David Ossip: Well, the focus at the moment is to get Germany online. We’re starting to do the implementation of the charter accounts this year. And as we go through, it will go through a limited release to GA by the end of the year. We’ve already as you know got quite a backlog for customers in Germany. At the same time, we are extending our footprint across APJ with the countries that we already have acquired. So we launched Singapore last year and there are a few GAs around that are very similar in nature to Singapore that we probably will add. And we’re continuing to invest in our global payroll interface, which allows us to if you like bring the engines as you know we’ve already acquired into the Dayforce platform.
Robert Simmons: Got it. That makes sense. And then can you talk about the competitive landscape? Have you seen any changes in the last three to six months that you’d call out, or is it pretty much business as usual?
Leagh Turner: You know that we play in a variety of different segments, right? So I would say, it’s not changed demonstrably. But we’re playing €“ in the emerging €“ we had great growth in the emerging market, very traditional competitors there. In the mid-market, which is very clouded space. I would say, we continue to see relatively the same competitive landscape. But when we get up into the top end now, I would say, typically we see the three large ERPs, who we are now in the Gartner Magic Quadrant, leadership quadrant alone with. And many of our wins that were noted in the press release, the global auto parts manufacturer as an example was a win against UKG Workday SAP and ADP. When you look at the deal that we did in Australia and New Zealand, it was actually a multimillion dollar deal, done with a global multinational that does provisions of explosives and oil and gas €“ for the oil and gas and mining markets.
That was a deal that was done in 17 days competitive against ADP partner-led. But I would say the one thing that you’re seeing more demonstrably than perhaps in the past is that because we’re working with partners so much, our deals are really pre-qualified and we’re not competing to the same degree that we might have in the past. And our sales cycles are accelerating. As a result, we’re able to maintain our value not only to our customer but to Ceridian.
Matt Wells: Thanks, Robert. Our next question comes from Siti Panigrahi from Mizuho.
Siti Panigrahi: Great. Thanks for taking my question and congratulations. Great quarter. David, when you look at enterprise momentum, it’s very impressive. And I remember we started investing pre-COVID. For the last few quarters we are seeing this large deal size momentum. So how is the pipeline right now heading into 2023. This enterprise deals versus 2022 last year. And remind us like what’s the deal sales cycle time for these large deals?
David Ossip: So thanks very much for that. So look the metric that I would point to which Leagh spoke to is that the average deal size went up by 22% last year. There are a few things that are running kind of in parallel would be here. First of all, we have a kind of in-seat large enterprise and enterprise sales team. And so the pipeline that has been generated by that team and the business development organization over the last year means that we go into 2023 with an enterprise pipeline that is several times larger than the one that we went into at the beginning of 2022. The second is we’ve made tremendous progress with the system integrators and we’re seeing more large deals being sourced by the system integrators. Leagh spoke about a few of those, the large global automotive manufacturer that was sourced by one of the large SI’s.
The Canadian airline organization. That was also sourced by another very large SI. The chemical organization based out of Australia that was also sourced by another SI. And so we’re seeing now the pipeline being positively influenced by the SI channels which as you know we’ve been investing in for probably the last three or four years. So when you take all of those together, we go into year with a much healthier and much more robust sales pipeline. In terms of the average deal size it really varies. If I look at the chemical company that was a lightning quick, it probably was somewhere like 12 to 16 weeks from identification to actually contracting. If I look at the airline company, which also is about 20,000 employees I think that was probably about six months at most in terms of the time to move through the pipeline.
But I think those are outliers. As you would expect in the large enterprise space it would be typically 12 to 24 months to mature those types of opportunities. One other point I would make on the large enterprise side, has to do with the implementation. And we’ve gotten very good at taking very large populations live very quickly. The large consulting company that, Leagh spoke about which is upwards of about 50,000 or so employees. The project kicked off in April and they went live in December. And that’s not an anomaly at all. So I’m very encouraged with what we’re seeing in the large enterprise basis.
Siti Panigrahi: That’s great color. And as a follow-up to that, you talked about SIs getting involved in the deals. Is that the reason why the professional services, revenue Dayforce professional services revenue was up 3% year-over-year, or is there anything else? And how should we think about professional services revenue for 2023?
David Ossip: Yes, that is correct. I don’t think it’s — I think 3% you’re talking about is inside the actual quarter. But if you look at it for a fiscal basis, it was actually up by 14% year-over-year. But yes, we are trying to move more-and-more of the implementations to the system integrators. And the number of projects that the system integrators are now primarily, I think is 15% of the overall amount.
Leagh Turner: Yeah. 14%.
David Ossip: 14%. And so we would expect that to grow quite significantly again, in 2023.
Siti Panigrahi: Great. Thank you, congratulations again.
David Ossip: Thanks, Siti.
Operator: Our next question comes from Matthew Pfau of William Blair.
Matthew Pfau: Hey thanks for the taking my question. I wanted to ask a few on the ideal talent marketplace. So how are you thinking about this opportunity in terms of its size? When would you expect this to start contributing to revenue meaningfully? And then, how do you go about sourcing labor for this product in a tight labor environment? Thanks.
David Ossip: So thanks for the question on that. We’re still building out the actual products. It will be some time before we see a revenue benefit from it. In terms of where we are, we expect to be able to take the charter accounts live in the Q3, Q4 time line. In terms of the sourcing of the actual labor there are already two classifications of people. We call the first known employees which would be the active employees of the company as well as the alumni of that company. And then the second categorization will be something we call trusted employees which are people that we have done the background screen for we’ve done the use the able skills engine to validate their particular skills so we can do the actual job matching. In terms of the identification of the charter accounts, we’ve been quite active in speaking to our clients and getting them to a stage, where we should be in a position to start contracting with the first few customers in the next few months.
Matthew Pfau: Thank you. Appreciate it.
Operator: Thanks, Matt. Our next question comes from Michael Turrin of Wells Fargo.
