Purpose of this blog
All the time, we are hearing about the mass “digitalization of HR” and about the latest “HR disruptors” that the high-tech industry is producing at a rapid pace. In a separate blog, I decipher what “Digital HR” really means and introduce SAP Cloud Platform as a crucial piece of the holistic solution for your company to achieve it. In this blog, I take that discussion one level deeper. My purpose in writing this blog is to show the desirability, viability, and feasibility of using SAP Cloud Platform to extend your SAP SuccessFactors system in order to face “HR disruptors” and achieve a truly “Digital HR” department.
Desirability : the quality of being desirable
Extending any core HR system (for example, SAP SuccessFactors) is desirable for HR departments who want to address the “HR disruptors” that they are facing.
When we talk about “HR disruptors”, we are talking about the new expectations from the workforce that spawn because of new technologies. For example, since 2012 a lead disruptor that HR has been facing is the need to mobilize employees’ HR tools 1, 2, 3. Not surprisingly, this need directly correlates with the rising adoption of smartphones and other mobile devices. In fact, Pew Research Center reports that smartphone ownership in the United States doubled from 35% to 77% between 2011 and 2016 4. What does this have to do with HR? Well, during this same time period there was a spike in the percentage of the workforce who fall into the “millennial generation”, e.g. those born between 1981 and 1996 5. In fact, in 2016 the number of workers from the millennial generation surpassed the number of workers from previous generations to become the largest generation in the workforce in the United States 6. Of their many defining characteristics, members of the millennial generation, or “millennials”, are mobile-first. Millennials grew up during the rise of smartphones, so it comes as no surprise that 94% of millennials report owning a smartphone 4. Since 2012, the rapid adoption of mobile technology propelled by the millennial generation has placed the expectation on HR to provide the rising majority of millennials in the workforce with HR tools that reflect the user experience of the tools on their smartphones that they use in their daily lives.
Every year, leading analysts of the HR market take existing and new “HR disruptors”, analyze them against poll and survey data from HR departments at companies around the globe, and predict which disruptors will be the most common demands that HR will face for that year. They roll these disruptors out at conferences and in blogs/whitepapers as HR trends.
Here are what leading analysts highlighted as the top HR trends for 2017 and 2018 :
| HR trends for 2017 | HR trends for 2018 |
| Real-time Engagement Evaluation | understand employees’ needs through always-on, pulse-based feedback systems 8, 9 | HR chatbots | create HR chatbots to handle many basic HR administrative functions and free up HR employees' time for other tasks 10, 11, 12, 14, 15, 16 |
| Rise of People Analytics | migrate HR data warehouses to advanced, actionable people analytics 8, 9 | Employee experience | create an engaging enjoyable experience starting at the interview stage through the time that an employee exits the company 10, 12, 15 |
| Maturation of the Learning Market | allow employees to not only register for courses but also browse, curate, and recommend courses 8 | AI in HR | create AI capabilities that focus on driving business value out of their HR investments 14, 15 |
| New Landscape for Talent Acquisition | enable HR to quickly source and hire the right talent 8 | Continuous Performance Management | understand employees through effectively measuring their performance on an ongoing basis with in-the-moment feedback 11, 15 |
| Growth of Contingent Workforce Management | adapt recruiting, scheduling, and performance management processes to accommodate the rising number of contingent workers 8, 9 | The ‘Gig Economy’ Redefining the Workplace | realign company culture and management practice to account for the massive rise in virtual work and contract employment 10, 11 |
| Accelerate Automated HR | use artificial intelligence, natural language processing and robotic process automation to turn transactions between employees and HR professionals into automated interactions 8, 9 | Marrying HR data with non-HR data | incorporate real-time financial data to provide better metrics for HR decisions such as the ROI of compensation adjustments such as merit increases and bonuses 11, 12 |
I show these trends because they highlight some of the challenges that HR faces at different points in time. Each of the trends above originate from the core responsibilities of the HR department. These core responsibilities remain relatively stable over time and revolve around attracting, hiring, managing, developing and retaining people. What brings these to the forefront of the conversation at these points in time, and ultimately makes them trends, are two factors: the demands of employees and the available technology. These factors are not stable; they evolve over time and require HR departments to be agile in order to proactively respond to them. This agility is what HR departments can achieve with extensibility.
What is extensibility? We discuss the concept of “extensibility” ad nauseam in our whitepaper, “Tap the Benefits of Extensibility with SAP Cloud Platform”, but in that whitepaper we define the term at length and in a generic way to encompass many lines of business systems; not just an HR system. So, for the purposes of this blog, extensibility is defined as the ability to add new capabilities to a core HR system in a way that these capabilities can be easily turned off/on and newer capabilities can be added. In other words, extensibility gives HR departments the agility to meet the challenges that they are facing at the time that they are facing them.
This agility is crucial as companies have unique requirements, unique employees, and a unique culture that HR needs to safeguard and to nurture. Extensibility is a solution for periodic threats like increased competition for qualified candidates due to an improving economy or vulnerability to the mass retirement of the Baby Boomer generation. Extensibility is a solution for situational threats like the merging of two companies with separate HR processes built into separate HR systems that were both highly customized. Extensibility is a solution to innovate and differentiate HR programs like a rewards and recognition program based on achievements personalized for what employees actually do at work with an awesome mascot created specifically for that program. I discuss how extensibility provides these solutions later in this blog.
In short, HR departments have two tools in their toolbox : a core HR system and the extensibility of that core HR system. The core HR system provides the stable environment for executing core HR responsibilities. Extensibility provides the agility to address disruptions from employee demands and new technology without disrupting that core. This is why extending any core HR system is desirable for HR departments.
To take advantage of extensibility when SAP SuccessFactors is your core HR system, SAP has built and productized both SAP SuccessFactors Extension Center and SAP Cloud Platform. In a separate whitepaper, we discuss the differences between SAP SuccessFactors Extension Center and SAP Cloud Platform. To paraphrase that whitepaper, SAP SuccessFactors Extension Center provides in-app extensibility via addition of new data fields and HR workflows; SAP Cloud Platform adds another layer of extensibility to provide you the computing resources and platform services to build new applications that are able to incorporate entities from SAP SuccessFactors Extension Center as well as other non-HR systems. In the next section, I will focus on extensibility specifically using the SAP Cloud Platform and show how it can be leveraged. I choose this focus because that is the purpose of this blog. But I want to be clear that when you choose to extend SAP SuccessFactors, it is not a choice between SAP SuccessFactors Extension Center and SAP Cloud Platform. Often both products are used which is why SAP SuccessFactors Extension Center comes included in your purchase of SAP SuccessFactors.
Viability : the ability to work successfully.
I hope that by now I have peaked your interest in extensibility and have somewhat convinced you to desire utilizing extensibility as a means to address disruptions that your HR department is facing and to get innovative with the way that your company does HR. In this section, I will prove that extensibility can be done successfully with SAP Cloud Platform. To make my case, I will discuss a few use cases for extending SAP SuccessFactors with SAP Cloud Platform that have actually been achieved.
An interesting exercise that I like to do is to compare forecasted HR trends with the capabilities that HR systems plan to provide. We will use the HR trends for 2018 listed in the section above “Desirability : the quality of being desirable” and compare them against the product roadmap for a leading HR system. We will use the SAP SuccessFactors Solutions Road Map for 2018 as our example system/roadmap and to ensure that we are comparing trends vs. capabilities of the same year.
One trend predicted for 2018 is the redesign and improvement of continuous performance management, or “CPM”, tools. The motivation for this trend is that companies want to better understand their employees through effectively measuring their performance on an ongoing basis using in-the-moment feedback. In 2018, SAP SuccessFactors plans to provide the following capabilities to improve its continuous performance management solution, see Listing 1. below.
Listing 1. Features planned in 2018 for SAP SuccessFactors Continuous Performance Management solution
- Ad hoc feedback
- GDPR compliance
- SAP Analytics Cloud for reporting
- View and manage feedback requests
- Support for multiple goal plans
- Mobile support
- General enhancements and user interface improvements
These capabilities will provide a solid base for a CPM solution and would meet all the general needs of such a solution including in-the-moment feedback, analytics to surface that better understanding of the employee, and accessibility across devices to accommodate various employee lifestyles. But will they meet all your company’s specific needs? And will they be available at the time when your company needs them?
SAP faced these very questions in 2015 when our own HR department began discussing how to integrate a continuous performance mindset into our company’s culture and how to provide continuous performance management capabilities via our HR tools. I discuss this in Case Study 1. below.
Case Study 1. SAP addresses its continuous performance management needs with extensibility
To provide some background, SAP uses SAP SuccessFactors as its HR system, and at the time we knew that SAP SuccessFactors had plans to release a CPM solution as a part of its Q1 2016 release. However, we had some specific needs that we wanted to address in our implementation.
For example, SAP has an HR program to identify and reward high-performing talent in the company. Determinations of which employees are elected into this program are made in the middle of the year after employees’ initial goals and development plans have been defined. Employees who are a part of this program are identified in SAP SuccessFactors through a flag in their People Profile. SAP wanted a CPM solution that would be aware of this program so that managers could adjust accordingly the continuous dialogue that they were to have with their employees once the solution was enabled. This specific integration was not yet going to be available in the CPM solution provided by SAP SuccessFactors.
For a second example, SAP is a global company and therefore must globalize its internal tools for the various countries in which it is located. In Germany, SAP has a workers’ council where elected employees represent the interests of the German employee population in the workplace. Part of the workers’ council’s duties include having a say in how employees’ performance is being monitored and ensuring data privacy. As such, our CPM solution needed to be able to bundle all data entered into the solution as a result of their performance conversations and securely provide it to the workers’ council should they ever need it. This capability is niche and uncommon and was also not yet going to be available in the CPM solution provided by SAP SuccessFactors.
SAP was in a pickle. Our HR department was on a tight timeline to make available a new CPM tool; we had existing programs in place that we wanted to integrate; and there wasn’t yet a vendor with a solution that satisfied these additional capabilities on top of what SAP SuccessFactors already provided. So what could we do?
What we did was put together a project team to build a tool with these additional capabilities and leverage the extensibility of SAP SuccessFactors. And in 2016, we internally released the “SAP Talk” tool built on SAP Cloud Platform that integrated with various modules across the SAP SuccesFactors product suite including People Profile, Goal Management, Development Management, and the newly released Continuous Performance Management via the wide variety of available APIs. If you are interested in the architecture of our “SAP Talk” tool, I have provided a solution diagram in Figure 1. below and we provide more details for the composition of this tool in the SAP Cloud Platform Blueprint for Continuous Performance Management Process.
Figure 1. Solution Diagram for “SAP Talk”
SAP is not the only company with a use case that requires extending the existing SAP SuccessFactors continuous performance management solution. Our partner ecosystem has realized this and many SAP partners have built extension applications on SAP Cloud Platform that satisfy a range of niche industry-specific/location-specific/culture-specific needs and made them available for purchase on SAP App Center. For example, Sodales Solutions has productized its “Continuous Performance Management with Feedbacks” extension application which is capable of integrating with Microsoft Outlook, connecting to data stored in on-premise HR systems, as well as handling seasonal or “gig” employees just to name a few. Had these products only been available back in 2015, it might have saved us the development effort of building something ourselves.
Other successful realizations of extensibility go beyond the use case of improving your company’s CPM solution. I won’t go into those details in this blog, but we have a page where you can see what other SAP customers have done to extend SAP SuccessFactors and realize their own use cases.
The scenario described in Case Study 1. above is a perfect example of both the desirability and viability of extending SAP SuccessFactors with SAP Cloud Platform. SAP SuccessFactors is a core HR system. It is a strategic offering of modules and capabilities that represent the standardized best practices for satisfying most HR needs. These modules and capabilities expand and improve alongside forecasted HR trends to incorporate the trends that align with what SAP SuccessFactors analyzes and deems as best practices. If we visualize the holistic needs of your HR department as a pie, then SAP SuccessFactors accounts for nine out of ten slices of that pie. But there is this undeniable remaining slice representing your company’s specific needs, differentiating HR services, and agile HR innovations which offer a blank canvas to be filled with extended capabilities built on SAP Cloud Platform. Josh Bersin – a leading analyst for the HR Tech market – acknowledges this and advises companies to seek out tools that are “extensible in their design” because “no vendor will give you everything you need”. SAP SuccessFactors combined with SAP Cloud Platform is the perfect pairing to satisfy this reality.
So, to return to the topic of this section, viability is the ability to work successfully. And as we have just read above, SAP Cloud Platform makes it viable to tap into the extensibility of SAP SuccessFactors. Not only has SAP done it successfully, our partners have done it successfully, and our customers have done it successfully.
Feasibility : the state or degree of being easily or conveniently done.
In the prior two sections, we covered why you would want to extend and we proved that extension with SAP Cloud Platform can be done (and has been done) successfully. In this section, let’s look at feasibility. In other words, we know that extension can be done but how can your organization do it?
In the context of the extensibility of SAP SuccessFactors, extensibility manifests itself as an extension application. And in the context of SAP Cloud Platform, extension applications are applications that run in SAP Cloud Platform datacenters, that are built with SAP Cloud Platform services, and that take advantage of the extensibility of SAP SuccessFactors. I want to clearly identify the type of extension application that I am referring to because, as I mentioned in the section “Desirability : the quality of being desirable”, SAP SuccessFactors provides in-app extensibility which, like SAP Cloud Platform, also enables your company to have extension applications. From this point forward, when I refer to extension applications I am referring to the extension applications on SAP Cloud Platform that I describe above.
Your HR department has two options to get extension applications through SAP Cloud Platform. Depending on the option that you choose, the feasibility, or degree of ease and convenience, of implementing that extension application shifts. The two options are to build or to buy an extension application.
The first option for your company to get an extension application is to build it using the talent and resources that exist within your company. That may sound daunting at first, but SAP Cloud Platform has a number of tools and services to make the job easier - from a central cockpit for managing integration and security across your applications to a UI framework embedded in a web-based development environment to pluggable business services like document storage, analytics, Internet of Things, and machine learning so you don’t have to build these capabilities yourself. While SAP Cloud Platform offers a number of services so that you don’t have to start from scratch when building an extension application, it is still a project and therefore will require your company to dedicate the right talent to the project. The teams that we have seen work in other customer projects include a project lead from the HR department with deep knowledge of the use case and the pain points to be solved, a project lead with a technical background who will lead the development of the extension application, and at least two developers to build the frontend and user interaction of the extension application and to build the backend of the extension application as well as model the underlying data structures. We discuss assembling the right team for an extension application project in Unit 6 of Week 1 of the openSAP course: Extending SAP SuccessFactors with SAP Cloud Platform (an account with openSAP is required to access that link). And for those of you wishing to learn more about building extension applications on SAP Cloud Platform, check out the linked blog by Manju Venkatesh who describes the specifics of what SAP Cloud Platform provides.
Even if that last paragraph scared you, keep reading! Because at this point some of you may be thinking that this sounds like too big of an investment or that your HR department doesn’t have or can’t allocate the necessary talent for this extension application project. Well put those concerns aside, because we are in luck! There is a second option to get an extension application.
The second option for your company to get an extension application is to buy it from the SAP App Center. SAP has cultivated a growing ecosystem of certified SAP partners many of whom have built and productized extension applications for SAP SuccessFactors based on the latest and hottest use cases (refer to the top HR trends in the “Desirability : the quality of being desirable” section above). And these pre-built, pre-packaged extension applications for HR are available on SAP App Center for purchase.
If you are debating between the options of building or buying an extension application, there are several helpful resources available. If you are looking to buy, Manju Venkatesh highlights the advantages of extension applications built by partners in the linked blog. If you are looking to build, Manju also addresses the requirements of an extension project team in a separate blog. If you aren't sure which option to take, keep reading. In the next section, I introduce the SAP Cloud Platform Discovery Center to help you discover a use case for extensibility and match you with the right solution.
To conclude this section, we looked at the feasibility of using SAP Cloud Platform to extend your SAP SuccessFactors system. We now understand that feasibility is a scale. The easiest and most convenient way to get an extension application is to purchase one from SAP’s partner ecosystem. Second to that is to build the extension application yourself. To increase the feasibility of building an extension application, SAP Cloud Platform provides a number of tools and services. However, the option is always there to build an extension application from complete scratch. While this may not be the easiest and most convenient approach, as we saw in the section “Viability : ability to work successfully” it can be done. Ultimately, the degree of feasibility for your company to approach extensibility is truly your choice.
Introducing the "SAP Cloud Platform Discovery Center" for the HR professional
So we’ve covered why you would want to extend, and we have proved that extension can be done with SAP Cloud Platform, and we have even looked at the options that you have to take full advantage of the extensibility of SAP SuccessFactors using SAP Cloud Platform, but you still may have questions. For instance, you may be thinking that this all sounds great, but you still don’t really see a use case for your company to extend your SAP SuccessFactors system with SAP Cloud Platform. For those of you with these doubts, I’d like to introduce you to the SAP Cloud Platform Discovery Center.
The SAP Cloud Platform Discovery Center is a free service provided by SAP that helps you discover use cases, matches you with a solution, and provides you with a complete project to guide you and the colleagues that you select for your project team through the implementation to go-live. At every point, you have direct contact with the necessary expertise so that your project team has all the resources necessary to conclude your project with a productive solution that achieves your use case.
There are multiple entry points into the SAP Cloud Platform Discovery Center for the HR professional depending on what you are looking for, see Listing 2. below.
Listing 2. Entry points to the SAP Cloud Platform Discovery Center for the HR professional
- We have an entry point for the HR professional who wants to use “PlatformX” to discover and implement a pre-packaged extension application built by a certified ...
- We have an entry point for the HR professional who wants to use “PlatformX” to learn about the business value of SAP Cloud Platform to an HR department
- We have an entry point for the HR professional who wants to use “PlatformX” to learn how to develop an extension application for SAP SuccessFactors
- We have an entry point for the HR professional who wants to use “PlatformX” to learn more about the role of an SAP SuccessFactors administrator with regards to ...
Each entry point will lead you to what we call “Missions”. The value of the SAP Cloud Platform Discovery Center is built into these Missions. By starting a Mission, you create an instance of a project board that can only be accessed by you, your colleagues, and the experts for that Mission. This means that the timeline and milestones for this project can be tailored to the specific needs of your project team and your company. So if your company requires a lengthy legal review before embarking in any project, no problem! Or if you have specific implementation needs, no worries!
The SAP Cloud Platform Discovery Center is entirely free, so if any of those entry points appeal to you feel free to click into one without fear and start a Mission yourself!
Conclusion
My purpose for writing this blog was to show the desirability, viability, and feasibility of using SAP Cloud Platform to extend your SAP SuccessFactors system. In our discussion of desirability, we looked at how extensibility gives your HR department the opportunity to approach the shifting trends of HR and to ultimately achieve your goals. In our discussion of viability, we looked at how extensibility has been done successfully by SAP, our partners, and our customers. In our discussion of feasibility, we looked at how easy and convenient it can be to extend an SAP SuccessFactors system with SAP Cloud Platform. We saw how SAP Cloud Platform offers two options for getting an extension application which puts the feasibility of extensibility on a spectrum. There is the option for your company to custom develop an extension application in-house. Or there is the option to go with a pre-packaged extension application built by SAP’s partner ecosystem. And lastly, I introduced you to “PlatformX” by SAP where HR professionals can discover a use case for extending their SAP SuccessFactors system and start a project to turn that use case into reality.
If there is a single action item that I would leave you with in concluding this blog, it would be to click one of the entry point links for “PlatformX” and spend just 10 minutes surfing around. For you overachievers reading this blog, I further challenge you to actually start a Mission. Because, despite all of the talking and presenting and blogging I do on extending SAP SuccessFactors with SAP Cloud Platform, the best way for you to estimate its value is to see for yourself what is possible with extensibility.
Thank you for reading this, and please comment below if you have any questions, points of clarification, or if your HR department is facing any new challenges and you are wondering if extensibility might provide a solution.
About the author
Colin Kraczkowsky is on the Product Management team for SAP Cloud Platform. His domain expertise includes SAP SuccessFactors extension development on the platform.
Colin’s professional history includes enablement and extension development for SAP’s analytic portfolio and front-end design and business development for a digital media startup in Washington, D.C.
In his spare time, Colin likes to explore new areas, watch scary movies, try weird foods and participate in Turkey Trots. Colin is currently located in Palo Alto, California.
Connect with Colin – https://www.linkedin.com/in/colinkraczkowsky
Sources
- 2012 HR Technology Forecast | Michelle Rafter | January 11, 2012
- Mobile first — there’s an App — for HR? | Christa Degnan Manning | May 3, 2012
- HR TechnologyConference 2012: Mobile, LMS, and Cloud | Josh Bersin | October 10, 2012
- Mobile Fact Sheet | Pew Research Center | February 5, 2018
- Millennials | Pew Research Center
- Millennials are the largest generation in the U.S. labor force | Richard Fry | April 11, 2018
- People Analytics Market Growth: Ten Things You Need to Know | Josh Bersin | July 1, 2016
- 9 HR Tech Trends for 2017 | Josh Bersin | January 25, 2017
- Reviewing 2017 Human Capital Management Technology Forecasts: New wine in old bottles & old wine in ... | Steven Hunt | April 20, 2017
- Four Key HR Trends To Watch In 2018 | Chee Tung Leong | December 12, 2017
- Future Of Work 2018: 10 Predictions You Can't Ignore | Steven Hunt | December 18, 2017
- The four hottest HR technology trends for 2018 | Albert McKeon | January 11, 2018
- Gartner Top 3 HR Insights for 2018 | Sharon George | January 23, 2018
- Top 6 HR Technology Trends for 2018 | Aliah D. Wright | January 26, 2018
- Look ahead at HR trends for 2018 | Archana Jerath | January 30, 2018
- 2018 Deloitte Global Human Capital Trends | Deloitte | March 28, 2018
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