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SAP S/4HANA is the next-generation business suite. It is a new product fully built on the most advanced in-memory platform today – SAP HANA – and modern design principles with the SAP Fiori user experience (UX). SAP S/4HANA delivers massive simplifications (customer adoption, data model, user experience, decision making, business processes, and models) and innovations (Internet of Things, Big Data, business networks, and mobile-first) to help businesses run simple in the digital economy. S/4 HANA can be deployed as on-premise edition or a cloud edition. 

The SuccessFactors HCM Suite (SuccessFactors) is the “default” HCM solution for S/4 HANA.  Customers choosing S/4 HANA as their next-generation business suite also require a next-generation HCM suite and this is the focus of SuccessFactors.  Productized integration (built and maintained by SAP) exists today so customers can connect SuccessFactors with S/4 HANA cloud edition; productized integration to connect with S/4 HANA on-premise edition is planned for 2H2015.  There are no plans to “simplify” SAP ERP HCM and future innovations will be limited, focused primarily on localization support and user experience renewal.  No changes are planned to this investment strategy.

However, some customers using SAP ERP HCM to support their HR processes may not be able to migrate their HR processes to SuccessFactors at the same time they migrate their core business processes to S/4 HANA.  In order to minimize disruption for these customers while they implement S/4 HANA, SAP is enabling options for them to leverage SAP ERP HCM (running on-premise) and connected to S/4 HANA with productized integrations.  This enables S/4 HANA customers the ability to deploy SuccessFactors at their own pace, according to their own needs/strategies, and in a deployment manner that they have today.  These options include:

  1. Running SAP ERP HCM in a single instance co-deployed together with S/4 HANA on-premise edition
  2. Running SAP ERP HCM in a separate instance,  connected (via ALE) to S/4 HANA on-premise edition

Productized integrations for both scenarios are planned for 2H2015.  Under consideration is productized integration between SAP ERP HCM and S/4 HANA cloud edition.

In summary:

  1. New SAP customers should implement SuccessFactors as their HCM solution for S/4 HANA.  Productized integration is available to provide a seamless experience. SuccessFactors is SAP’s “go-forward” solution for HCM and most future innovations are planned there.
  2. S/4 HANA customers wanting next-generation HCM should implement SuccessFactors.  Productized integration is available to provide a seamless experience. SuccessFactors is SAP’s “go-forward” solution for HCM and most future innovations are planned there.
  3. S/4 HANA customers also using SAP ERP HCM and who are not able to make the move to SuccessFactors in the near term can continue to use SAP ERP HCM, running in either a separate instance or a single instance together with S/4 HANA.  Productized Integrations are planned for delivery in November to enable both scenarios. This helps minimize disruption to customers’ HR processes during the S/4 HANA migration and enables the ability to migrate their HR processes to SuccessFactors when they are ready.
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18 Comments

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  1. Joerg Edinger

    Hi David,

    thank you for this clarification.

    Good news for customers. They can now build their roadmap to move to the cloud at their own pace. Moreover S4/Hana with Simple Solutions could be implemented without a parallel HCM-project.

    Regards

    Joerg

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  2. Chris Paine

    Thanks David, I am glad that this has been clarified since we spoke at Mastering SAP HR in Melbourne.

    Perhaps some further clarification?

    • So the cloud based S/4HANA offerings, both single-tenant and multi-tenant are not included in the proposed support of HCM product?
    • Will LSO and even eRec (for those customers using it) be supported and will the integration into the simplified finance solution be built/tested for those uses?
    • I would assume (hope) that payroll posting will remain compatible with S/4HANA finance, yes?
    • Will any way to integrate all ERP HCM solutions be built into Fiori launchpad or will S/4HANA customers need to continue to use a portal of some kind?

    That’s probably enough for now. 😈 😆

    Cheers,

    Chris

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    1. David Ludlow Post author

      #1:  the cloud version of S/4 HANA is multi-tenant.  ERP HCM is not compatible with that so would need to be run on-premise; but productized integrations are not committed (the topic is being evaluated now)

      #2:  Yes, LSO and e-recruiting are part of ERP HCM.  Connecting to the S/4 cloud version would be part of the consideration in #1

      #3:  Yes.

      #4:  Unknown

      Some details are still being worked out.  Stay tuned. 

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      1. Chris Paine

        Thanks David ,

        perhaps we have a different definition of “cloud” – 3 versions of S/4HANA – one on prem, one hosted on HEC (single tenant “cloudish”), one public cloud (multi-tenant) – I’m lumping the 2 latter as “cloud” although would be happily swayed to only using that term for the public cloud version.

        I will indeed stay tuned, this is great for existing customers (and even some new ones where EC doesn’t yet have the capability (specifically thinking about Higher Duties and public sector solutions)).

        I look forward to seeing this story evolve!

        Cheers!

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  3. Geoffrey Corb

    Thanks David.

    So just to be clear… if you are an on-premise SAP ERP HCM customer today, you have do something within the next 10 years, as the current Business Suite (including SAP ERP HCM) will no longer be under mainstream maintenance at that point.  Correct?

    And if so, then your options are to (1) pay more to license and use SuccessFactors, or (2) pay more to license and use another HCM product? Common theme is that we all must go somewhere, and pay more for the opportunity to do so.

    Presumably, we will be saving something by that point since we won’t be paying our Business Suite maintenance bills and our S/4 HANA maintenance bill would have to be considerably less since the functional footprint is less a well. Right?

    I do not object to the philosophy here and a lot will happen in the next 10 years, for sure. No doubt that SuccessFactors will continue to evolve into a very robust platform and your ability to innovate more quickly in the cloud is very important. It is still unsettling for us existing on-premise SAP ERP HCM customers that we have a forced change coming and at additional cost.

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    1. David Ludlow Post author

      Hi,

      Business Suite 7.0 which includes the ERP solutions will be supported under mainstream maintenance through 2025. Any pricing and migration options should be discussed with your SAP Account Executive.  And I agree with you, 10 years is a very long time in “software years,” a lot can happen.

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    2. Chris Paine

      Hi Geoff, whilst David is restricted in what he can say – being an SAP employee 😉 as an external I might be able to be a little more flexible!

      I’ve seen situation where the subscription costs of SuccessFactors have been less than the equivalent annual ESS and MSS costs for SAP ERP HCM solution. There exists a scheme that will allow a company to migrate their existing HCM licencing payments over to SuccessFactors subscriptions. In that particular case, where a customer has agreed licences for the next 3 years, for example, this can be very advantageous over using an alternative solution.

      So I don’t think that customers will indeed need to “pay more to licence and use SuccessFactors”, (guess that depends on how awesome a bargain you have on your current SAP HCM licencing! 🙂 ) It may well be that moving to SuccessFactors might even work out cheaper! Although (nothing is free 🙁 ) there will be requirement for investment in the implementation of the solution, although even that is tending to be much less that the equivalent on Premise implementation.

      However, with the delivered integration that SAP is/will be offering it will be a much easier option to move to SuccessFactors than any other competing offering.

      In the meantime the option to run the on premise ERP HCM solution is not precluded from those that want to take up the benefits of S/4HANA but don’t want to move to a newer cloud based HCM offering.

      I’m pretty sure that as the years tick on towards that 10 year cut off, we’ll see some new and inventive ways to provide “private cloud” for some of the current SaaS only solutions meaning those that must use on premise solution will be able to as well – but I’m just guessing there, and very bluesky!

      I’m pretty sure that the HCM in S/4HANA means continuing to pay licence/maintenance costs for the ERP HCM solution (even if it is not evolving greatly), we’ll have to see if there are any changes there given the bigger focus on SuccessFactors for investment, I’m sure, as with all $$$ with SAP it will be down to your local SAP Account Executive to organise you the right prices. Good luck with that!

      All in all, my thoughts are that this latest clarification is good news. Certainly compared to where we were a week to two ago. I think we’ll keep asking questions so stay tuned for more news/clarifications.

      Cheers,

      Chris

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    1. David Ludlow Post author

      First option should be Employee Central Payroll to coincide with a move to Employee Central.  Potential alternatives are under discussion. 

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      1. Vladimir Semashko

        This is the point: Employee Central Payroll is classical SAP ERP payroll plus integration with Employee Central (according to my knowledge). And this is the reason I asked my question. Do you mean that SAP will implement about 50 existing standard SAP payroll country versions in Success Factors? Can cloud solution manage it? I mean not only implementation but also updates.

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  4. Victoria Albors

    Thanks David for the explanation.

    I do not know if this blog is closed or there are some ‘news’  to what you posted in June.

    If this is the case, could you please suggest any links  ?

    and I have another question,  if S/4 Hana is going/is  the  next generation, what would be the route map for  clients that currently rely on the HCM specific sector solution  on top of HCM  ( like in Spain we have the public sector solution Pse ) ?

    Thanks in advance for you answer,,

    Victoria Albors

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  5. Jay Crowley

    Hi David, like Victoria I’m also wondering if you could provide an update on the release of the productized integrations for both scenarios are planned for 2H2015?

    Thanks in advance,

    Jay Crowley

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  6. John Andrews

    Hello David:

    Two Questions:

    Can you provide an update to S/4HANA and HR in regards to the 2H2015 planned productized integrations? Or point me to information that will have this update.

    We are in the middle of an Acquisition and our Acquiring company is going to S/4HANA, we are currently in One Instance On-Premise. We would like to keep the One Instance approach.

    Can you share your views on staying in One Instance versus Multiple instances of SuccessFactors Employee Central and ERP On-Premise?

    John K. Andrews

    Sr. HRIT Lead/Integration

    Former SAP Americas HCM Consultant.

    johnk.andrews@c-a-m.com

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  7. Subbu Nutakki

    Hi,

    Do we have those packaged integration to feed SAP ERP HCM data to S/4HANA employee mini-master from SAP.

    and also if we have S/4HANA for finance and SAP HCM for Payroll do we need configuration sync between those two systems for us to ALE work?

    Thanks

    Subbu

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  8. Farooq MFarooqAli- Abacus

    Hi

     

    For new installation, can we perform the followin

    One S/4HANA 1610 system connected to NW7.5 (EP ESS/MSS WDA) ? If this is the correct, what we need to install on S/4HANA and NW7.5 ?

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