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Author's profile photo J. Pazahanick

Business ByDesign and Human Capital Management

There was a lot a talk at the recent Sapphire event on how SAP’s Business ByDesign had passed 500 customers and it is becoming clear that this will be a core area of focus for SAP going forward.  SAP Business By Design is a Multi-Tenancy Software as a Service (SaaS) offering that is focused on midsized companies with 100-500 employees that per SAP “Are seeking a complete solution with limited IT resources and budget”.  It has an On-Demand deployment model, monthly subscriptions and is currently available in the US, UK, Germany, France, China, India, Austria, Switzerland and Canada.

This article is going to focus on Business ByDesign from a Human Resources perspective as I believe it and the upcoming Career OnDemand which uses the ByDesign platform is a key part of the future for SAP and SAP HR. The Business ByDesign solution for HR helps midsized companies support their organization by providing functionality around people master data management, organizational structure management, personnel administration, time and labor management, compensation, payroll, employee self-services and management self-services with integration to other core operations such as accounting and project management.

Some of the key features of the offering per SAP are as follows:

• Corporate organizational management – Dynamically create and manage organizational structures and make changes to support business change

• Human resources – Centrally manage and execute personnel administration tasks, enforce company-wide compensation structures for different employee groups, and access and update employee compensation data

• Self-services – Let employees perform common tasks without involving your HR staff and give managers departmental visibility and the ability to run reports

• Compliance – Comply with regulations and industry standards, even as regulations change

• Analytics – Gain a high degree of process and data visibility and facilitate decision making

Some of the key business benefits per SAP are as follows:

• Simplify people management by automating administrative tasks and integrating HR processes with those of other departments

• Increase efficiency by implementing self-services so your employees and managers have more control over work activities

• Ease adaptation to change through flexible and virtual employment models that let you respond to globalization and increased competition

• Enhance compliance with country-specific workforce requirements by defining rules for new hires that specify particular system and data access rights

• Improve resource management by managing resources and staffing for internal projects and tracking work hours of external resources

Shown below is a screen shot of the self-services functionality to give you some perspective of Business ByDesign’s attractive user interface. I got this from the SAP Business ByDesign website which I would highly recommend joining as it has a wealth of information.

My initial thought is that the current offering is light on HCM functionality but I will preface that by saying my background is working for large companies using the SAP On-Premise HCM offering which is very rich in functionality so this may be sufficient for what mid market customers need. It is important to note that SAP plans to open up the ByDesign platform to their partners and customers so they can extend the offering and I would expect this to provide more specific HCM functionality much like Kaba has done around external time and attendance functionality. I would expect more HCM specific functionality to be offered as Business ByDesign 3.0 is expected to be released in August, 2011 and version 3.5 in January 2012.

Overall I am excited about the direction SAP is going with their Multi-Tenancy Software as a Service (SaaS) Business ByDesign offering as well as the upcoming Career OnDemand offering which I hope to write more about once SAP gives me the okay (currently under NDA).

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      Author's profile photo Jarret Pazahanick
      Jarret Pazahanick
      Blog Post Author
      Good Discussion from a Linkedin Forum on this article and thought I would share.

      Sven Ringling -Excellent summary. Thanks for this - have been looking for exactly this info 🙂

      So, the solution doesn't really offer significant talent management / recruitment functionality, is that correct?

      What I find difficult to get my head around is the idea of SAP relying on partners to enrich the solution. This model works for traditional on premise or single tenancy hosted solutions. However, if various partners are required to build a core HCM solution (rather than having partners for payroll or other non-core stuff as Workday has it), will the big benefit of SaaS still be there: pain free, low risk, low cost updates because everybody is on the same version and same code base.

      The ERP world has a history of showing boxes in ppt presentations falling neatly into place next to each other and then believing actual pieces of software behave in the same way. Am I too cynical here? Any insights or experience with SAP on demand upgrades, when various partner solutionds are involved in at the core of the module?

      Jarret Pazahanick - Hi Sven

      I just started digging into the offering and did not see any significant talent management or recruiting functionality.

      The partner model will be one of the keys to Business ByDesign success in my opinion. They have talked about having 50 solutions and 500 in the pipeline but I have no exposure as to how many are HR related. Not sure how it will work in reality but I know that SAP is going to offer partners a platform as a service with a full solution lifecycle that includes access to a dev tenant to build and they will release after testing to a app store.

      Since this is all so new I think you being cynical is well placed but SAP has a lot invested to see this work. Just hoping that SAP HR isnt the ugly step-child that gets left behind as I have seen it in on-premise at times.

      Sven Ringling - I like the idea of having a kind of an ERP appstore and I think, if managed well, it can take of. However, these add-ons all need building upon the same core. So, if the core is missing all Talent Management, any add-onsjust drift in space freely. You can have one big TM add-on, but then that's a bigger part than the "core" and all other add-ons (and some of the stuff provided by SAP) need to build on data held in the TM - or to put it differently: SAP on Demand HCM would need to become an add-on for that TM solution rather than see other way round - I can't see SAP selling their software in the Taleo app-store 🙂

      Well, I rely on SAP now really driving this solution and coming up with a pragmatic, but well rounded HCM core in the not too distant future. A good start seems to have been made.

      some anecdote explaining some of my cynicism (other explanations comprise old age and living in Britain 😉 ): I remember being invited to the presentation of the first SAP SME solution (whatever it's name was) back in the 90s and in the last coffee break I asked the product manager, when they would talk about HR. He looked puzzled and said as far as he knew there was no HR component at all. I showed him the brochure coming with the invite, which featured a solution overview including HR - leaving him even more puzzled. I later confirmed with SAP that they would resolve the problem: the brochure would be changed not to talk about HR any more...

      Well, SAP has come a long way since and I'm hopeful!

      Author's profile photo Former Member
      Former Member
      What I like most about SAP's direction, is the innovation behind the thought process.  Whether you are a large or a small business, the concepts behind some of SAP's new designs for HCM are relevant to the future workforce we will need to attract and retain. 
      Author's profile photo Jarret Pazahanick
      Jarret Pazahanick
      Blog Post Author
      We are both fortunate to be part of the co-innovation process and have some early insight into the direction SAP is going with the HCM OnDemand products. I think the finished product will be a very strong SAP offering if SAP executes on their end as getting insight from customers BEFORE development starts is smart business.