One part of my role as the HR/Payroll SIG Lead for the SAP User Group within Australia is to catch up with fellow customers to consider and discuss issues which affect the SAP HR landscape within our community. One constant conversation over the past 18 months has been the impact of cloud solutions and in particular SAP’s acquisition of SuccessFactors.
In this blog, I will summarise some of the HR business and IT considerations that I have discussed with my fellow SAUG customers when they are thinking of moving to, integrating with or starting with a SuccessFactors cloud solution.
These considerations have been summarised in no particular order of importance and have been provided as trigger point for other customers to consider/ evaluate the impact for their situation;
1. Processing & Integration Model for the Cloud
Understand what the new cloud process options are
Understand what people data is being processed where
What is the Authoritative Data Source for your process? On-premise or cloud?
Resources / Effort to set-up integration/extracts based on your requirements
Which integration model will you use? (Flat file / PI / Cloud)
How much custom DEVELOPMENT can/should you do in the ‘cloud’?
2. Financial Model variations
Decision to invest in cloud versus how much capital you have already invested in on-premise
OPEX v CAPEX decision, does your investment plan need to change?
HR Business might need to plan for OPEX cost, does this require budget uplift? Quick decisions may not be possible as result, might need to plan then wait for a new financial year.
3. Business / User readiness
Are the business users ready for ‘gamification’, mobility, etc? Should you phase the roll out for ‘wiz bang’ options?
Are there too many solution / process options?
Is there a priority to keep it simple, and increase best practice/complexity over time?
4. Procurement involvement
Many HR groups can/may contract directly with SaaS vendors, however involving the procurement group is more likely to lead to a reduced price for subscription
This is not on-premise software, so new contractual elements around privacy and data ownership are more important
Procurement may want business to go to RFP, marketplace for evaluation than just selecting SAP/SuccessFactors
Procurement might need to provide guidelines to help HR/IT in dealing with SaaS solutions if ‘cloud’ is new for your organisation
5. Licensing / Subscription – User based
Buying per user for SuccessFactors Talent processes
The number of user’s identities the employees who are available for processing in cloud solution, some of your employees might only be in SAP ‘on-premise’, not in cloud.
Tracking/processing of ‘active’ solution users, movement up and down in user numbers may impact your subscriptions numbers
Generally ‘subscription’ starts at contract signing not deployment of solution, paying from day one, not when ‘go live’
Renewal licensing? Do you negotiate this up front?
6. Security – IT Concerns
Security of employee data
What is your company or country policy?
Can business make decisions without IT involvement?
Who needs to be involved in decision making?
The above is a sample of considerations others also exist around vendor management pre and post implementation and where does on-going ownership of the solution sit within the business or IT?
Two further considerations/lessons were highlighted by those who have implemented SuccessFactors in the last 2 months;
Ensure that HR and IT are involved in the selection, evaluation and implementation this way key parties are making decisions jointly, sharing in the success and the pain;
If you are moving to the cloud, ensure that you involve your procurement group early in the negotiation process to ensure best bang for your buck!
From a personal viewpoint I for one welcome and embrace this shake up of in the HR area. We the customers are the ones who are ultimately the beneficiaries of the SuccessFactors acquisition, as well as the increase in other ‘cloud’ solutions, as we now have greater choice, higher grade solutions and more competitive options. It is and will prove to be the disruption required for us all to ask questions of where the HCM space is going next, and that’s a great thing.