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Competitive Overview

2014 IBM Corporation

Topics

Company Overview

Go To Market Strategy

Product Roadmap & Comparison

Competitive Messaging

Overview
Basics

SuccessFactors is a provider of cloud-based human capital management (HCM)


software solutions. Founded in 2001, it was acquired by SAP in 2012 for $3.4
billion

Revenue & Profits

Total Revenues for 1Q 2014 was 3,698 million (5,004.5 million $) as compared
to 2,903 million in 1Q 2013 (3,931.5 million $) an increase of 5% from the
previous year.

Employees

1,447 (2011) (SuccessFactors Employees before being acquired by SAP)


SAP Employees : 66,500 (2014)

SuccessFactors was initially focused on the performance management space


and had been well regarded for its capabilities in that solution area as well as
Learning.

Solutions

Expanded its portfolio to complete HCM Solutions including:


Recruiting
Onboarding
Compensation
Learning
Performance
Social Collaboration

Key Clients

As of December 2013, SuccessFactor's Learning Management System had


over 600 customers with 11.5 millions users.
Its Talent Management solution had over 4,000 customers with 25 million
users
Some of the Key Clients include:
NASA LMS
Plantronics Recruiting, Performance, Compensation, Succession
Kawasaki Motors Corp., U.S.A. - Recruiting, Performance,
Compensation, Succession & Development, LMS
Novo Nordisk - Recruiting
AstraZeneca LMS

Leadership Team - SuccessFactors


Designation

SAP CEO and executive board


sponsors for SAP Cloud

Previous Company

Xerox Corporation
Siebel Systems
Gartner Inc

Lafarge (Canada)

Mike Ettling

NGA Human Resources


Unisys

Co-Founder and Chief Technical


Officer, SuccessFactors

Aaron Au

Informix
Aspect Telecommunication

Chief People
Officer,SuccessFactors

Claudio Vespucci

Hewlett-Packard

CIO and Head of Cloud Delivery,


SAP

Global Head of Cloud & OnPremise, HR, successFactors

Name

Bill McDermott

Ingrid-Helen Arnold

Business Results
Total Revenue by Region in millions
40000
35000

Total revenue increased from 16,223 million in


2012 to 16,815 million in 2013, representing
an increase of 592 million, or 4%.

30000
25000

16223

20000

12464

15000

10672

10000

1409
3620

1766
4435

5643
2009

5000

16815

14233
2637

2563

5091

6100

6366

6263

6991

7486

7885

2010

2011

2012

2013

2151

Mean ()
Asia Pacific Japan
Americas
EMEA

The growing revenue result primarily from a


426 million increase in cloud subscription and
support revenue and a 501 million rise in
support revenue.

Software and Cloud subscription revenue by region in millions


Revenue
from
software
and
cloud
subscriptions rose from 4,928 million in
2012 to 5,212 million in 2013, representing
an increase of 284 million, or 6%.

12000
10000
8000

4928
4125

6000

3424
4000
2000
0
5

5212

2735

722

901

849

1920

2130

555
1304

1540

1383

1565

1864

2107

2233

2009

2010

2011

2012

2013

459
893

Mean ()
Asia Pacific Japan
Americas
EMEA

Overall, software revenue declined 142


million or 3% from 4,658 million in 2012 to
4,516 million in 2013. In 2013, SAP HANA
contributed 633 million to total software
revenue.
Cloud subscription and support revenue
increased from 270 million in 2012 to 696
million in 2013. This increase is largely due to
the acquisition of Ariba on October 1, 2012,
and to continuing strong growth at
SuccessFactors and Ariba in 2013

Business Results Contd..


2013 Revenue by Industry in million
4500

4077

3779

4000
3500
3000

2988

2649

2500
2000

1691

1633

1500
1000
500
0
Discrete Manufacturing
Energy & Natural resources
Consumer

Public services
Financial services

Services

2013 Revenue Growth/Decline Rate by Industry

Energy & Naural Resources: Growth rate of 4% reaching 4,077 million


Discrete Manufacturing: Decline of 4% reaching 2,988 million
Consumer: Growth rate of 4% reaching 3,779 million
Public Services: Growth rate of 5% reaching 1,691 million
Financial Services: Growth rate of 13% reaching 1,633 million
Services: Growth rate of 7% reaching 2,649 million

From January 2013, SAP


rearranged it's industry
sectors
from
nine
groups into six to focus
better
on
the
requirements of existing
and
potential
customers.

Topics

Company Overview

Go To Market Strategy

Product Roadmap & Comparison

Competitive Messaging

Go To Market Strategy
SAP announced a unified global HCM go-to-market strategy making Cloud as the go-to
deployment option.
Focuses is primarily on providing cloud based solutions by the integration of SAP ERP
Core HCM portfolio and SuccessFactors
The roadmap shows synchronization in three key areas
Globalization
User interface
HANA
Globalization
Core SAP HCM is
expanding globalization to
cover more than 50
countries.
SuccessFactors is adding
globalization support for 51
countries and payroll
support for 22 countries

User interface

HANA

Core SAP HCM is working on


a friendlier, more social
interface.
SuccessFactors plans a
redesigned talent dashboard
and addition of social features
such as gamification and
forums through SAP JAM

Core SAP HCM is adding


HANAs big data architecture to
payroll to make payroll
processing and potential payroll
fraud detection faster through
in-memory processing that will
potentially accelerate these
functions by one to two orders
of magnitude.
SuccessFactors had
announced that it plans to run
SuccessFactors on HANA to
accelerate processing, and
continues the work to make
that happen

Go To Market Strategy Contd...


SuccessFactors HCM suite was to be SAPs go-forward solution for talent management.
go-forward means that any customers who wish to purchase solutions for these processes will be positioned with the
solutions highlighted in the Table below. SAP intends to focus its innovation investments in these solutions. However, SAP
will still sell, improve, and support the remaining on-premise solutions and are still available to all customers.

Summary of the HCM solutions-Line of Business for Human Resource


Functionality

On Premise Solutions

Cloud Solutions

HR Core

SAP ERP HCM


(including Payroll, Benefits, Time
Management)

SuccessFactors Employee Central

Performance & Goals

SAP ERP HCM

SuccessFactors Performance & Goals

Compensation

SAP ERP HCM

SuccessFactors Compensation

Succession & Development

SAP ERP HCM

SuccessFactors Succession &


Development

Recruiting

SAP E-Recruiting

SuccessFactors Recruiting

Learning

SAP Learning Solution

SuccessFactors Learning

Social Management

SuccessFactors Jam

Workforce Planning

SuccessFactors Workforce Planning

Workforce Analytics

SAP Business Objects for HCM


Analytics

SuccessFactors workforce Analytics

Mobile HCM

SAP mobile apps based on Sybase


Unwired Platform (SUP)

SuccessFactors BizX Mobile

Channel Strategy & Partnerships


As part of the Cloud strategy SAP has infused DNA of SuccessFactors into its business to create the most
comprehensive portfolio of cloud solutions in the industry.
And as part of this strategy SuccessFactors partners are transitioned and now members of the SAP PartnerEdge
program.
SAP PartnerEdge members will resell, service and build solutions on top of SAP Cloud, and have the opportunity to tackle
the fast-growing cloud market and offer best-of-breed cloud solutions and suites to their installed base customers and
prospects.
SAP is making partnering easier as one contract enables partners to sell all cloud solutions available as opposed to one
contract per cloud solution

Service
Partners

Channel
Partners

SAP
Software &
Technology
Partners
SAP Channel Partners invest in building proficiencies around selling and
supporting SuccessFactors products to be able to effectively offer their
customers and prospects the SuccessFactors HCM Suite
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Topics

11

Company Overview

Go To Market Strategy

Product Roadmap & Comparison

Competitive Messaging

Solutions
SAP HR Solutions

Core HR & Payroll

OnPremise

SAP
ERP
HCM

Talent
Management
(Cloud)

Workforce
Planning (Cloud)

SuccessFactors
Recruiting

SuccessFactors
Workforce
Analytics

SuccessFactors
Onboarding

SuccessFactors
Workforce
Planning

Cloud

SuccessFactors
Employee Central

Workforce
Scheduling and
Optimization

SuccessFactors
Learning
SuccessFactors
Performance
and Goals
SuccessFactors
Compensation
SuccessFactors
Succession
and Development

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Time and
Attendance
Management

Collaboration
SuccessFactors
JAM

As Part of its Cloud Strategy SAP's focus is


primarily on providing cloud based solutions
by the integration of SAP ERP Core HCM
portfolio and SuccessFactors Portfolio
In the above figure the solutions marked in
Grey are SuccessFactors' solutions
integrated with SAP HR Functions

SAP SuccessFactors Product Execution strategy


Optimize

Align
1
Performance
Management

Goal
Management

2
Recruiting

Workforce
Planning

Learning

Succession

Talent
Attraction

Improve
Retention

Learning
Build your
Management
Bench

Forecast
Supply &
Demand

Talent
Engagement

Calibrate

Social
Learning

Assess
Talent

Decrease
workforce Risk

Talent
Selection

Optimize
Budget

i-Content

Uncover
Hidden Talent

Talent Insight

Eliminate
Errors

Extended
Enterprise

Find the Best


every time

Identify Talent

Improve Goal
Alignment

Plan for Talent


Shortages

Revolutionize
Performance
Reviews

Strengthen
Accountability

Install a
Meritocracy

Boost
Employee
Engagement

Keep on Track

Compensation

Accelerate
3
Workforce
Analytics

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SAP JAM

SAP SuccessFactors' end-to-end HCM solution enables


businesses to:
1- Align,
2- Optimize
3- Accelerate their processes and help companies achieve key
objectives

SAP SuccessFactors Integration Strategy Hybrid Model


SUCCESSFACTORS
Talent Management Applications
CLOUD

Integration AddOn

Option 3

Option 2

Option 1

SAP HANA
Cloud
Integration

SAP NetWeaver
PI

ON PREMISE
SAP ERP HCM

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SAPs integration strategy is based around two types of integration technology: file transfer and middleware.
SAPs first integration package relied on a flat-file transfer, although from the third package (Service Package 2),
Middleware integration was offered via SAP NetWeaver Process Integration (PI) and
Middleware integration also will be available via SAP HANA Cloud Integration (HCI) platform

Feature comparison IBM Kenexa Vs. SuccessFactors


- Overall Functional Areas

Company

Mobile
Capabilit
ies

Social
Software

Competen
cy
Manageme
nt

Workforce
Manageme
nt

IBM
Kenexa
SuccessFa
ctors

Source: Bersin Talent Management Systems 2014

2014 IBM Corporation

Learning
Manageme
nt

ATS

Compen
sation
Manage
ment

Perform
ance
Manage
ment

Success
ion
Manage
ment

Feature comparison IBM Kenexa Vs. SuccessFactors


- ATS (Applicant Tracking System) Capabilities
Company

Sourcing

Requisition
Managemen
t

Applicant
Managemen
t

Application
Managemen
t

Candidat
e
Screenin
g

Candidate
Correspon
dence

Managing
Hiring

Onboardin
g

IBM
Kenexa
SuccessFa
ctors

Feature comparison IBM Kenexa Vs. SuccessFactorsPerformance Management Capabilities


Company

Goal
Manageme
nt

Appraisal
Management

Development
Planning

IBM
Kenexa
SuccessFa
ctors

Source: Bersin Talent Management Systems 2014


2014 IBM Corporation

Employee
Assessment

Performan
ce
Calibration
Support

Pay for
Performanc
e

Analytics

Feature comparison IBM Kenexa Vs. SuccessFactorsCompensation Management


Company

Salary
Banding
/
Structure
s

Job
Valuing /
Market
Pricing

Manager'
s Access

Budget &
Allocation
Manageme
nt

Incentive
Manageme
nt

Total
Compensati
on
/ Rewards
Statement

Pay
Equity
Analysis

Reportin
g&
Analytic
s

Administ
rative
Function
s

IBM
Kenexa
SuccessFa
ctors

Feature comparison IBM Kenexa Vs. SuccessFactors


- Learning Management
Company

Course &
Resource
Manageme
nt

Curriculum,
Learning
Plans,
and
Certification
Management

Learning
Content

IBM
Kenexa
SuccessFa
ctors

Source: Bersin Talent Management Systems 2014

2014 IBM Corporation

Surveys &
Assessments

Enrollment
&
Registratio
n
Administra
tion

eCommerce

Learning
Reporting

Key Clients Across Industries


Industries/Sectors

Client Name & Solution Deployed

Aerospace and Defense

NASA LMS
Plantronics Recruiting, Performance, Compensation, Succession &
Development

Automotive

Denso Australia Performance & Goals; Succession & Development


Kawasaki Motors Corp., U.S.A. - Recruiting, Performance,
Compensation, Succession & Development, LMS

Banking

Baloise Group & Bank of Butterfield - Performance, Compensation,


Succession & Development, LMS

Mediolanum & Royal Bank of Canada - LMS

Chemicals

Expro Group LMS & Employee Central


Umicore - Performance, Succession & Development, LMS

Consumer Products

Amway - Recruiting, Performance, Compensation, Succession &


Development
Hasbro - Recruiting
Parmalat - Jam, Performance & Goals
United Breweries Limited - Recruiting, Performance, Succession &
Development

Engineering, Construction and Operations

Healthcare

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Bechtel - Recruiting, Performance, Compensation, Succession &


Development
Sun Communities - Employee Central, LMS, Performance & Goals,
Recruiting, SAP Jam, Succession & Development
AstraZeneca LMS
Bon Secours Health System Recruiting
Dentsply - Employee Central, Performance Management, Recruiting,
Compensation
Novo Nordisk Recruiting

Key Clients Across Industries Contd..


Industries/Sectors

Client Name & Solution Deployed

High Tech

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AMD - Performance & Goals, Succession & Development


Barco - Compensation, LMS, Performance & Goals, Recruiting, Succession &
Development
NEC Corporation - Succession and Development, Performance and Goals
Yahoo - LMS

Hospitality

Destination Hotels & Resorts - Compensation, Performance & Goals, Succession &
Development
Hilton Worldwide - Compensation, LMS, Performance & Goals, Succession &
Development
Mandarin Oriental Hotel Group - Performance, Succession Management

Insurance

New York Life - LMS, Performance & Goals, Succession & Development
Suncorp Group - Performance & Goals, Succession & Development
Swiss Re - LMS

Manufacturing

Ahlstrom - Compensation, Performance & Goals, Succession & Development


CELSA - Compensation, Performance & Goals, Succession & Development
Diebold LMS
Leggett & Platt - Performance and Goals, Recruiting Management, Succession
Management

Retail

Brookshire Grocery Company - LMS, SAP Jam, Workforce Analytics


Express LMS
H-E-B Performance
Grupo Industrial Saltillo Performance, Succession Development

Telecommunications

Scripps - LMS, Performance & Goals, Succession & Development


TimeWarner Cable Recruiting
WDS, A Xerox Company Performance, Recruiting

For more information on clients and solutions please visit: http://ibmurl.hursley.ibm.com/MJP2

Topics

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Company Overview

Go To Market Strategy

Product Roadmap & Comparison

Competitive Messaging

Analysts Take on Kenexa


(Gartner, Forrester, IDC, Mclean & Company)

Kenexa, An IBM Company Named a "Champion" in McLean & Company's Talent Management
Suites Vendor Landscape Report 2013

Kenexa 2x BrassRing and Kenexa 2x Recruit solutions feature highly interactive dashboards,
integrated workflow management across recruitment, assessment and on-boarding, and real-time
reports that facilitate robust analysis across critical business processes. Customers who
implement Kenexa 2x BrassRing or Kenexa 2x Recruit increase the efficiency of their recruitment
processes, lower cost per hire, enhance the job seekers experience and reduce operating costs.
(http://talentmgt.com/articles/view/kenexa_2x_platform_drives_business_transformation)

Kenexa(IBM) ranked Number one by Capterra for Talent Management Solutions


(http://www.capterra.com/top-20-talent-management-software-solutions#.UMl1Y-SE2FL)

Gartner Positioned Kenexa in Visionaries Quadrant for Talent Management Suit (Gartner Magic
Quadrant 2014 Talking point on next slide)

Kenexa Positioned as Strong Performers for Talent Management by Forrester (Forrester Wave
Talent Management Q1 2013

Kenexa/OutStart LMS Innovation Award Earns an honorable mention, achieving the highest
overall Product score in the comparison. (McLean & Company LMS Vendor Landscape

2014 IBM Corporation

Gartner
Talking Points:
Emphasize that Gartner is reporting a backward view on "Ability to
Execute" using last year's (Q1-3 of 2013) Kenexa capabilities, rather
than a current view based on current IBM Smarter Workforce
capabilities, and this old (pre-IBM) view is not helpful to anyone
reading this report.
Gartner changed their ranking criteria this year (inappropriately we
believe) and Kenexa was penalized for not having the particular mix of
multi-product clients. For example, Gartner didnt count Assessments,
Onboarding, Analytics, CompAnalyst nor Surveys as separate
products, yet they list them as IBM strengths in their narrative. Now
that our Talent Suites Talent Acquisition and Talent Optimization
bundles have launched, as well as Social Learning, IBM should have
plenty of clients that meet their criteria.
IBM completely absorbed Kenexa into its global organization in 2013
and is now operating on all cylinders with all Global IBM resources
available. This transition hurt us in this report due to a short-term
impact on execution in 2013, but is well behind us and we lost no
significant clients.
IBM improved the most of any vendor. We moved up from ranking 9th
last year to 4th this year
IBM Connections is the #1 Social Business solution in the market (#1
for 5 years in a row, IDC) Connections is the backbone of our
Talent Suite and embedded in every module. This provides IBM
with better social/collaboration capabilities than any of our
competitors.
Gartners definition of what is needed in a Talent Management suite
included Workforce Planning, which hurt our ranking because
we dont have it. This should be pointed out to prospects who
are not yet asking for Workforce Planning.
2014 IBM Corporation

Capterra

Source: http://www.capterra.com/talent-management-software/#infographic
2014 IBM Corporation

Capterra Top 5 By Total Customers & Users


Contd

Source: http://www.capterra.com/talent-management-software/#infographic
2014 IBM Corporation

Forrester & McLean

2014 IBM Corporation

SuccessFactors
Challenges
SUCCESSFACTORS CUSTOMER

SUCCESSFACTORS INTEGRATION & FEATURE CHALLENGES

CHALLENGES

Challenges faced in creating and maintaining integration


between SAP ERP HCM and SuccessFactors for the hybrid
model. Integration is fairly limited for the hybrid approach and is
restricted to selected talent management processes.

SAP has communicated large parts of its strategy but most of it


is constantly evolving and no proper disclosure regarding this.
Many users simply do not have access to or know what
channels to look at for this information

While users who already have an SAP NetWeaver PI


installation in house can benefit immediately from SAPs
integration packages, those that do not have to invest in an
SAP NetWeaver PI implementation and the associated licensing
costs.

Customer support feedback is mixed,


especially outside North America; the
implementation-to support handover and
after-sales care processes got negative
ratings.

Overlap across many solutions. Employee Central is the least


mature of SuccessFactors solutions

From a product perspective, reference


customers cited integration with other
applications, documentation of the solution
and training made available as areas
where satisfaction was lower than the
average of this reference set

Although SAPs recruiting engine like its performance


management engine is one of the strongest around, eRecruiting does lack usability, presentation, and social media
integration

If SAP NetWeaver PI is not implemented then either an


implementation of SAP NetWeaver PI or an implementation of
the forthcoming SAP HANA Cloud Integration platform is
required. An implementation of SAP NetWeaver PI would
require both a license for PI and the additional costs of an
extended implementation project that could take upwards of six
weeks

Although easy-to-use, the corporate


career portals are not as attractive as
those of other vendors and do not provide
much customized branding (i.e. look very
similar across clients)
SuccessFactors customers have reported
that support and service has declined
dramatically in the past two years and that
the architecture is very inflexible
Although it has highly integrated
partnerships, it is the only vendor
evaluation
to
not
offer
administration as a native part
application.

payroll
in this
payroll
of its

Ongoing communication and customer


support feedback was mixed, especially at
the lower end of the market

Source: TM Vendor Landscape 2013, Gartner Talent Management Magic Quadrant 2013 & 2014
Source:https://sapexperts.wispubs.com/SAP-and-SuccessFactors-An-Overview

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Key Differentiators
SAP SuccessFactors

Rank

Biggest Player and Most Awarded

Top 10 Biggest Player

Key Emotional Selling Point

Simplify Everything with SAP Cloud


Powered by SAP HANA (Including
SuccessFactors Product Portfolio)

Human Psychology
Our solution is driven by analytics and our
understanding of human psychology to
reinvent the way workers drive business
outcomes.

Execution Software
While every company has a strategy,
most companies do not execute on their
strategy as well as they can or should
Thats where we come in.

Value Proposition

Offer solutions and services to help


customers run better today and tomorrow

Unique Product Features

Capabilities

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Smarter Workforce

360 Support
We have the technology + science + the
consultants to help succeed.

Full ERP HCM integration


JAM (Social Product)
Leader in performance management
and learning
Reporting and Dashboards

Cognos (Predictive Analytics)


IBM Connections (Social Product)
Talent Assessments (Services)
Leader in recruitment

SuccessFactors is focused entirely


on the software capabilities and has
no capabilities around services and
elements like behavioral sciences,
which are critical for truly making the
human resource processes smart

IBM has unparalleled expertise in


behavioral sciences and consultative
services which allows us to help
clients apply science and precision
to
workforce
decisions
and
processes

IBM Kenexa vs SAP SuccessFactors


Why SAP/SuccessFactors Wins

Why IBM/Kenexa Wins

Deals where Performance Management is


key focus of buyer. SuccessFactors has the
industry leading Performance Management
solution
Buyers seeking a fully integrated suite with
consistent user interface
Best track record among the major vendors to
converting component customers into suite
customers according to Gartner
Good user experience with Reporting and
Dashboards
Current SAP HRIS customers will certainly
favor SuccessFactors for Talent Management
if it is simply a technology buy.

Deals where Sourcing and Recruitment


Technology are the key focus of the buyer.
BrassRing widely seen as a top recruitment tool
in the market
Kenexa has stronger mobile capabilities across
the Talent Management Suite integrated into
the products than SF
When buyers are looking for more than
technology. Workforce sciences set Kenexa
apart on many large deals
Non-SAP HRIS clients (Oracle, Workday) which
are concerned about the functionality of SF on
their HRIS platform
Clients who see the purchase broader than
Talent Management and understand that
service, consulting, and science are needed to
truly transform their organization.
Newer additions of Smarter Workforce offerings
around Social, Web Experience and Analytics

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