Industry leader SAP offers the most popular options in the space. Their SAP HCM and SuccessFactors solutions optimise HR operations.
These two products, however, differ significantly in their deployment models, functionalities, and long-term viability. This article explores the key features, benefits, and considerations of SAP HCM and SuccessFactors, to help organisations make informed decisions. Whether seeking an on-premises solution with extensive customisation or a modern, cloud-based platform prioritising agility and innovation, understanding these systems is essential for choosing the right HR solution.
Understanding SAP HCM and SuccessFactors
SAP HCM and SuccessFactors are both HR management systems developed by SAP. Although developed by the same company, these systems represent the different generations of HR technology.
What is SAP HCM?
SAP HCM, sometimes referred to as SAP HR, is a comprehensive software module within the SAP ERP system designed to manage various HR processes within an organisation. The system supports functions from employee recruitment to performance management on-premises.
What is SuccessFactors?
SAP SuccessFactors is a cloud-based HCM suite that optimises workforce management and HR processes. The framework offers a comprehensive set of models covering the entire employee lifecycle, from recruitment to retirement.
Key differences between SAP HCM and SuccessFactors
Both modules aim to streamline and optimise HR processes at their core. However, there are a few differences to consider when looking for an HR system.
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SAP HCM
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SAP SuccessFactors
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Deployment model
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On-premises solution, installed and managed on the organisation’s servers.
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Cloud-based SaaS solution hosted and managed by SAP.
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Functionality
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Focuses on traditional HR functions like payroll, time management and employee administration.
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Offers advanced features for talent management, employee development and performance measurement.
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Customisation
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Highly customisable to meet specific business needs.
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Built on standardised best practices with fewer customisation options.
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Integration
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Integrates well with other SAP modules but may require more work with third-party integrations.
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Offers pre-built integrations with other SAP systems and easy integration with cloud-based applications.
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Benefits of SAP HCM for organisations
The benefits of SAP HCM come from its centralised nature, which enables central administration and increased efficiency in automating HR processes. HCM can seamlessly integrate with other SAP modules. Its core functionality covers core HR functions, and the system is highly customisable to meet business needs around issues like payroll and time management.
Benefits of SuccessFactors HR system
For SAP SuccessFactors, the benefits come from its cloud architecture. The system is accessible from any location, and extensive analytics and AI integrations are available to maximise its functions. The system also offers excellent support around people management, supporting strategic HR tasks such as talent management and recruiting.
Factors to consider when choosing between SAP HCM and SAP SuccessFactors
Both systems benefit organisations, and choosing between SAP HCM and SuccessFactors depends on specific needs. The decision should be made with the following points of focus:
Deployment model
Consider the IT capabilities and whether in-house infrastructure is available to support the setting up and maintenance of SAP HCM. A cloud-based solution may better fit a smaller organisation, requiring a faster and more agile deployment. Organisations can also consider hosting their HCM on external servers.
User experience & functionality
SAP SuccessFactors offers a more modern cloud-based functionality that can provide a better user experience. SAP SF offers advanced features that include talent management and employee training, while SAP HCM prioritises core HR functions.
Customisation & integration
For specific business needs, SAP HCM offers high customisation and the ability to integrate with other SAP modules. However, SuccessFactors’ pre-built integrations can help connect the modules easily with other cloud-based applications.
Cost
The upfront costs are higher due to the on-premises setup and licensing fees for SAP HCM. Businesses looking for a more scalable product might prefer to opt for the subscription-based model available with SAP SuccessFactors, which can minimise the initial investment costs.
Maintenance, updates & support
The on-premises deployment of HCM means organisations are responsible for managing HR software updates and maintenance. This means it’s best suited for businesses that have a capable IT department. Those looking to reduce their IT workload may prefer SuccessFactors, as SAP handles maintenance and upgrades.
It’s also worth noting that support for SAP HCM will end in 2027 as SAP shifts its focus to cloud-based products.
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Transitioning from SAP HCM to SAP SuccessFactors
Transitioning from SAP HCM to SuccessFactors is significant for organisations looking to modernise their HR systems. As of January 2025, this transition has become increasingly important due to SAP’s shift towards cloud-based solutions and the impending end of support for SAP HCM in 2027.
Organisations can make this shift a success by focusing on:
- Engaging stakeholders early in the process to gain buy-in and support.
- Defining clear objectives and scope for the transition.
- Deploying external expertise to guide the process.
- Allocating sufficient resources to the transition and establishing realistic timelines.
- Setting proper processes in place to handle data transfers to minimise risks during migration.
With the right solution, organisations can streamline their IT infrastructure and reduce costs while accessing the latest HR functionalities. Transferring to SAP SuccessFactors can enhance employee self-service capabilities and improve organisational talent management.
Are you ready to choose?
The choice between SAP HCM and SuccessFactors depends on an organisation’s unique needs, goals, and capabilities. SAP HCM offers a tried-and-tested, highly customisable, on-premises solution. For businesses looking for traditional HR functions and control, it’s a great choice over legacy infrastructure. For organisations that want a future-ready, cloud-based platform, SAP SuccessFactors can deliver advanced tools and innovative capabilities.
As SAP phases out support for HCM, transitioning to SAP SuccessFactors offers organisations an opportunity to modernise their HR systems and unlock easy scalability. Partnering with a trusted expert like Zalaris can help organisations navigate this transition effectively. With extensive experience in both SAP HCM and SuccessFactors, we provide tailored support, ensuring businesses maximise the benefits of their chosen solution with zero disruption to business processes.
From guiding deployment to offering ongoing maintenance, we are uniquely positioned to help organisations supercharge their HR operations. Get in touch with our team to start preparing for the future of work.