Headed for the Cloud Core HCM Software as a Service (SaaS) Landscape Research Christa Degnan Manning, Vice President, Solution Provider Research,

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1 Headed for the Cloud Core HCM Software as a Service (SaaS) Landscape Research Christa Degnan Manning, Vice President, Solution Provider Research, Bersin by Deloitte Deloitte Consulting LLP

2 Contents It s 2017: Does Your CEO Know Who Works Here? 3 Core HCM in Cloud 4 A New Concept of Core HCM 5 Why Cloud Now? 6 Cloud Conversion and Consolidation 7 Some Cloud Context 8 Core HCM Cloud Options 9 Categories of Core HCM Clouds 10 Core HCM Provider Pros and Cons 11 Considerable Caveats 12 Key Capabilities to Consider 13 Core Capabilities 14 Scale and Scope 16 Presales Experience 18 Key Capabilities to Consider (con t) Customer Success Model 24 Training and Enablement 26 Conclusion 29 Implementation Options and Expertise 20 Platform and Integration Approaches 22 Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 2

3 It s 2017 Does Your CEO Know Who Works Here? More Importantly, Does He/She Know Who Actually Works? What is the ROI of answering this? Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 3

4 Core HCM in the Cloud Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 4

5 A New Concept of Core HCM Simplifying Basic Capability The meaningful system of record of an employment relationship. Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 5

6 Why Cloud Now? HR Has to Do Something Without a single core HCM system, HR teams can spend hours of work compiling information from different applications and sources of data. By the time reports are delivered, too often information is incomplete, if not obsolete, and may not be very meaningful. Software as a Service (SaaS), is often the preferred delivery model for many software companies today, so shift to cloud is largely inevitable. Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 6

7 Cloud Conversion and Consolidation From Customization to Configuration Kronos Acquires SaaShr Single Instance Software On Premise Oracle Acquires PeopleSoft Infor Acquries Lawson Oracle Acquires Taleo Cornerstone Announces Link now known as Cornerstone HR ADP Acquires 2005 Workscape Multi-tenant SaaS in The Cloud On-Premise Implementations 2-10x cost of software Maintenance upwards of 20% original price annual fees Complex customizations can be challenging and resource intensive to upgrade SAP Acquires SuccesFactors Ceridian Acquires Dayforce Acquisition sources: SaaS Shifts software from capital to operational cost Can eliminate separate maintenance and upgrade fees Seeks to simplify implementations to configurations Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 7

8 Some Cloud Context Hybrid Here to Stay, Parallel/Patchwork Becomes Platform Source: Sierra-Cedar HR Systems Survey White Paper, 19th Annual Edition Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 8

9 Core HCM Cloud Options Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 9

10 Categories of Core HCM Cloud Providers Familiar Players for Large Enterprise Multinationals Enterprise Resource Planning Bersin defines ERP as a category of enterprise software that typically incorporates financials, HR, manufacturing, order processing, and customer relationship management in an integrated solution. Payroll/Workforce Management Bersin defines payroll services as those that manage the payment of employees and contractors within an organization, as well as other reward offerings, as appropriate. Workforce management is the discipline of tracking worker time, attendance, and, in more advanced systems, workers schedules and tasks that are used in calculating compensation and accrued benefits. Talent Management Bersin defines talent management as a set of integrated organizational processes designed to attract, manage, develop, motivate, and retain key people. The goal of a talent management program is to create a highly responsive, high-performance, sustainable organization that meets its business targets. Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 10

11 Core HCM Solution Provider Common Pros and Cons Heritage ERP Payroll/Workforce Management Talent Management Example Companies Infor Oracle SAP SuccessFactors Workday ADP Ceridian Kronos Ultimate Software Cornerstone OnDemand SumTotal Systems Main Model Pros Business can center on one single enterprise vendor Centralized operational data May support a consistent look and feel across all employee self-service apps Practical payroll and compliance-led HCM solutions Direct service delivery support can be occupied with core HCM software options Primary focus on workforce solutions Primary focus on employee self-service, talent-driven HCM Can extend existing clients solution investments More flexibility to change other solutions like pay and benefits providers regionally Main Model Cons Implementation and management services typically separate Can be a costly commitment to implement and maintain, or replace May lock companies into a single HR solution environment Have less operational maturity outside North America Definitely need to integrate for payroll/workforce management, and other capabilities Continued cloud consolidation Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 11

12 Considerable Caveats Partnering for a Platform KEY POINT Companies should be clear and confident on what they want to do with their people and talent management activities and why before they select a software provider. Increasingly, companies tend to not focus on specific features or functions of HCM software providers; rather they focus on aspects of service and support, implementation, and ongoing administration. Other primary areas for consideration in selecting any HR software have been factors such as interoperability, usability, configurability, vendor partnerships, and cost. A single software or solution to support all HR will likely never be the case for many. Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 12

13 Capabilities to Consider Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 13

14 Core Capabilities Compliance and User Experience Global Scope and Compliance Localization Data privacy/security Complex country requirements User Experience Beauty is in the Eye of the Beholder Administrative support Overall employee experience Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 14

15 Core Capability Questions to Ask Consider asking for references to live customers with employees as proof of applicability and adoption. 1 What kind of flexibility does the company offer? 2 How do they approach the development of their user interface/s? 3 When do they offer their solution s roadmap and documentation? Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 15

16 Scale and Scope Geographical Footprint and Services Orientation Geographical Footprint Feet on the street Data centers Support models Services Orientation Implementation approaches and ecosystems Application management services (AMS) Business process outsourcing (BPO) options Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 16

17 Scale and Scope Questions to Ask It s important to review company operating and business health details from public filings and historical performance. 1 What kind of Support and Service Level Agreements (SLAs) do they offer? 2 Do they offer any documentation on global regulatory compliance? 3 Do they offer managed services of any kind? Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 17

18 Presales Experience Be Cautious of Consultative Selling Caveat Emptor Knowledgeable Responsive Engaged Configuration Evaluate practices Establish use cases Demand demonstrations Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 18

19 Presales Experience Questions to Ask How you are treated during the sales process is often a good indicator of how you will likely be treated as a customer. 1 Are you comfortable with what you hear about your situation? 2 Are your concerns adequately addressed? 3 Do they show you your requirements clearly in action? Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 19

20 Implementation Options and Expertise Professional Services Resources and Ecosystems Who/What Will Help? SaaS staff Methodologies Templates Partner Options Tactical Transformational Operational Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 20

21 Implementation Options and Expertise Questions to Ask The real work of sustaining SaaS starts at Go-Live. 1 What are cloud, IT, HR, and company staff skills and tenure? 2 What third-party specialists and certifications exist? 3 What if any fees are charged/exchanged for initial support? Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 21

22 Platform and Integration Approaches API = Almost Providing Integration and Commercial Connections APIs Number Use cases Documentation Custom Connectors Complexity Cost Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 22

23 Platform and Integration Approaches Questions to Ask Accessing, Customizing, and Extending your Core HCM Solution 1 What included integrations exist? 2 What customizations are necessary or desirable? 3 How open and interested to innovate? Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 23

24 Customer Success Model Accountability in Enterprise Application Delivery SaaS Promises Telemetry Uptime Satisfaction Client Management Account models Handoffs Continuity Community Self-service support Development input Career networking Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 24

25 Customer Success Questions to Ask Investments, Institutions, Individuals, and Incentives 1 What named resources might you be assigned? 2 What compensation incentives are in place for SaaS staff? 3 How is community participation required/incented? Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 25

26 Training and Enablement Interface May Not Be as Intuitive as Intended Traditional Configurators Administrators Employees Custom Content Delivery Cost Just-in-Time Wizards Embedded Integrated with support/hr service delivery Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 26

27 Training and Enablement Questions to Ask Investments, Institutions, Individuals, and Incentives 1 What is available before, during and after implementation? 2 What customization can be done, how, and at what cost? 3 How is user adoption supported and sustained? Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 27

28 Conclusion Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 28

29 Conclusion Both internal business talent agendas and the external landscape of solution providers are moving targets. Core HCM in the cloud can be a catalyst for and a strategic enabler of profound workforce transformations that tap into human potential and revive gains in productivity. Yet cloud core HCM can quickly become complex implementation endeavors within existing enterprises already struggling to cope with change and needs to refresh and rationalize HR. Aligning talent strategy, programs, and processes with business strategy should determine when and how to move forward with any cloud provider. Plan for the relationship to be a longterm partnership, designed to adapt to and adopt change Copyright 2017 Deloitte Development LLC. All rights reserved. Headed for the Cloud 29

30 About Deloitte As used in this document, Deloitte means Deloitte Consulting LLP, a subsidiary of Deloitte LLP. Please see for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting. This communication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively, the Deloitte Network ) is, by means of this communication, rendering professional advice or services. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for any loss whatsoever sustained by any person who relies on this communication. Copyright 2017 Deloitte Development LLC. All rights reserved. Member of Deloitte Touche Tohmatsu Limited