SAP and SuccessFactors – An Overview

  • by Luke Marson, Co-Founder, CEO Americas, and Principal Architect for Employee Central, iXerv
  • February 15, 2013
In this exclusive in-depth report, learn about SuccessFactors and what the acquisition means for SAP ERP HCM and your business. Get a detailed,comprehensive overview of SuccessFactors, SAP’s strategy, the future of SAP ERP HCM, and how the recent acquisition of SuccessFactors will affect your business. It aims to dispel any myths or confusion around SuccessFactors and provide a solid grounding on SuccessFactors and its position in the SAP ERP HCM family.
Key Concept

Software-as-a-Service (SaaS), also known as On-Demand, is the next generation of enterprise software offered as services in the cloud. SaaS provides access to enterprise software on a subscription basis without the need to own or maintain hardware or software. The software, and your data, is hosted remotely and accessed on demand from any location using the unique login credentials of your organization. SaaS software is multi-tenant, which means that many instances of the software are accessed and are on the same application version. Users can choose which features and functionality to use in the standard solution and in the regular releases that are introduced by the vendor. Cloud, in this context, refers to any software or service that is hosted remotely and accessed over the Internet.

On February 23, 2012, SAP acquired the Software-as-a-Service (SaaS) HCM and Talent Management software vendor SuccessFactors for $3.4 billion. This acquisition turned SAP into a vendor of both on-premise and SaaS HCM software and a major player in the competitive SaaS HCM market. It also brought the experience and expertise of SuccessFactors founder Lars Dalgaard onto the SAP Executive Board, to bring what was termed “Cloud DNA” into the organization.

SaaS is considered to be the next-generation platform for providing enterprise software. While many people feel uncomfortable with the concept of cloud computing, they may not understand that they are already using cloud-based software for everyday activities, such as email (e.g., Hotmail and Gmail) or document storage (e.g., Google Drive and Dropbox). Almost any piece of software offering a service over the Internet is SaaS and these offerings are now touching our daily lives.

The next step for SaaS is enterprise software. Originally many of the SaaS vendors started with talent management systems, following the growing trend seen in the 1990s and 2000s. As many of the vendors grew, they began to expand their portfolios and offer other HCM services. Now, SaaS vendors are also pioneers of social collaboration software for businesses and mobile solutions. SuccessFactors is considered a leader in SaaS talent management and social collaboration software and was recently named as a leader in Talent Management by IDC. In Gartner’s 2011 Employee Performance Management Magic Quadrant, which covers performance management, succession planning, and compensation management capabilities, SuccessFactors came out head and shoulders above all other vendors; unsurprisingly, many of the closest challengers were SaaS vendors.

Luke Marson

Luke Marson is co-founder, CEO Americas, and Principal Architect for Employee Central at iXerv, a global SAP SuccessFactors consulting partner. In addition to his duties as CEO, he is an active architect and subject-matter expert on SAP SuccessFactors. Luke is a Certified Professional in SuccessFactors Employee Central who has worked with over 15 customers, and is the co-author of the following books: SuccessFactors with SAP ERP HCM and SAP SuccessFactors Employee Central. He is also an author, blogger, speaker, strategist, and widely recognized expert in SAP SuccessFactors and SAP ERP HCM. Luke can be found on Twitter at @lukemarson.

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