On the tail end of the HR Tech conference, SAP smartly organized the SuccessFactors user conference - also in Las Vegas, just up the strip at the Venetian. And it was a good and well attended event.
Similar to other SaaS vendor user conferences there was an inert positive dynamic to a user conference that grows by 15-30% every year, with more attendees, exhibitors, partners, product functionality etc.
This was the 2nd SuccessFactors user conference since the December 2011 acquisition by SAP, and the first one since the departure of founder and former CEO Lars Dalgaard. So not surprisingly it was key for SAP to make sure that consistency is ensured, investment continues, all the products are well and that the SAP muscle behind SuccessFactors makes the company even better than before.
Combine that with the need to not only show the investment commitment but also the necessity to remain a nimble and agile SaaS player that cares for its customers, and you had the agenda behind the keynote presentation of SuccessFactors president Shawn Price. And Price delivered exactly along these objectives in a well received keynote. Chatting randomly with attendees afterwards the messages were well received and dispelled the usual concerns that are seen around acquisitions of that size in the industry.
The key announcements were the new capability of a payroll workbench and an integrated help desk functionality, that re-uses the CRM Help desk offering. And while that is a great re-use of functionality in a suite - it will merit some close attention to the needed extensions for an internal employee helpdesk. Both new capabilities will be available in 2014.
On the hard factors side it was impressive to learn that SuccessFactors now has 23 millions users, 3700 customers, is running in 177 countries and supports 35 languages.
The second day featured Dmitri Krakovsky's product keynote - and it was equally well delivered and received. It was encouraging to see a head of product performing all the demos by himself and knowing the product pretty much inside and out, demoing it with ease. It became also clear that SuccessFactors is working hard to get information out of the system presented in an appealing and easy to consume way - as the headline product demonstrates. And the company is certainly up to something - as the feature turned out to be popular with the attendees - from an industry veteran standpoint I would like to see it proven in daily life - a few months into a live implementation.
What impressed me was the strength of the customer statements - similar like at other SaaS vendor user conferences - it looks like the move to SaaS creates a higher level of business user commitment towards the software provider than the old on premise model ever did before. And when thought through - not so much of a surprise - as the business side needs to often justify the move with other corporate functions and IT - and likewise is kept busy with regular updates - so SaaS purchasing, implementing and using buyers are more involved with their software vendor than enterprise software users have ever been before. Very few software vendors can e.g. show in person reference statements from traditional arch enemies like Coca-Cola Corp and Pepsi Co. - SuccessFactors was able to.
First impression of SuccessFactors Talent
This was the first opportunity for us to sit down and see a demo of the SuccessFactors product - more or less realistically on the showfloor - with attendees driving the questions and direction of the demos. And our impression is that it is, what it was supposed to be - a pretty complete talent management suite. What surprised me most, how relatively easy it was to setup single talent functions e.g. performance management and succession - and comparing that with the high level knowledge I have of the SAP HCM talent modules. With the latter I certainly would not even think trying to do a setup myself - just do not know enough about it - with the SuccessFactors product it was just itching the fingers... (no worries SuccessFactors partners - no ambitions here).
The product also looks well integrated in comparison to two years ago when I saw it last from a SAP partners perspective at different industry shows. The clearly diverse user interface paradigms from the different acquisitions that SuccessFactors had done, are a thing of the past. Though personally I would like to see the company drive the user interface harmonization even a level more strict - at the end of the day consistency helps user interaction success - and the last few percent can move the needs quiet a lot here.
EmployeeCentral
This product was certainly the star of the show. Not surprisingly since both existing longer term SuccessFactors customers want to use it and need it - the reader may remember that SuccessFactors created EmployeeCentral before the SAP acquisition to form the new backbone for its products - and its equally of appeal to SAP HCM customers who are considering moving to the cloud.
And the product has made significant progress not only in geographical reach and functionality - but also from a technology perspective - exposing its meta data framework to customers, who now can (surprise, surprise) use the HANA cloud integration to build customizations as well as integration with other systems. Given the recent additions of customization capabilities in the market, a smart and necessary move.
It was also very good to see that the product direction of EmployeeCentral is not to rebuild the SAP HCM functionality with all its bells and whistles, thus avoiding complexity and challenges that have come along implementing such a powerful, but consequently complex product family. Likewise (and for now) there seems to be no interest to solve the need for the (complex) US benefits automation - which is left to partners. The same is the answer for complex time requirements - where the partners are Kronos and Workforce. And againthe same answer for BPO - where the partners are ADP and NorthgateArinso
For the BPO space I am willing to believe that the partner way will remain the SAP way - as for the benefits and time management pieces - only future will tell. We will be attentive observers if SAP will remain as firm in regards of direction when either the roadmap of EmployeeCentral is coming to a foreseeable maturation and / or on premise customers who want to move to the cloud will not only ask SAP - but all SaaS vendors - to provide complex time capabilities as part of an integrated suite. But for now the focused less is more perspective merits respect and applause.
Going forward
SuccessFactors will stick to the four yearly release cycle - and customers seem to be relatively happy with this cadence. It seems like the SuccessFactor release have proven to be quite digestible to the customer base, our informal conversations with attendees certainly pointed in that direction.
Moreover, it will be interesting to see how many large implementations SuccessFactors has secured (Pepsi Co anyone) and they probably will put the product direction and resources under duress. We certainly wish that this will not be the case - but we have seen too many product road maps getting hijacked by large and strategic customers. SAP will have to play it smart here, which the organization certainly has the capability to do.
The acid test to that questions is - where would SuccessFactors be with EmployeeCentral - had it remained a stand alone company. And one does not have to be wise man to foretell that SAP's funds and expertise have moved the EmployeeCentral product further along than a standalone SuccessFactors entity could have. But now SuccessFactors needs to balance out the needs of the talent management products vs the integration need and demand for EmployeeCentral. How fast e.g. the talent management products will uptake the meta data framework, and with that receive the ability to be customized, shed the old XML approach and use OData - will be an interesting milestone to watch.
MyPOV
One of the better user conferences we have attended, with energized products and excited customers. SAP will have to let SuccessFactors do what they do best, built HCM SaaS products - and equally SuccessFactors needs to deliver not only on a modern core HR product with EmployeeCentral but equally a compelling and well integrated talent management suite with leading - or at least good enough - functionality. Start with the user interface.
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