The HfS Workday and Salesforce Services Blueprints in 2015 assessed a new set of ecosystems that will play pivotal roles in the As-a-Service Economy. Following this theme we have launched the SuccessFactors Services Blueprint.
Exhibit 1 details the SuccessFactors value chain services we are covering.
Exhibit 1: SuccessFactors Services Value Chain
HfS is in the midst of evaluating 14 providers on their capabilities and vision for this space. Here we share a few of the emerging highlights:
- SAP link is important to investment: SAP acquired SuccessFactors in 2011, strengthening the SaaS product’s credibility for service providers and enterprise buyers alike. Service providers that may have dabbled in ad hoc projects beforehand have started to invest more strategically in SuccessFactors services skills and capabilities, particularly those with existing strong SAP service practices. Enterprise buyers confirm that having SAP ERP in the back-office remains a strong reason to select SuccessFactors for their SaaS HR solutions, over alternatives such as Workday.
- SuccessFactors implementation services dominate today: Several buyers tell us that they used a specialist boutique consulting provider to help with product selection and the technical roadmap. They then contracted a global service provider for the technical deployment, within the framework that has already been set. While the service providers are receiving relatively good scores in our emerging Blueprint report, buyers admit that this selection strategy limits the service providers’ ability to demonstrate vision and thought leadership.
- Application management services growth: Service providers are seeing demand in this space as buyers realize the importance of post go-live support. Some service providers are also offering flexible support service options with varying pricing methodologies. These include clients purchasing a bundle of hours to use per month, fixed pricing with limitless requests per month, and paying for services used after the event.
- HR function and process expertise is key: Service provider talent investment and enterprise buyer demand is focused on deep HR function and process expertise. Interestingly, buyers tell us that they are not as interested in the service provider’s knowledge of their industry sector, as they are about its ability to share best practices in HR and how to get the maximum business benefits from the SuccesFactors deployment.
- Talent shortage: Similar to the Workday and Salesforce service markets, skills are scarce in the SuccessFactors services market. This is somewhat mitigated by the opportunity to cross-train SAP consultants in SuccessFactors modules.
- Not much feedback yet about Intelligent Services: In Why SaaS Vendors Need A Definitive Robotic Process Automation Strategy we outlined SuccessFactors’ launch of Intelligent Services in August 2015, which automates process steps in SuccessFactors. We have not heard much about the implication of this from service providers at this stage of our study but we will continue to monitor this as we finalise the Blueprint.
We are continuing to talk to service providers and client references and look forward to sharing the findings in the SuccessFactors Blueprint in March 2016.
