SuccessFactors: SAP strategy for HCM tools

Users of the on-premise SAP HR system can notice some dissonance – their fundamental work tool (SAP GIU) has several limitations which they do not come across in the majority of applications used daily (banking applications, Facebook, Twitter, Instagram, Flickr, Gmail). SAP assumed that systems available at any time and place using mobile devices are also necessary for business use. At SuccessFactors the model how the customer works with the application changes completely. SaaS (Software as a Service) by definition offers mobility, regular updates (in the case of SF – quarterly) and availability of infrastructure within the subscription fee.

SF is offered within an architecture in which each customer uses the same application instance, but has a unique configuration and data in their partition (multi-tenancy). It significantly facilitates system management – everyone works in the current version. Additionally, there is a possibility (upon the customer’s consent) to obtain numerous benchmarking reports through aggregation and data anonymization from various customers.

SuccessFactors will support the business execution philosophy understood as talent management, which ultimately results in obtaining particular business results. Authors of the solution introduced their own measurement of the return of execution – ROX. While ROI (return of investment) describes financial benefits, ROX also involves an increase of efficiency, strategy implementation and achievement of goals.

SNP as a partner of SuccessFactors

SNP offers a full range of services related to SuccessFactors, including implementation, development and maintenance of applications. SNP was one of the first SAP partners in Poland to have signed a partnership agreement with SuccessFactors. Under this agreement, SNP has expanded its SAP HR offering to include HR cloud services relating in particular to “soft” HR. SNP offers a full range of services needed for SAP HR implementation, development and maintenance.

Sample homepage of the BizX user

Employee Central (Central employee base)

We can say that Employee Central (EC) is a successor of the HR administration from the on-premise solution. Apart from editing basic data of employees, we can build the organizational structure. EC is a key component of BizX, if the customer decides to have Employee Central Payroll (a tool to settle payroll in the cloud provided by SAP). The module offers its users a wide range of self-service functions and extended Workflow.

Employee profile in EC

SAP Jam

SAP Jam is a social platform sourcing ideas from popular applications, such as Facebook, Twitter and YouTube. Employees exchange their knowledge (documents, photos, videos), start thematic groups, talk and help others in achieving goals established by the organization. The main benefit from the implementation of this tool is initiating and supporting informal training and strengthening proactive actions of employees.

Sample screen of the Jam service

Performance & Goals (Goal and performance management)

The component Performance & Goals (Goal and performance management) is probably the most frequently activated SF module and according to independent expert opinions (among others Gartner: Magic Quadrant for Employee Performance Management Software) it is the best solution in its class on the market. Managers can define goals (with support of an assistant for goals fulfilling SMART requirements, with a base of approximately 500 exemplary goals available), later assign in a cascade-like manner to their subordinates, conduct coaching, evaluate their subordinates and provide feedback. Therefore, the organization strategy is related to employees’ actions – they can be monitored on an ongoing basis, strengthened or corrected. Particular attention should be paid to:

• Integration with MS Outlook – sending reminders to people involved in reviews and evaluations;
• unique tool to evaluate employees in comparison to their team, minimizing the risk of unfair treatment;
• linking goals and their implementation with the remuneration system to promote the best employees;
• easy identification of the most efficient employees;
• automatic advisor supporting managers in coaching of their subordinates;
• ranking of employees, indicating candidates for leaders.

Employees’ ranking (Team Rater)

Compensation (Remuneration)

The solution SF Compensation allows remuneration, frequently being the largest cost of the organization, to be linked with the business results of the company. The application supports the entire remuneration planning process and all its participants, starting from planners and managers, finishing with employees who within self-service can review the results of their work. Remuneration changes can go through multi-level approval paths. In real time, it is possible to analyze the impact of remuneration changes on the budget.

Key application features:

• supporting planning of any payroll components (basic remuneration, bonuses, rewards, etc.);
• intuitive and customizable Workflow;
• linking goals and their implementation with remuneration;
• comparing remuneration and results of particular employees;
• modelling budgets, their distribution and implementation monitoring;
• possibility to model automatic remuneration changes (e.g. based on schedule of charges, evaluation results, plan implementation or other corporate guidelines);
• various programs for remuneration and awarding bonuses.

Recruiting Execution (Recruitment)

The application consists of two modules: recruiting management and recruiting marketing.

The SF solution is assumed to be easy to use and mobile. It was achieved among others by:

• simplifying candidate registration (one-page application);
• simplified management process of the feedback for candidates;
• integration with SAP Jam (talking about candidates in a group of recruiters);
• integration with social media, such as LinkedIn, Facebook and Twitter;
• shortening the expectation time for all actors involved in the recruitment process by making the process mobile (participation in the process using mobiles or tablets).

SF patented the recruiting marketing technology aimed at the optimization of the recruiting websites (increasing “visibility” of a given website online and its attractiveness for candidates). Recruitment specialists and managers have a set of reports on the interest in the announcements (the number of visitors on given websites, their profile) and on elements of the recruiting process, which may be enhanced.

Obviously, Recruiting can be integrated with EC (among others comparing the requirements of a given position with competencies of a candidate).

List of recruitment process statuses

Learning (training management)

Managers will appreciate the possibilities to analyze benefits of training activities for the company and their impact on strategic goals in SF Learning. The CaaS (Content as a Service) platform allows training content to be created, managed and shared. SF Learning supports the employees’ development strategy by:

• allowing access to training for authorized employees at any time and by using any tools (mobility – “learning-on-the-go”);
• providing tests and exams verifying the obtained knowledge and certificates;
• involvement of actors of training processes in the exchange of knowledge in social media (SAP Jam).

Succession & Development

S&D is an excellent tool to analyze our HR potential – we can quickly identify key people for the company, potential successors (and their readiness for changes) and are at risk of leaving work. The SF solution helps managers to foresee talent insufficiencies in the organization. In particular, the application supports users in defining succession and development plants for key positions:

• managers get to know competencies, possibilities, efficiency and preferences of their subordinates;
• SF allows identification of present and potential competence gaps, estimating the impact of the lack of talent on the business;
• managers can search the talent base in the organization and find the best successors;
• the application suggests development activities for people in whom competence gaps were identified;
• analysis of the domino effect allows to be prepared for the occurrence of the necessity to implement a succession plan for high positions.

The application can be used not only by managers – other employees also have access to so called career spreadsheets which allow them to follow positions preferred by them and competencies required to get a promotion.

Exemplary succession diagram

Workforce Planning

Organizations that have long-term plans wish to know what kind and how many employees they will need in the perspective of three or five years, if the current strategy will be implemented. HR needs may result from planned growth, acquisition or merger, decision to enter new markets and development of new products. Using the SF solution an organization can conduct complex analyses of consequences of future strategic decisions:

• estimate financial results of future employment changes,
• plan HR needs resulting from the assumed growth strategy,
• dynamically model organizational changes and their financial implications,
• manage risk – through identification of employment insufficiencies or gaps of competences necessary to implement the growth strategy,
• optimize results of changes through the analysis of various “what if” scenarios for changes in the workforce.

Screen of key metrics in the Workforce Planning module

Workforce Analytics

The analytics system provided by SF allows answers to key questions regarding HR to be found, starting from the easiest questions, such as „What is the current employment status?”, to more difficult ones, e.g.:

• What is the profit per employee? Is it increasing in value? How does it look like in comparison to the competition?
• Which organizational units achieve the best results (percentage of the value of implemented goals)? Why?
• What is the personnel rotation and how does it affect the implementation of strategic goals of the company?

The benefit of the application is the possibility to compare our data with available information on other companies – SF customers who share their knowledge willingly. Users can also access the report creator and a package of standard queries – hundreds of predefined comparisons and KPIs.

Functionality of so-called inquiries allows analysis of trends with the support of a guide facilitating understanding of data, identification of problems and seeking solutions.

Onboarding

Onboarding is the latest application in the BizX package. Newly employed get access to information on the team, key documentation, discussion groups and a training plan. They can ask questions to experts and employees who went through the same path in the company awaiting them (more on Onboarding available in the article entitled [TITLE] on page …..).

BizX Mobile

It is hard to imagine a modern HR tool without access to functions on mobile devices. BizX Mobile allows users to receive HR notifications, to manage tasks and meetings, participation in SAP Jam society and reviewing the organizational structure. The application is currently available on Android, Apple and BlackBerry platforms.

BizX Mobile

Payroll in the cloud

The complete solution for HR management in the cloud must include payroll settlement. Today, the SAP payroll solution in this model (Employee Central Payroll) is offered in several dozen countries. SAP announces that at the end of 2016 it will also be available for Polish customers. Therefore, the manufacturer will be able to offer a complete range of HCM applications in the subscription model. Employee Central Payroll is a solution based on a popular SAP Payroll module with a known settlement scheme, but with a new interface and several significant changes facilitating work of a payroll specialist. It is worth listing:

• simplified error identification;
• quick data correction when settling without the list status change “to be corrected”;
• division of the process of settlement per role and assigning tasks to relevant roles;
• improved interface (Payroll Process Manager).

Various models of SF activation

Customers who already have selected on-premise SAP HR modules can easily integrate them with SF BizX. The most popular model is a combination of “hard” HR (PA, OM, TM and PY) with SF Performance & Goals. SAP offers several integration options here. The hybrid model will certainly dominate for the several coming years among SAP customers.

Together with sharing several national versions of tools for payroll settlement, transferring all HR functions into the cloud becomes an increasingly common solution. In Poland, we will certainly know such customers at the end of this year.

There will be organizations – mainly large companies – with hybrid solutions or full cloud solutions in various locations. For instance, in their headquarters the company uses on-premise SAP HR and selected SF functions, while in their branches HR is fully implemented in the cloud.

What choices do current and future SAP customers face?

The year 2025 is still quite some time away; however, before making a decision about HR system development in a company, it is worth considering several guidelines:

• as long as there is no Employee Central Payroll version for Poland, the only reasonable solution is SAP Payroll on-premise;
• when Polish payroll in the cloud will be offered by SAP, one should seriously consider this solution (the subscription price will surely impact the decision);
• if we already have our payroll in SAP on-premise, we should look for talent management in the offer of SuccessFactors (unless the processes are so organization-specific that they are not possible to obtain through SF parametrization);
• if we wish to share self-service functions with employees, it is worth considering purchase of the Employee Central subscription, which may result in significant savings in comparison to SAP ESS/MSS;
• if you need complex working time management it is worth selecting a supplementary solution of one of SAP’s partners (also available in the offer of BCC), preferably on the HANA Cloud platform (favorable license conditions). Working time spreadsheets offered within Employee Central fulfill only rather simple requirements.

Should customers, selecting SuccessFactors, be guided by the 2025 deadline announced by SAP (the end of support for SAP HR on-premise)? Not necessarily. We can assume that SAP HR on-premise systems due to their common use will be supported much longer, if not by SAP itself, then by their partners. However, choosing SF solutions we are guaranteed modern applications, which develop and change with an increasing number of customers and their needs. Talent management in old SAP HR is not modernized; and according to current SAP pricelists, licenses may turn out to be more expensive than a SF subscription.