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Now that HR2012 is firmly over and reality has begun to set it, I wanted to follow up on my previous blog 5 things I want to know about SuccessFactors and Talent Management at HR2012 with the 5 things I had learnt about SuccessFactors and Talent Management at HR2012. I won’t go into too much detail, since I hope to write a more detailed summary in the coming week. You can also read my key takeaways and thoughts from HR2012 in a blog by SAP Insider Learning Network’s Margaret Hein, Notes on HR2012, and in the cloud Avenue article The Future of (SAP) HCM Consulting and SuccessFactors. So, without further delay:

  1. SuccessFactors is not configurable (other than fonts and colours), so what plans do SAP and SuccessFactors have to enhance the solution to meet the demands of customer’s Talent Management needs?
    • SuccessFactors is configurable, but it is not customizable. This will disappoint ABAPers, developers and outsourcing companies because the development opportunities are simply not there. The solutions are highly configurable, but with all the bells and whistles enabled it is still not close enough to SAP on-premise to provide value for many SAP customers – yet.
  2. SuccessFactors claim to have an SAP integration package – does this mean that SuccessFactors and SAP will be integrated soon, or is there still a lot of work?
    • Integration is pretty non-existent right now and one SuccessFactors customer told me about their experience of building interfaces for every SAP table, including the text tables. Importantly, SAP announced that they are building a Rapid Deployment Solution (RDS) for SuccessFactors integration and intend to have a prototype ready for SAPPHIRE in May. SAP made a clear and strong point that integration is their #1 priority and they are working with several customers to develop the APIs and integration that are required to integrate SAP and SuccessFactors.
  3. Since there is little to no consultancy required for a SuccessFactors implementation, how do SAP plan to provide an “incentive” for consultancies to recommend implementing SuccessFactors to clients?
    • While there is consultancy available, it seems that most of the consultancy will be specialist business knowledge and process mapping, field mapping, integration, change management and supporting the roll-out. Intermediately there will be consulting to advise customers on what route to go (on-premise v on-demand) and how to make their way down that path. Gone will be the days of the “gravy train” (as one commenter on SCN put it) of long blueprinting phases, weeks of customizing and development and multiple rounds of testing and corrections. Clearly from a consultancy perspective the shift will move from technical to functional or techno-functional, making those who are currently techno-functional more the norm than the exception. This is likely to be the case for most SaaS and cloud offerings.
  4. If a majority of clients stay with on-premise in the long-term, will SAP still only produce “selected innovations” or would they be willing to change their strategy?
    • SAP have to invest significantly in SuccessFactors because it simply doesn’t meet the needs of their existing and potential customer-base as it is right now. There is a lot of potential in the software and SAP have not given up on on-premise, simply they have redirected their investment efforts to bring SuccessFactors up to speed. SAP will continue to provide the same level of innovations as they are now. Since EhP4, there have only been selected innovations in many areas of Talent Management, with each EhP release providing a focus on one key area of Talent Management (EhP4 for Talent Management Core/Succession, EhP5 for Compensation Management/ESS/MSS and EhP6 for Learning/LSO). Subsequent releases have only contained minor innovations for other areas of SAP and Talent Management. SAP made it very clear that on-premise will not go away, they will not force customers onto SuccessFactors and that they will remain to work with key strategic partners like Nakisa in the on-premise domain.
  5. Will SuccessFactors be license-free for existing SAP HCM customers, or will they have to pay a license fee to use it?
    • Jarret Pazahanick made a great point on a LinkedIn group discussion recently when he said that most of SAP’s recent investments, with the exception of the core renovation of the new PA/OM UI, have been in products that require additional licensing, such as Nakisa, HCM Processes & Forms, Shared. It’s fair to say that SuccessFactors will join this group of products and with $3.4bn (plus R&D investment) to claw back, you betcha that it won’t be license free.

So, I managed to get most of the answers I wanted and it will be very interesting to see what gets announced and shown at SAPPHIRE in April. I for one will be watching closely.

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2 Comments

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  1. Steve Bogner

    Great points Luke; but maybe with #3 it might be a bit different when we get to core-HR & Employee Central. It won’t be the same gravy train as on-premise SAP HCM, but replacing core-HR takes a lot of effort for process mapping, conversion, testing and change management – regardless of what technology we use. Data conversion and parallel testing for payroll alone require significant time & resources. I don’t see how those project phases/steps go away with any sort of SaaS – they can get smaller, but still significant time & effort.

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    1. Luke Marson Post author

      Hi Steve,

      Thanks for your comments. Regarding #3, this is well pointed out. I think I was referring more to Talent Management, since this is my area of expertise, so I appreciate you highlighting Core HR and Payroll. Testing and development will be the main areas where time is cut – a solid solution which is largely bug free and hasn’t been significantly customized with ABAP and BAdIs will require much less time to test and also increase supportability. But I expect SAP will still charge 22%!

      Best regards,

      Luke

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