SAP SuccessFactors HXM Suite is evolving and innovating alongside newer HCM Digital Trends
The global Human Capital Software market had a year of strong growth in 2020, driven by the dual forces of cloud replacement and digital adoption. In 2020, HCM application leaders needed to swiftly turn around their plans due to COVID-19 impacts to focus on cost optimization and uptake of remote working. Digital Collaboration tools and AI/ML technologies are modernizing today’s workplace by increasing operational efficiencies across routine admin tasks.
Jumping in the bandwagon, SAP has also further strengthened and accelerated their HXM suite with the newest acquisition of SwoopTalent, incorporating a powerful trained artificial intelligence (AI) model that will allow customers to access reliable data to transform the employee experience and empower a future-ready workforce with their new reimagined workforce solutions.
Factors that are transforming the landscape of HCM are adoption of more meaningful digital experiences for employees, modernizing talent acquisition methods by adopting video technology, and using AI tools to analyze, identify and influence how leaders combine several productivity factors to increase team performance.
In 2019, the HCM application market (cloud and on-premises) grew 12% to reach $16.5 billion in total software revenue, outperforming the overall ERP software market, which grew by 9% in 2019 and the same is projected to reach nearly $26 Bn by 2026 with a CAGR of 6%.
Human Capital Management includes functions as: Recruiting & Onboarding, Performance Management (assessment, goal management, succession planning), Core HR (personnel administration, benefits, compensation management, payroll), Workforce Management (absence management, activity tracking, scheduling, time and attendance), and learning management system) and Employee Engagement.
Digital HCM trends are shaping the future of various HR functions in any organization:
- HRM Core functions: AI enables quick extraction of employee data and information when they start working new employer. RPA and AI are being used by companies for handling highly repetitive and data centric tasks. Vendors are adopting Artificial Intelligence and RPA solutions to manage employee database and to reduce operational costs.
- Workforce Management: Chatbot along with human interaction and mobile technologies are in trend for workforce management. Humans + Bots = Blended WFM. Newest skill in trend is knowing how to orient, develop, engage, and work side by side with a bot. Vendor example: Kronos: Employee scheduling, Time and attendance, Absent management.
- Compensation: AI technologies assist employees to understand the benefits they are entitled for and leverage it. AI tools help employees to sort through benefit options and pick the best one. It enables employees to get educated with the benefits and assist them to choose right options. AI and Online Reward Portal enable companies to personalize employee benefits.
- Recruitment and On-boarding: AI/ML assist companies to recruit and onboard the right candidates seamlessly, helps in screening and shortlisting right skills from job portals and analyze and scan right candidates from their video. Unilever is using AI software from HireVue, it scans the language that candidates use for example active or passive phrases, tone of voice and speed of delivery along with facial expressions.
- Performance and Talent: Predictive analytics aids companies to manage talent and AI allows employees to explore career growth options.
- Employee Engagement and Learning and Development: Employee Experience can be improved by providing Digital Tools to employees for managing their careers. And Gamification and VR are being used by companies for training their employees in more engaging manner
As per Gartner’s forecast, by 2023 nearly half of HR-related AI pilot projects conducted since 2019 will progress to full enterprise deployments. The twin forces of cloud replacement and increased digital support of HR processes are the growth drivers for 2021. By 2025, over half of global midmarket and large enterprises will have invested in a cloud-deployed HCM suite for administrative HR and talent management. However, they will still need to source up to 30% of their HCM requirements via other solutions. By 2024, SaaS is expected to account for 73% of the HCM software market.
Let’s have a look at how the year 2021 has been for SAP SuccessFactors (HXM) suite.
Leveraging the power of data and ML for learning, talent, recruiting and workforce analytics and planning has been a huge trend for a while now in the HXM space and almost all HCM vendors are trying to innovate more in this area.
SAP SuccessFactors HXM Suite is SAP’s cloud software to address the Workplaces challenges by managing, engaging, & empowering employees. SAP HXM focuses on EX to get better business results. It leverages ML based recommendations as well as embedding a chat function.
There are now more than 7,500+ organizations using SAP SuccessFactors software around the globe, including over 4,000 customers using SAP’s core HR solution, SAP SuccessFactors Employee Central.
- Despite the challenges of the global pandemic, more than 400 companies in the first half of 2020 had gone live with SAP SuccessFactors solutions.
- Adoption of SAP SuccessFactors continues to be robust and makes up a key growing unit within SAP. SAP remains the market share leader in HCM software, with 19% share in 2019 and revenue growth of 12.9%.
- In 2019, SAP SuccessFactors renamed its HCM suite “HXM” to reflect the focus on employee experience management tools by SAP Qualtrics, AI-based user experiences, and its formidable partner ecosystem. Integration points with Qualtrics surveys and experience management tools are starting to be applied throughout the HXM suite.
New enhancements in the HCM offerings by SAP:
- Brilliant Hire solution by SAP, released the early-access version of its smart job matching component to help companies optimize the entire candidate experience.
- Integrated with SAP SuccessFactors solutions, the technology in Brilliant Hire can filter any irrelevant job postings and show candidates only those opportunities that truly match their skills and interests.
- Accelerating Transformation with RISE with SAP for Human Experience Management
- RISE with SAP for Human Experience Management is a new offering to help organizations accelerate their people transformation while providing a solid foundation for ongoing digital transformation.
- By combining the RISE with SAP offering with HXM solutions, such as SAP SuccessFactors Employee Central, SAP Work Zone for HR, and SAP SuccessFactors Learning, organizations have the choice and flexibility to modernize their people strategy.
- Experience Management solutions from SAP and Qualtrics continue to be integrated across SAP SuccessFactors HXM Suite to collect feedback at various touch points, helping organizations understand and improve the employee experience.
- The SAP SuccessFactors Employee Central Payroll solution has been updated with the payroll control center to make it easier to create and maintain payroll processes, alerts and analytics.
Partnership with HR Start-ups:
On their start-up accelerator front also, SAP.iO Foundry San Francisco have launched couple of programs focused on HR technology and FutureofWork-related innovations. SAP will accelerate six early-stage startups focused on recruiting, talent and team management, diversity, equity and inclusion, and collaborative learning. The future of work cohort includes Emplay, Gapsquare, Humanly, Immerse, Mentor Spaces, and The Mom Project.
SAP HXM in various geographies:
In Latin America, SAP announced financial results for Q1 2021 in Argentina and Latin America reporting double-digit growth in the cloud for 23 consecutive quarters with Colombia being a major contributor to this growth. And SAP’s Focus Area in Latin America: Talent management and Purchasing processes were the technological investment priorities of Mexican companies during 2020. Key sectors such as banking, health, consumer and manufacturing advanced significantly in their technological adoption by SAP.
In Mexico, retail sector took the lead in adopting SAP cloud technology in the Q4, 2020. Talent experience management portfolio that includes SAP SuccessFactors tools showed a double-digit increase, e.g. Rappi, the Latin American unicorn implemented SAP SuccessFactors in the cloud in 8 countries in just 5 months.
SAP opened a new R&D facility and corporate office in Montreal, Canada. This also included the creation of a new engineering unit, to work on SAP’s Consumer Industry Cloud, which builds custom technology solutions for more than two dozen industries globally. This investment will immediately create 30 net new positions, bringing the total headcount for SAP Montreal to 1,000 employees. More growth is expected throughout 2021.
With changing remote workplace dynamics in Canada, growing and accelerating demands is seen for investment in remote collaboration tools and integrated HR technologies like SAP SuccessFactors.
The SAP SuccessFactors (Human Experience Management) Suite offers all of the talent management modules and has made many updates to learning management and continues to deploy enterprise collaboration throughout its talent solution to up social utility. SAP has increased its focus on AI-based experiences, embedded employee experience management tools across the suite, and extensibility with its robust partner ecosystem.
MARELLI (an independent supplier in the automotive sector) wanted to develop a cohesive global system to bring together 60,000 employees across 170 facilities and research and development centers in 24 countries.
In just six months, MARELLI implemented SAP SuccessFactors Employee Central, SAP SuccessFactors Performance & Goals, SAP SuccessFactors Learning, and SAP SuccessFactors managed payroll. The implementation was completed remotely during the global pandemic with no face-to-face interactions. Despite these challenges, the first performance campaign achieved 97% adoption within five weeks.
The SAP HXM suite has been recognized as leader in various analyst reports (like Gartner, ISG and IDC) for HCM capabilities and their Cloud HCM SaaS solutions.
At SAPPHIRENOW 2021, SAP re-emphasized that they are going to help organizations drive the cultural change needed for ongoing digital transformation. SAP has combined RISEwithSAP and HXM solutions to provide the choice and flexibility organizations need to move their human resources (HR) operations to the cloud.