There is a lot of excitement and speculation about ‘cloud’ solutions and how it will change the business. I started to think about how it will change the future of SAP HCM consultants and started putting the pieces together. Please feel free to share your experiences and comments.
SAP R/3 (along with HCM module) has led enterprise solution for almost 20 years when it adopted the cutting-edge client-server architecture. The reason for rethinking HCM solution is due to the paradigm shift from client-server to cloud computing.
Cloud-based Solution
Cloud-based Solution, in our context, means that the solution provider hosts the software, builds the solution template (their intellectual property), configures it for the client and maintains it (ideally for eternity) for the client. The client doesn’t own any part of the solution. They pay for the service they receive. In simple terms, the client uses and pays for services like Personal data changes (e.g. Employee Name Change, Employee Address Change), Employee transactions (e.g. Hiring, Promotion), Analytical reports, etc…
Workday and SuccessFactors are examples of cloud-based solutions.
On-Premise Solution
What do we call the existing solutions and differentiate it from ‘Cloud computing’? The current model where the client buys/owns the licenses, hosts the software on their own servers, configures and customize it to their requirements, maintains it themselves is now called ‘On-Premise’ solution. The client owns the complete solution.
SAP HCM and PeopleSoft are examples of On-premise solutions.
What are the factors that have generated interest in cloud-based solution now?
- Cloud-based solution need high-speed and reliable internet connectivity. In the US and many other parts of the world, high-speed & reliable internet connection has become the norm.
- HR wants cutting-edge technology to enable employee engagement, talent management and other critical initiatives but don’t necessarily have the budget for it. Cloud solutions come enabled with built-in mobile solutions so HR doesn’t need to spend trying to design and develop them with their own IT departments.
- HR wants to keep their system up-to-date and compliant but might not have enough resources to do it in timely fashion. Cloud solution providers keep the system up and complaint. Workday even has a social media inspired community where clients vote for the features they want in the next release
- HR wants employee and managers to have better user experience and use more self-service but they might be on the ‘high priority’ list of their IT departments. Cloud solutions are able to give state-of-the-art user experiences and update it regularly.
Cloud solution provider:
- provide same services to multiple clients (employee name change, employee address change, etc…)
- have same hardware setup for all clients (scalable hardware at low-cost)
- upgrade software for all clients at the same time (less maintenance of different versions/ old versions)
- assign resources to features that most clients vote for
To be continued…
