Architects Of The As-a-Service Economy Khalda De Souza Principal Analyst, Services Strategies [email protected]Charles Sutherland Chief Research Officer [email protected]HfS Blueprint Report SuccessFactors Services 2016 Excerpt for Accenture March 2016
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HfS Blueprint Report - Accenture · HfS Blueprint Report SuccessFactors Services 2016 Excerpt for Accenture ... Employee central andemployee central payroll n SuccessFactors Talent
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Introduction to the HfS Blueprint Report: SuccessFactors Services 2016
n The 2016 HfS SuccessFactors Services Blueprint Report continues our theme of looking atservices sets regarding the planning, implementation, management, and operations ofleading software-as-a-service platforms.
n Unlike other quadrants and matrices, the HfS Blueprint identifies relevant differentialsbetween service providers across a number of facets under two main categories: innovationand execution.
n This Blueprint Report looks at the innovation and execution capabilities of thirteen serviceproviders in detail and provides a mini profile of capabilities for two more. These serviceproviders are the leaders in this market and the major partners for SAP SuccessFactors indelivering this platform to enterprises today.
SAP PartnerEdge: Service Programn SAP PartnerEdge Program: SAP has simplified its partner program, which extends to
SuccessFactors service partners. It is a tiered system that includes partners from thosefocusing on resale to those providing deep business insights. All partners have access toinformation, advice, training, and tools. There are two broad levels of partners:
n SAP PartnerEdge Open Ecosystem for Service: This is for smaller consulting and systemintegration providers and practices initializing their relationship with SAP andSuccessFactors. Partners have access to some free information, training, and tools.
n SAP PartnerEdge for Service: This is for established SAP SuccessFactors service providersand practices. Partners must pay an annual fee and commit to continuous improvementto remain part of the PartnerEdge program. There are three levels of partnership withinthe SAP PartnerEdge Service program: Silver, Gold, and Platinum. Partners can move upto the next level by accruing Value Points, but Platinum partners are selected bySuccessFactors invitation only.
n Run SAP Solutions: This includes SAP Outsourcing and Operations partners. SAP providescertification of local or global support capabilities. Examples include IBM and TCS.
n SAP is transitioning SuccessFactors service provider partners to the PartnerEdge program,including re-aligning partner levels to the new definitions (Silver, Gold, Platinum).
Additional SAP Partner Levelsn Partners can also achieve the following partner levels:
n Global Strategic Services partner: Examples include Accenture, Capgemini, Cognizant,HCL, IBM, NTT Data, and Wipro.
n Global Services partner: Examples include EY, Hexaware, NGA Human Resources, andTCS.
n Global Value Added Reseller: This includes nearly all the providers included in theBlueprint.
n Business Process Outsourcing partner: Examples includeHCL, TCS, and Wipro.
n Other partner levels include: Global Technology Partner, Education Partner, andApplication Development Partner.
n A service provider may hold a specific partner level for just one country or region.
n In the SuccessFactors Service Blueprint, we highlight the Silver, Gold, or Platinum levels thateach service provider has achieved, where this has been finalized.
n SuccessFactors Workbooks: These outline how to configure the different modules. Serviceprovider partners can use and enhance these for clients.
n Intelligent Services: SuccessFactors launched Intelligent Services in August 2015. Thisautomates process steps in SuccessFactors and includes intelligent services that provide acustomized end-user experience.
n Partner Portal: Service provider partners have access to a partner portal that suppliesinformation, advice, training, and tools.
n SAP Product Road Maps: These explain the planned development of a feature or function ofeach product for clients. This includes recent changes available, upcoming developmentreleases in 12 to 18 months, and proposed themes for products beyond this time.
n Certifications: Service provider partners can achieve certifications in each of theSuccessFactors HCM suitemodules.
Implementation Services Represent Half of the Current SuccessFactors Service Market ApproximatesplitofSuccessFactorsServiceBusinessbyValueChainService*
n Implement:ThisisthebiggestpartoftheSuccessFactorsservicemarkettoday.DeploymentsrangefromsinglecountrytoglobalandfromsinglemoduletotheentireHCMsuite.Inthelattercase,enterprisestendtoimplementoneorafewmodulesatatime.
n Manage:Thisisstillanafterthoughtformanyenterprisebuyerswhotendtonegotiateashort-termcontractwiththeimplementationpartnerthattypicallycoversjustafewmonthspost-deploymenttoironoutanyearlyissues.Therearealsoafewexamplesoflonger-termsupportservicecontractsinthemarket.Asthemarketmaturesandenterprisesrealisethattheyneedongoingsupport,weexpectthemanagementservicesmarkettogrow,especiallywithanas-a-serviceflavorofflexibleservicesandad-hocaccesstoadviceandskills.
n Operate:Thereisverylittleworkintheoperatephaseofthevaluechain.ServiceproviderswithgeneralHRBPOcapabilitiesarebestplacedtotakeadvantageofthismarketasdemandgrows,butwedon‘texpecttoseerapidgrowthintheshortterm.
n Optimize:Thisremainsthesmallestpartofthemarkettoday,butweexpectittogrowaggressivelyandcreaterealopportunitiesforserviceprovidersabletooffertheflexibilityofservicesrequiredinthisphaseespeciallyforalignmenttotheevolvingHRstrategy.
n LackofstandardizedglobalHRprocesses:ThisisthemostcompellingreasonenterprisesareseekinganHRsolutiontoday.Clientswanttoachievetechnicalstandardizationtofacilitatebetterprocessmanagementacrosssites.
n InadvertentpurchaseofSuccessFactors:SomeenterpriseshaveboughtlicensesforafewoftheSuccessFactorsmodules,typicallyEmployeeCentralandRecruitment,becausetheywereincludedinabundlefromSuccessFactors.Theseclientsneedassistancetoimplementandgetthemaximumbenefitsfromthemodules.
n SAPlinkimportant:EnterprisebuyersconfirmthathavingSAPERPinthebackofficeremainsastrongreasontoselectSuccessFactorsfortheirSaaSHRsolutionsoveralternativessuchasWorkday.
n Interestinanalytics:ClientswhohavesuccessfullyimplementedsomeSuccessFactorsmodulesandhavegoodvisibilityoftheirHRoperationareincreasinglyinterestedinthevaluethatanalyticscanaddtotheirHRprocess.
n MixoftypeofSuccessFactorsserviceproviders:TheSuccessFactorsservicemarketconsistsofITserviceprovidersandHRspecialistserviceproviders.Thismakesitalargeandcomplicatedserviceecosystem.
n Cloudandhybridsolutionslandscape: Whilesomeenterprisesdecidetodeployafullcloudsolution,othersareoptingforahybridmixofon-premiseandcloudHRsolutions,requiringintegrationskillsfromserviceproviders.
n Demandforserviceskillstosupportallthemodules:ThetopthreemodulesimplementedareRecruitmentManagement,PerformanceandGoals,andLearning.However,theclientswespoketorangedfromthoseimplementingjustoneoftheHCMmodulestothoseworkingwiththeentiresuite.
n PayrollandWorkforceAnalyticsaregrowthmarkets:Serviceproviderswhohavedevelopedservicesandsolutionstosupportandexpandthepayrollandanalyticsmoduleshaveopportunitiestogrow,astheseareasshouldincreaseinpopularityinthenext12to18months.
n Buyersprefertocontractconsultingskillsseparately:MostSuccessFactorsserviceenterprisebuyersprefertoworkwithaspecialistconsultingproviderfortheplanningphaseoftheSuccessFactorsserviceengagementinordertogetaccesstowhatisbelievedtobethemostadvancedHRadvice.ThiscanbewithoneoftheBigFour,includingDeloitteandEY,aspecialistboutiqueconsultingfirm,orevenjustin-houseskills.Alltheblueprintandroadmapworkisfinalizedinthisstage.
n Implementationserviceprovidersselectedfortechnicalservices:Enterprisescontractimplementationproviderstodeploytherequiredmodulesinaccordancewiththeroadmapestablishedintheplanphase.Thereisoftenlittlescopeforimplementationserviceproviderstobringvisionandthoughtleadershiptotheengagement.Interestingly,clientsoftenrealizepost-deploymentthattheywouldhavevaluedtheimplementationproviderdeliveringmorebusiness-focusedadvice.
n IntelligentServicesstillingrowthphase:InAugust2015, SuccessFactorslaunchedIntelligentServices,whichautomatestheprocessstepsinSuccessFactors.Asyet,itdoesnotseemtohavemademuchimpactonserviceproviders,butthismaychangeoverthenextfewyears.
n Sell-SideExecutiveBriefings:Structureddiscussionswithserviceproviderswereintendedtocollectdatanecessarytoevaluatetheirinnovation,executionandmarketshare,anddealcounts.
n PubliclyAvailableInformation:Financialdata,websiteinformation,presentationsgivenbyseniorexecutives,andothermarketingcollateralwereevaluated.
n EachprofilealsoincludesalistofacquisitionsandpartnersthatarerelevanttotheSuccessFactorsserviceofferings’developmentand/ordelivery.SAPisastrongpartnerforallserviceprovidersintheBlueprint.WehavenotlistedSAPineachindividualserviceproviderprofile.
Geographical coverage in order of revenue:North America, the UK,Continental Europe,Middle Eastand Africa, India, ANZand otherAPAC, LatinAmerica
Industry Coverage:Most industries
Some publicly disclosed clients include:• Alcatel-Lucent, AngloGold Ashanti, Comcast• Disney and Boston Scientific, EtihadAirways• NBCUniversal, Procter andGamble, Timken
• Partner Level:Platinum• Yearof Practice Established: 2009• Number of SuccessFactors-Certified Consultants:
435• Number of SuccessFactors Certifications: 591• TotalNumber in Practice: 1,200+• Number of Clients: 150+• Number of Engagements Completed orOngoing:
500KeyDeliveryLocations for SuccessFactors Practice:• EALA: UK,Den, Swe,Switz,Ger,Port, Sp,It,Fr,
Bel, Pol, Israel,S.Africa,ME,S.America• North America: United States,Canada,Mexico• APAC: Aus,NZ, Japan,China, S.Korea,
Singapore, Philippines, Malaysia, Thailand,India
• Accenture High-Velocity Talent and HR:Pre-configuredsolutions for fast implementation
• Packaged CloudMethodology for SuccessFactors: AccentureDeliverySuite(ADS) deliverymethodology for SuccessFactors
• Accenture SuccessFactors’ Data Conversion Toolkit• Accenture SuccessFactors’ Test Automation Toolkit• Accenture Human Capital Operating Model• Accenture's HR360 Diagnostic: Tool tocapture business
objectives and challenges• Accenture HR Auditand Compliance As-a-Service:
SuccessFactors’ extension onthe SAPHANAplatform.Accenture Clone and Testfor Cloud: SAPHANAcloud extensionfor Employee Central
• AccentureQuick Document Builder for SuccessFactors:Automates correspondence sent toemployees andmanagers
Strengths Challenges
• DeepUnderstanding oftheProduct: Accenture hasworkedwith SuccessFactors since 2007 andhelped tobuild theEmployee Central product in2011, before theSAPacquisition. Accentureand SuccessFactors jointlyimplemented the firstten projects of Employee Central. Accenture isalso supporting SAPtoimplement SuccessFactors internally. This experience increasesAccenture’s credibility as aSuccessFactors serviceprovider withdeep technical skills.
• Strong SuccessFactors Services Capabilities: Accenture has thelargestSuccessFactors practiceinthe Blueprint, including thenumber of certified consultants. Thisisunderpinned byateam ofmore than 8,500 professionals focused on thehuman capitalmarket. Accenture offers thecomplete value chain of SuccessFactors services. In itsdifferentiating flexible factorymodel forapplication outsourcing services, resources can be shared across engagement teams, leveragingthenecessary skillsand capacity on demand.
• Scale: Accenture has themost comprehensive range of SuccessFactors servicedelivery centersinthe Blueprint, withcenters ineveryregion intheworld. Clients highlighted geographical scaleasastrength for Accenture.
• Delivering Value and Being Responsive: Accenture’s highest reference scores areforincorporating feedback and delivering valuebeyond cost savings. One reference said thatAccenture scored “an absolute 10” out of 10for delivering value.
• Continued Investment inTools: Asaleader inthismarket,Accenture should continue toextend and innovate theHANAcloud platforms, especially for industry sector-focused solutions, which arerareinthismarket.
• Strengthen Capabilities in Payroll:Accenture shoulddevelop andstrengthen itscapabilities inSuccessFactorspayroll services. This isagrowthareain themarket.
• Growth in APAC and LATAM: Mostof Accenture’sSuccessFactors service business comes from themainregions of North America, the UK,and Europe. Given itsscale, Accenture has opportunities to strengthen itsbusiness in LatinAmerica and APACinthe next fewyears.
• Clients NotAlways Seeing the Vision: Afewclientshighlighted thatAccenture didnot alwaysbring thoughtleadership totheengagement. Thisissurprising, givenAccenture’s strength inthis area.This ispartlydue toclients contracting for implementation workonly havingalreadyset theroadmap, including the vision in-house. Italso points toapossible opportunity for Accenture deliveryteams toidentify client demands and capitalize on newrevenue possibilities.
SuccessFactors Services Buyers: Service Provider Selection
Top three SuccessFactors service provider selection criteria:
n Existing relationship: Most of the clients we spoke with selected their SuccessFactorsservice provider based on the fact that they had an existing relationship. Clientsrecognize that selecting a service provider that understands their business priorities is abig advantageover selecting a new provider who would need to learn this.
n Price: Price remains a top-three selection criteria for clients, but there is an increasingawareness of the underlying value delivered for the price paid. Purely being cost-effective is not an advantage on its own. Clients like to know what they are paying forand receiving business value.
n Capabilities and scale: The third most important SuccessFactors service providerselection criterion is technical capabilities to deploy the different HCM suite modules.Enterprises with international offices also require proof that the service provider hasdelivery capability in different countries and/or a good understanding of local laws, HRregulations, and business culture.
n HR process skills knowledge: SuccessFactors service clients define value in terms of theservice provider’s ability to share HR process best-practice experience and advice. Thisincludes providing a holistic view of the HR process beyond the individual technicalmodule deployment.
n Account management: Good account management is strongly aligned to high clientsatisfaction rates. Clients appreciate working with a person or team that is committed tounderstanding technical and business issues and being responsive to all requests.
n Flexibility: Clients expect and appreciate flexibility in engagements. Even with a well-thought-out roadmap, there are often required changes or tweaks in the deploymentphase. Clients appreciate service providers who are flexible to tweak service delivery andoffer flexibility in the associated pricing models. Contracts with strict statements of workare not the norm in successful SaaS services engagements.
Recommendations: Service Providersn Invest in functional understanding and adopt a holistic approach to HCM: Clients
highlight that HR-process best-practice advice is the single most important definition ofreal value in a SuccessFactors service engagement. Service providers with an HRbackground, such as NGA HR and those with strong HCM practices, are in anadvantageous position. These and other service providers must focus on hiring talentwith HR process skills and experience.
n Partner for or market consulting services capabilities: Enterprises tend to contractSuccessFactors consulting services separately. Service providers with little or noSuccessFactors consulting service capabilities should consider partnering with a strongconsulting provider to offer this to clients and to ensure implementation servicereferrals. Service providers that have invested in SuccessFactors consulting servicesneed to aggressively market these to existing and potential clients to ensure beingconsidered on RFP short lists.
n Bring the vision to implementation services: Service providers should offer business-oriented advice in implementation service engagements, for example, providing aholistic view of the HR process versus purely deploying the modules. Enterprises do nottend to ask this of their implementation partners as they do not expect to need it, butafter deployments, they admit that this would have brought important added value tothe engagement. Service providers must be proactive in sharing their business-focusedknowledge and capabilities with clients so that they are fully aware of the servicesavailable to them.
Recommendations: Service Providersn Upsell management services more aggressively: Service providers should be proactive
in explaining the importance of post-deployment management services to clients. Toomany SuccessFactors implementation service providers are missing clear opportunitiesto upsell management services.
n Invest in tools and technologies: Service providers should continue to invest in toolsand technologies to enhance their SuccessFactors service offerings. Most of the serviceproviders in the Blueprint have made good investments in this area, but there are still alot of opportunities for growth. In particular, investments in HANA extension tools andindustry-focused templates and tools will stand out in this crowded market as cleardifferentiators.
n Invest in account management skills: Service providers should prioritize strengtheningaccount management skills to foster deep relationships with clients. This is an importantfactor in client satisfaction as well as a major consideration to engage the serviceprovider for additional work.
n Be flexible: Enterprises like to work with service providers who are flexible. Serviceprovider teams should prioritize client needs and deliver the required service, withoutbeing constrained by strict contracts. Flexibility is also a key element to successfulmanagement and optimization services, where access to specialists is preferred on anon-demand basis.