech leads, she also heads web development, mobile development, and the machine learning strategy for the entire Retirement Services team.
Sanjay V.R. is the Lead Application Developer and oversees the machine learning practice within Retirement Services.
We asked them how their small team creates cutting-edge technology to build data-driven solutions for their customers, and here’s what they said:
First, let’s hear a bit of what brought you to ADP.
Sanjay: I started at ADP as an intern while I was attending school in upstate New York. Once I completed my internship, I actually had multiple offers to join other companies. I chose to stay at ADP because getting good opportunities is one of the most challenging obstacles in today’s job market, and at ADP, if you put in the work, getting rewarded is the easiest thing.
Hemlata has been my director for 80% of my career, and I’ve been able to turn to her if I have an idea or if I want to pick up a new role or responsibility. She’s always encouraged me. My senior leaders make sure to recognize me for my hard work. I’ve been promoted three times in my three years at Retirement Services, and that speaks volumes.
Hemlata: I also had several offers when I was looking for a change after my last job. I was attracted to ADP because I’d heard that it was moving toward being more of a technology company that valued innovation—and that its leaders prioritized diversity and inclusion. I’ve seen first-hand that you don’t have to have an impressive title to be a leader here. You can be a leader at any level. You can innovate at any level, and ADP supports and invests on that front. I’m so happy and thrilled that everything I had heard about ADP turned out to be more than true.
Speaking of innovation, tell us about the Retirement Services product you built.
Sanjay: People Like You is a new feature based on machine learning algorithms; it helps participants better prepare for their retirement by offering benchmarks on how people similar to them are planning their retirements. For example, we can show you what percentage of your coworkers are contributing to their 401(k)s and how much of their income they’re contributing. Maybe you contribute 5%, and when you see that your peers contribute 8%, you have the confidence to invest more.
In the retirement industry, advisors usually group people by age or salary and then start giving advice. We wanted to answer the question better and offer advice based on what others in similar socioeconomic situations are actually doing.
Hemlata: ADP pays one out of six Americans; the amount of data we possess is unparalleled. When I joined the company, we discovered that many of our clients’ employees do not contribute to 401(k)s. Since we work for Retirement Services, we saw this as a problem. People often look at their peers and follow them, so we asked ourselves how our data could help create a solution.
How did you go about building People Like You?
Hemlata: We tried to combine the mind and the machine by leveraging our experts’ expertise at ADP and machine learning.
Sanjay: We have folks at ADP who have over 20 and 30 years of experience in Human Resources and Retirement Services. As much as data is our strength, our people and their expertise are equally valuable. So first, we talked extensively with our internal stakeholders since they already know the ins and outs of the industry intimately. Then we conducted market research to understand people’s motivations and concerns better about retirement investing.
After that, we went back to our data sets—everything we have from our payroll and retirement resources—and we started looking at this socioeconomic information to see any relevance between multiple parameters. For example, does age or compensation influence your retirement decisions? What if you’re married, single, or have kids? Based on our internal and external research, we were able to identify somewhere around 30 factors that make an impact; we then narrowed those factors based on the extent of their influence on an individual’s decision. Once we started analyzing that data and built models to create the personas, we realized that we had something worth integrating with our existing retirement products.
When we began this project, it started on a small scale. It was just one other data scientist and me. The two of us created the machine learning part of it, but as we built specific pieces of code for the APIs, we pulled in engineers as we needed them.
Were there any complications you had to work through?
Hemlata: The tricky part for me was to make sure that we were compliant with all the security olicies. People trust ADP. It’s our brand. That’s why they come to us for payroll, compliance, workforce management, legal, and security solutions. ADP knows what to do and takes excellent care of its customers, and we take this to heart and always obtain the consent of our clients and employees before we include their data. We’re extremely careful to keep all the data anonymous and not look into any specific client or individual employee data.
Sanjay: Yes, ADP is very sensitive toward privacy laws, so we were very specific about reading only as much data as people were comfortable with. One of the biggest advantages we had was that we partnered with ADP’s DataCloud team. They acted like a data custodian in the project and were responsible for making the data anonymous. They also made it possible to identify an employee—only with their consent—if I needed to access that data to connect specific pieces of information.
I’m a millennial, and I’m one of those people who always clicks on “Do Not Sell My Info” on websites. So, I’m particular about my data, and I think I always had that in the back of my mind. DataCloud made my job easy in that regard.
How do you think machine learning will affect your future work?
Hemlata: We are looking at leveraging this concept of combining the mind and the machine on other aspects of our business, such as compliance processes. As of now, we have used descriptive and prescriptive analytics. Next, we are planning to use predictive analytics to help our clients predict the upcoming required actions. ADP and our clients can solve any predicted problems upfront. We’re always trying to see how we can take our ideas and solutions to the next level.
Sanjay: This is the beginning of an entirely new way of thinking about improving our clients’ experience. We want to look beyond traditional solutions to ensure our clients and their employees feel empowered by our products. ADP also has a general excitement to identify pain points to be resolved and processes we can enhance using machine learning.
Speaking of your customers, do you see any results from People Like You? Are more people signing up to contribute to their 401(k)s?
Hemlata: The results are way better than what we expected. Employee contributions and new enrollments have definitely increased. We also saw this product gain so much attention internally within ADP that several other teams contacted us to see how they could leverage similar solutions within their departments. It’s been fascinating to see the outcomes and the interest from all the other teams.
Sanjay: It’s funny because a bunch of my peers was like, “Oh, I don’t really need a 401(k). I’m too young for that.” Then, two or three months after we released People Like You, someone remarked during lunch, “Hey, did you know that I just signed up for my 401(k)?” Then others joined in—four people also signed up. It’s just a wonderful experience when you hear people say your solution impacts their lives.
After we launched, Don Weinstein pinged me on Webex Teams and said what a great job I’d done and that he was looking forward to what I’d build next. It was a total fanboy moment for me.
Hemlata: This goes to show you what I was saying earlier. At ADP, people don’t have to be a leader by title. If there is an idea, and you can think big and innovate, that’s all you need. Once you have that, you can take it to any level, and people will be so open to talk to you, encourage you, and help support any of these thoughts. It’s really amazing to see that!
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