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Making Sense of the SAP HR Landscape in 2015 Part 1: Help! What do I do?

I just got back from the SAP HR 2015 Conference in Las Vegas.  I’ve been to quite a few different SAP conferences over the years and I like to think of this one as my favorite.  It is a smaller, more specialized conference where a lot of people know each other and have a lot more in common sharing not only the technical connection with SAP but also the functional knowledge of HR professionals.  Some of these friendships have spanned decades and it is amazing to see how relaxed and how much fun this little group seems to have.

But not everything is easy going in this little community anymore.  There’s quite a bit of churning in the past few years, and it seems to be building.  I’ve been getting people coming by the booth or asking me at dinner “What do I do?”

They are of course referring to their confusion over a few things:

  1. In December of 2011, SAP purchased SuccessFactors for $3.4 Billion. This changed the market significantly, particularly in talent management, and the change is spreading more into core HCM as Employee Central continues to be developed into a more mature product
  2. SAP continues to encourage its customers to move to the cloud (does this mean SuccessFactors or HANA cloud?) and announced in October 2014 that it will end mainstream maintenance in 2025.  Some Java technologies will end sooner in 2017.
  3. A bit contrary to their message of ending on-premise support, SAP continues to release new functionality for SAP HR, most recently Fiori Apps and HR Renewal 2.0.

As a result of these developments, SAP HR customers now have a sea of options from which to choose.  Speaking with many people over the past few conferences and with current customers, I’ve been seeing people in these different camps:

  1. The Early Adopters.  These people are going full cloud ASAP (no methodology pun intended).
  2. The Holdouts.  Customers in this camp still have their eyes on the big bucks they sunk into their existing on premise SAP HR solutions and want to get every penny out before they switch platforms.
  3. The Hybrids.  Many customers were quick to install SAP Core HR products (PA/OM, Benefits, Time, Payroll) but didn’t necessarily like the on-premise talent management suite and are jumping on the SuccessFactors solution to meet those needs.
  4. The Lost In Space.  Given the wide array of options out there now for going cloud or staying on premise, investing in one or both seems a tough decision with so much churning going on.

While some of us in the first camp may be admirably intrepid in our decision to move forward, I think most people have a little bit of category #4 in our blood.  This blog series is designed for those of us feeling a little lost.  To help alleviate a little of that, my advice to you is this:

  1. Don’t Panic! I had a great dinner conversation with a younger professional who was just starting to get exposed to all this and was concluding that any investment down this career path was futile because we’ll all just have to re-tool in 10 years.  I responded by letting him know that I’ve had to re-tool myself probably 5 times in the past 10 with all of the different product versions, enhancements, new technologies, and fads that have hit the SAP HR market just to survive as a consultant (4.6C, ITS, Netweaver Portal, ECC, Web Dynpro JAVA, Web Dynpro ABAP, UI5…).  If you don’t like change, Information Technology is not the career path for you! The end of support SAP HCM on-premise is a long way off still.  While you should be thinking about your HR Technology strategy over the next few years, no one is pushing you into anything right now and you could very well be retired or have decided on an entirely new career path by the time support ends.
  2. Get Educated.  I’ll be doing this blog in a series that covers some of these different trends in more depth.  Before you make a decision on which route to take, you should be asking things like: “What is it going to take to learn this technology and re-tool myself and my co-workers?”  “How much would an implementation cost up front?  Long term?”  And all to often seemingly last on the list – “will the users adopt it and make it a ‘Successful’ implementation?”
  3. Have fun.  Talk to your colleagues.  Read blogs. Attend conferences featuring Jennifer Lopez.  The world is not ending in 2025.
  4. Execute on your terms.  Remember there is not one universal answer for everyone.  Each customer is going to have a different path over the next several years that works for their differing existing systems, cultures, users, budgets, and business goals.

In Part 2, I’ll be covering SuccessFactors.  If there’s something specific you’d like me to go into detail about, please let me know by posting your comments here!

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      Author's profile photo Luke Marson
      Luke Marson

      Interesting summary Michael.

      I would just add that this statement is a bit misleading:

      SAP continues to encourage its customers to move to the cloud (does this mean SuccessFactors or HANA cloud?) and announced in October 2014 that it will end mainstream maintenance in 2025.  Some technologies like Java will end sooner in 2017.

      In October SAP announced that they are extending mainstream maintenance until 2025 from 2020. Your statement implies that they just introduced an end date. The reality is that SAP will probably extend mainstream maintenance for a third time in the early 2020's beyond this date (the original mainstream maintenance end date was 2017).

      I am interested to hear what inspired you to say that "SAP continues to encourage its customers to move to the cloud". Sometimes there can be mixed-messaging from SAP and non-SAP speakers, so it would be interesting to get your take. SAP mentioned during the conference that customers who are happy with their on-premise should not move to the cloud (in fact, Joachim Förderer said this while I sat on a panel with him). SAP have made it clear that they will not invest in on-premise Talent Management and I believe that customers should be encouraged to move to the cloud, but I don't think it's a given that SAP are encouraging all customers to move.

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Hi Luke.  Thanks for the post!  You are correct they did extend from 2020 to 2025.  I agree, there is always some play in how long maintenance will last and these things do end up getting extended sometimes.  I think SAP will wait and see what customers are saying and doing before committing to any more extensions.

      I mentioned the "encouraging" customers to the cloud because this is the phrasing and context SAP has used at Partner meetings and in official communication with customers.  For example, take a look at the FAQ section on the 2025 maintenance site.  It mentions "...offering customers choice and a simple, non-disruptive route to the cloud".…

      They are not being too shy about this direction. 🙂

      Author's profile photo Imran Sajid
      Imran Sajid

      Hi Michael,

      Thanks for sharing. I like the topic and I am looking forward to seeing more of this blog series.