BlogERP: Jim Holincheck's HCM Software Blog

A Conversation with Claus Heinrich about Talent Management at SAP

I had a very interesting conversation with Claus Heinrich, SAP Executive Board member and head of HR.  We discussed what SAP is doing and wants to do for itself regarding talent management.

Job Rotations -- I have not discussed this on the blog previously, but it is an important talent management concept.  SAP wants leaders to be well-rounded and wants to do more to provide different types of experiences (which also leads to more versatility -- see Diane Morello's research (Gartner subscription required) on "Versatilists" for more on why this is important).  It is also a good way to get a fresh viewpoint into the HR organization (Claus himself started in supply chain management).  In addition, it is a good opportunity to get HR professionals more educated about the business and where HR can provide value.

Succession Management -- One of the things that struck me about Shai Agassi's departure from SAP was how fast it responded with a reorganization.  Now necessity is certainly the mother of invention.  However, SAP does a very good job of succession planning including regular talent reviews for key positions at the Executive Board level and ensuring that adequate bench strength is in place (i.e., at least one successor is ready to assume key positions).  These are good practices for all companies.

Globalization of Talent -- It probably comes as no surprise that SAP has global talent management needs.  Many companies do.  What was interesting was how it evolved.  Product development was strongly centralized in Walldorf, but SAP found 10 years ago that the pool of talent available in Germany was not going to be large enough to meet their growth objectives so they had to become a much more decentralized product development organization.  It changed the culture of SAP as well as required different competencies in managers (especially those who were managing a more virtual team).  I suspect that as talent shortages loom in many industries and job categories that more creativity in global talent sourcing will put increased strain on manager capabilities.  Good workforce planning that can surface these issues in advance can be useful to help manage this change.

SAP SAPPHIRE 2007 - Rio Tinto

I had a chance to go see a presentation by Rio Tinto, a global mining company, today on their efforts at Talent Management.  There were a few extremely important points made in the presentation:

• Understand the business need -- In Rio Tinto's case, the business imperative for talent management was a talent shortage for critical talent (e.g., mining engineers) to support growth
• Focus on defining the process first, then look at the technology -- Rio Tinto did a really good job defining talent management processes that work for them.  They have implemented integrated technology (SAP) for some of the processes, but have not implemented automation for all (though they will continue to automate more over the next couple of years).  Rio Tinto is a good customer for other customers to speak with about SAP's talent management capabilities, especially e-recruitment.
• Analysis is where the value is -- It is one thing to define a good process.  That is good.  It is also good to automate that process.  That is even better.  However, the best case is when you can use that data to make better decisions about talent.  One example that Rio Tinto gave was that by having a more comprehensive view of talent (and access to that data), they were able to understand their bench strength and redeploy people as needed.  In addition, when they had gaps that they could not fill internally, they had data about sourcing that allowed them to more quickly respond to new needs.

Are you doing all three in your talent management initiatives?

SAP SAPPHIRE 2007

I am at SAP's SAPPHIRE conference this week.  I am not going into all of the key themes from the conference.  We will be publishing a more comprehensive event note after SAPPHIRE in Vienna (we have more analysts attending there due to a conflict with Gartner Spring Symposium this week).  However, I wanted to comment on one key theme.

That theme is SAP as a platform for Business Network Transformation.  What is Business Network Transformation?  Well, it is the ability for a company to work with business partners (e.g., customers, suppliers, etc. -- the network) in a more agile fashion to gain and sustain competitive advantage.  It is an admirable goal.  However, it is a hard one to achieve.  Any transformation requires the right strategy, people, process, technology, and work environment.  SAP provides the technology and support for business processes, but it does not provide the rest.  Arguably, SAP can point to its ecosystem efforts and say that partners can provide the necessary services to fill in the gaps.  However, it is not a simple endeavor as the efforts in Business Process Engineering in the 90s has shown (and this was within the four walls of the enterprise).  I will be interested to see the customer examples that SAP puts forth to demonstrate how they enabled this.  Good customer examples were lacking at the Industry Analyst Summit last December.

links for 2007-04-20

• » Workday: ‘parity’ with SAP in 18 months | Software as services | ZDNet.com
  More on Workday and its ambitions
  (tags: SaaS ERP HCM)

links for 2007-04-19

• The Long Tailpipe - Shai Agassi's Blog: Does ERP Matter?
  Shai Agassi now has a blog. This is an excellent post on the future role of ERP and where "edge processes" (like talent management processes) fit in. Employee performance management even gets a specific mention.
  (tags: ERP EPM talentmanagement)

links for 2007-04-17

• Knowledge Infuser: 2007 Talent Management Survey Results!!
  More data on the interest in Talent Management.
  (tags: talentmanagement)

Two Tales of SaaS

The roles of SaaS is certainly a hotly debated topic.  I just saw two different views expressed recently.  First, in Red Herring, "Sassing SaaS" describes SaaS as hot, but focuses on its shortcomings.  It talks about the issues around security, customization, interfaces, service levels, etc. making SaaS not appropriate or desirable for certain industries and markets.  Second, in The Intelligent Enterprise Weblog, "Future of Enterprise Software in a SaaS World" describes how SaaS is already reality for many organizations and figures prominently in future buying plans.  It discusses how all the things in the Red Herring article, though important, are not critical issue.  The author argues that it is the acceptance of SaaS by enterprise IT organizations that is the biggest issue in implementing SaaS.

So which is it?  My experience with HCM applications is that only a small percentage of IT organizations are steadfastly against using SaaS.  They are concerned with security, customization, interfaces, service levels and more.  However, if it is the solution and delivery model that best meets the user needs, then they are supportive of it.  I find IT organizations more concerned with trying to leverage their existing applications and to minimize the number of interfaces they need to maintain.  The resistance is around using "best of breed" applications, not SaaS as a delivery model.

What do you think?  Is SaaS over-hyped?  Will SaaS vendors ultimately displace existing providers of enterprise applications?  Will SaaS vendors and traditional enterprise apps vendors continue to co-exist?

Kronos and Workbrain and the Wonderful World of Private Equity

Gartner First Takes are our initial take on events in the industry (they are also free, but research linked to the First Take might require a subscription).  So, I thought you might be interested in our thoughts about the recent Kronos and Workbrain acquisitions.

Hellman & Friedman Acquisition of Kronos Will Fund Further Growth

This is the first major purchase by a private equity firm in the human capital management arena. Kronos will gain access to more resources to support its global expansion and movement into talent management applications.

 

Infor's Acquisition of Workbrain Signals Bigger Push Into HCM

Infor's acquisition of Workbrain, a leading vendor in workforce management applications, signals a stronger push by Infor into the human capital management software market.

links for 2007-04-10

• A Cynic's Six Steps to Application Integration - Human Resource Executive Online - Story
  Bill Kutik has a funny, but accurate, take on application integration related to M&A and partnerships.
  (tags: HCM talentmanagement)