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Philosophy

Philosophy
Our Mission
Our Vision
Our Special
Strengths
An Important
Challenge
Our Business Culture
Our Associates,
ADP's Success Is
Due To You
Operating Principles
 

 

Corporate Philosophy
"Each client and prospect counts; each person counts; each deed counts; and each contact between a client or a prospect and an associate counts."

ADP's objectives are sustained growth in shareholder value through ever-improving financial results, World Class Service, and being an employer of choice. We will achieve these objectives by having a total commitment to the highest ethical standards, by treating everyone with honesty, fairness and respect, and by conducting our business with the highest level of integrity. We believe in open, informal communications, hard work, and prudent financial management. These are ADP's core values, the foundation on which our business culture is based.

But a statement of values is not enough. Unless our values are consistently practiced, they become just platitudes. Consistent implementation occurs only when each of us respects the rights of others, when our actions are free from discrimination, and when each associate is accorded full equal opportunity.

As we continue to grow and as our businesses become increasingly complex, a shared, well-communicated Corporate Philosophy is more important than ever. We are not perfect. Our actions will occasionally fall short of our aspirations. Such shortcomings should be viewed as an opportunity to learn and to refocus our efforts to live up to our values and Corporate Philosophy.

Sincerely,
Arthur F. Weinbach signature
Arthur F. Weinbach
Chairman and
Chief Executive Officer


Our Mission
Our Mission is to add value to our clients by making available a broad range of mission-critical, cost-effective computerized transaction processing and information services to selected markets on a global basis.

Our Vision
1. ADP's business is based on the belief that: Each client and prospect counts; each person counts; each deed counts; and each contact between a client or a prospect and an associate counts. Each client and prospect is either prospective future business or a prospective loss. . . depending upon the quality of our products, services and associates.

2. Outstanding Associates are the key to our success. We are committed to attracting, motivating, empowering and retaining a team of exceptionally dedicated, talented associates who have a strong work ethic and results-orientation, who believe in and support our core values, and who reflect the diverse business environments in which we operate. We will offer our associates challenges, opportunities, advancement, competitive compensation and benefits, and personal training and development in an informal, fast-paced, non-bureaucratic environment that is sensitive to work-family and flexible schedule issues. We will provide technologies that enable our associates to continually meet our clients' ever-changing product needs and preferences. We want each associate to feel like an integral part of a team that is making a discernible positive contribution to ADP's success. Our goal is to become the clear employer of choice for our current and future associates.

3. We are committed to achieving World Class Service levels that exceed our clients' requirements and expectations by providing solutions that enable them to succeed in their businesses. We define service broadly, from initial contact with a prospect, to product quality, to anticipating client needs and preferences, to overall client satisfaction. It requires associates to treat every interaction with a client as an opportunity to enhance that client's perception of ADP. We are committed to investing in state-of-the-art technologies to develop, deliver and support our products and services, and advance our World Class Service vision. We see World Class Service as a journey where, whenever we approach an identified destination, we increase our objectives and raise our goals in order to become even better.

4. ADP seeks to achieve and maintain market-share leadership, primarily through internal growth of its core businesses. Internal growth will come from further penetration of our existing markets, extending our market opportunities through broader product offerings, increasing our client retention rates, and continuing our international expansion. Acquisitions and alliances will supplement our internal growth. We will continue to look for entry into new markets that capitalize on and leverage "Our Special Strengths."

5. Success is measured by increasing numbers of extremely satisfied clients, higher client retention rates, broader client relationships, increased market share, higher associate retention rates, and consistent implementation of our values and Corporate Philosophy, resulting in ever-increasing revenues, earnings and shareholder value.

6. The Marketplace (clients, prospects and competition) is the ultimate judge of performance. We want to be the market leader (in terms of quality, service, size and earnings) in each market we serve.

7. Our Shareholders expect and deserve growing profits and returns from their investments in ADP. We are proud of our record of consistent earnings growth. We seek to maintain this consistent growth without sacrificing our other important principles.

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Our Special Strengths
We have a number of strengths which we capitalize on and leverage to aid our growth, including:

  • being in computerized transaction processing and information services businesses, which are growth industries;
  • a leading market-share position in each of our core businesses;
  • a powerful financial position from which to compete;
  • solid, time-tested "Operating Principles";
  • a strong client service orientation;
  • a superb direct sales capability;
  • robust, powerful and well-controlled operations, production and communications capabilities;
  • a strong desire and commitment to be a World Class Service company and an employer of choice; and
  • a clearly articulated set of core values and Corporate Philosophy.

Our most critical special strength, the key element in our success, is our worldwide team of associates. They share "Our Vision" and help us succeed in the marketplace.

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An Important Challenge
Our business team needs to respond to constantly changing client needs, and changes dictated by the marketplace. Past successes do not ensure a successful future. Nothing can be taken for granted. Complacency is a powerful enemy. We must continuously anticipate, and adapt to, changing conditions. We must seize and exploit new market opportunities, and aggressively and consistently seek to implement "Our Vision" 100% of the time.

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Our Business Culture
Our core values are the foundation for all our activities. Our ever-evolving culture is guided by our core values, by motivated, results-oriented associates, and by our desire to be a World Class Service company and an employer of choice.

We must nurture a culture of ideas, questions, challenges, feedback and prudent risk-taking without the fear of occasional failure.

Learning must become a continuing process. We want on-the-job development of each associate supplemented with suitable training. We recognize the benefits of cross-training to provide additional perspectives and skills. It is important for each associate to participate in self-development and aid in the development of others.

We must maintain an environment for top performers to progress as rapidly as they effectively can. We are a meritocracy where advancement is based on ability. We try to fill most new career opportunities by internal promotion, while also supplementing our environment with external hires.

Involved, knowledgeable, "hands-in" management is a desirable style. Each manager should regularly spend time talking to and visiting clients, prospects and other associates to get first-hand insights from them.

To encourage an open, informal flow of communications, we support an apolitical, candid environment that quickly responds to constructive input. We encourage lateral and vertical communications, both inside and outside of formal reporting relationships. We support an environment where constructive differences of opinion are encouraged and welcome. And in the end, after differing viewpoints have been clearly registered in interactive discussion, we also recognize the need for final decisions with effective communication and implementation.

We ask each associate for more than a usual amount of conscientiousness and flexibility, because World Class Service to our clients requires us to accommodate client needs and schedules. We must always do what it takes to suit client convenience because ADP is a critical information lifeline to most of our clients. While doing so, we should also try to minimize avoidable inconveniences to our associates and their families.

Associates are expected to respect the rights of fellow associates and others. Our actions must be free from all forms of discrimination, libel, slander or harassment. We are committed to offering each person equal opportunity regardless of age, race, sex, sexual orientation, color, creed, religion, national origin, marital or veteran's status, handicap or disability.

We treat business ethics no differently than personal ethics. The same high standard applies to both. Our commitment to the highest ethical standards is supported by effective enforcement mechanisms, including a company-wide ethics program and an ethics hotline. These ethical standards are more fully articulated in our Code of Corporate Responsibility.

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Our Associates - ADP's Success Is Due To You
We have come a long way since ADP was founded in 1949. Each step has been exciting, rewarding, challenging, and a learning experience that we have collectively inherited. It is our goal to continue this exceptional journey to becoming a World Class Service company and an employer of choice, taking pride in our excellent products and services and in the exemplary character of our associates.

We thank each of you for your talent, dedication and efforts, and for the superior results that you have helped ADP achieve. Your efforts and contributions make ADP what it is today and what it will become in the future. It is your continued dedication that will ensure our success.

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Operating Principles
As a supplement to our Corporate Philosophy, we have evolved a number of operating principles. While they are not cast in stone, we feel that the following principles are critical to our ongoing success:

1. PLANNING GROWTH

Strategic Directions: We are singularly interested in products and marketplaces of substantial potential, where we can be an ever-growing leader and industry standard by offering superior solutions and providing World Class Service. We prefer markets where our solutions have significant value-added uses to clients (not mere commodity-like offerings), or where we are well-equipped to outshine competitors so that our success cannot be easily emulated. We most favor directions where we have the greatest chance of becoming the market leader, because a casual or small participant can seldom maintain an adequate return on managerial and financial resources.

Innovation Selectivity and Focus: New ideas and products are exciting. We need a continuing array of new ideas, and must recognize and reward the associates who produce them. At the same time, it takes focus and self-restraint to maintain the discipline of thinking and researching very broadly, while implementing more narrowly. Many organizations tend to pursue more projects than they can effectively handle. We must balance reward and distraction. Nonetheless, we will try more new directions than we need in order to leave room for the inevitable disappointments. And since major new projects or directions are especially difficult and uncertain, we must focus our best associates on these newer opportunities, as full-time champions.

Unless regularly challenged, many organizations tend to allocate resources by inertia and tradition rather than by priorities and results. Resource optimization requires sunsetting lower priority projects to make room for more promising opportunities.

Business Plans: Good plans help maintain consistent growth with fewer surprises. The specific objectives, priorities, strategies and processes in a plan should be initially guided by senior management, and then be directly created in more detail by each manager who must ultimately own responsibility for the results. The planning processes should be interactive and responsive to differing views.

2. PRODUCT MARKETING AND DEVELOPMENT

Continual, high quality, rapid development of new products, internal systems and new technologies is central to maintaining and enhancing our competitiveness. We must create marketing and development environments that induce greater effectiveness and faster time-to-market. We must focus our energies on staying in tune with unmet client needs and proactively addressing them. We must explore the latest innovations so that we continue to be the market leader in all of our businesses. We seek acquisitions and alliances to supplement our internal growth whenever we can effectively telescope time and/or reduce risk in the pursuit of new markets, products, clients and technologies.

3. ORGANIZATION STRUCTURE

In our business environment, the best people, best decisions, best attitudes and best efficiencies are usually attained through substantial delegation, empowerment and self-sufficiency. We encourage operational decentralization to the fullest practical degree consistent with World Class Service, efficiency, and highly automated, standardized systems. While each business unit has the obligation to inform Corporate headquarters of important issues, decisions and problems, each business unit is responsible for making all day-to-day operational and client decisions, consistent with corporate guidelines. Corporate headquarters has the responsibility to be aware of all significant events.

We recognize that certain policies and functions should clearly remain centralized to varying degrees, depending upon the need for uniformity or specialized knowledge. Regardless of location, all functions must cooperate and work together to achieve our common goals. Excess layers of management increase costs and retard communication and responsiveness. We aim to keep working units lean, small and cohesive enough to empower associates and to give them a clear sense of their mission, their accomplishments and their accountability.

4. RISK MANAGEMENT

Risk vs. Reward: We want to pursue substantial, continuing, long-term revenue growth while preserving, to the fullest degree reasonable, ADP's record of consistent earnings growth. This earnings consistency is worth protecting because it enhances our financial standing and predictability, and is an important component of shareholder value.

Evolution vs. Revolution: In ADP's businesses, most improvement is best attained in manageable increments by evolutionary changes, to ensure continued World Class Service to clients as change is implemented. Conversely, big successes in new directions, or urgent quantum gains with existing clients, will occasionally necessitate revolutionary strategic leaps. We favor the incremental approach where large numbers of decentralized activities and clients are involved, but only to a degree that does not unduly sacrifice our competitive position. We must continually challenge our activities and methods so that we aggressively upgrade our technologies, products, services and processes, and minimize the need for a catch-up revolution.

Role Before We Roll: Since many new ventures will fail, we will generally try to minimize the cost of failure to a manageable level by not acting on an unnecessarily large scale too soon. Changes that involve many clients and associates are particularly difficult and error-prone. As we change processes and automate labor, we must minimize the risk of a poor transition. We should role-model new products and approaches before we roll them to many locations, clients or associates, without forfeiting windows of opportunity that require fast time-to-market.

Accounting Principles/Financial Controls: ADP accounting should always be conservative. Financial statements are much more management tools than accounting documents. They require considerable effort to be accurate, timely and concise, with clear displays of trends and comparisons that help managers understand, control and manage the risks and opportunities surrounding their businesses.

5. SPECIAL OUTSIDE RELATIONSHIPS

Business Friends: Many prospects and clients are introduced to ADP by third-party recommendations from accountants, trade associations, franchisers and bankers. We must maintain effective and proactive communications and relations with these business friends.

Suppliers: Suppliers who are good business partners are critical to our success. We expect suppliers to earn our continuing relationship, as we must with our clients. We expect the best service and prices that a supplier is offering to any equivalent customer. We, in turn, will fulfill our obligations promptly and deal in a forthright, open manner. We should always have back-up sources.

Community: We appreciate the good fortune that our society has made possible, and acknowledge our appreciation by supporting worthy sectors of our society with both effort and money. Our pro bono activities encompass financial support (through the ADP Foundation), contributions in kind and governance. Our primary areas of philanthropy and leadership are education, health, the arts and social welfare.

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