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SAP ERP Payroll and HR Software Review

4 stars Average rating: 4 (from 152 votes)

SAP Best Fit & Competitors

SAP Sweet Spot

Although the breadth of SAP’s product portfolio enables it to cater to any client, from small companies to some of the largest enterprises in the world, the target market for the SAP ERP HCM software is the broad middle market with workforces from 100-999 employees. In a sense, the targeting reflects that this size range represents the single biggest opportunity for the company to grow its customer share rather than any software design principle. Despite this focus, it is the larger enterprises that remain SAP’s core client base, not least because of the fragmentation in the desired market layer (coupled with the increase in SaaS ERP and HCM solutions available).

When it comes to specific industry sectors, SAP actively invests in the delivery of industry-specific software solutions in 26 verticals, and the company's various partner channels offer inroads for many more. That said, SAP has met with considerable success in meeting the requirements of business services, government, retail, telecomm, banking, and utilities. A sample of SAP’s marquee customers would include Siemens AG, Sara Lee, Sharp, Exxon Mobil Corporation, and Wal-Mart Stores Incorporated.

When you’re looking for a payroll solution, shortlist SAP if:

  • You're a mid-market organization looking for "World Class" HR software functionality that can't be delivered by smaller enterprise packages.
  • You're seeking an approach to efficiencies and process management that is "standards-based."
  • You're a large, global company and an existing SAP customer using SAP software in other ERP areas such as Financials but have not yet deployed payroll/HR.

Alternative Solutions

Payroll and HR software buyers may wish to look further afield if:

  • You’re looking for best-of-breed or payroll/HR-only software solutions.
  • You’ve decided on a cloud or SaaS solution.
  • You need a scalable solution with low up-front expenditures and quick deployment.
  • You require easy-to-use customization functionality that doesn’t require recourse to the vendor.

SAP Competitors

Predictably enough, Oracle, Infor (which also happens to own the powerhouse Lawson), and Sage are SAP's primary competitors within the HRMS software arena. However, due to factors such as market consolidation and the continuing upwards trend of SaaS payroll and HR solutions, the smaller (but infinitely more innovative) vendor Workday is now offering stiff competition. Further pressure is coming from the direction of Kronos and ADP thanks to their increases in functionality over the last few years.

Concluding Remarks

Not surprisingly, SAP's primary competitors within the HRMS software space are Oracle, Infor (which also happens to own the powerhouse Lawson), and Sage. However, due to a confluence of factors such as market consolidation; the rise (and influence) of talent management software; and the trending upwards of the Software-as-a-Service (SaaS) model, SAP also finds itself in stiff competition with the smaller (but infinitely more innovative) vendor Workday. Further, the increased functionality that Kronos and ADP have achieved over the last few years has put increased pressure on the German vendor.

Concluding Remarks

Recent events are demonstrating that SAP now has a strong vision for its HCM solution over the coming years and with the leveraging of SuccessFactors to take the company’s payroll and HR applications into the cloud (and into new markets) it's clear that SAP both recognizes and values the impact that the right HR software can have for a company. However, the software giant must continue to make efforts to act in a more agile fashion if it is to quickly respond to (and predict) market influences and customer desires and leave behind its past strategic errors.

The global picture is that legacy software such as the SAP ERP HCM suite is on a slow but steady decline and businesses increasingly opt for the cloud as a deployment option. It’s not so much that on-premises deployments harbor problems per se, more that customers are more attracted to the benefits of SaaS. Therefore, SAP (like others of its ilk) is faced with an ‘evolve-or-fade-away’ dilemma; one which it appears to be taking slowly but nevertheless surely.

Perhaps the key factor here may prove to be longevity and experience. After all, SAP has been in this position before, surfing the waves of change – as personnel (and by proxy, the supporting software) morphed into human resources, then to human capital and beyond – and with good leadership, a bulging portfolio of best-of-breed solutions, and a solid customer and partner ecosystem, the company has all it needs to survive and thrive this paradigm and the next… if it can just move from lagging behind the changes to anticipating them.

SAP ERP HCM ReviewSAP HCM Software ReviewSAP HCM CapabilitiesSAP HCM Technology ReviewSAP HCM PriceSAP Company ReviewSAP HCM Strengths & WeaknessesSAP HCM Competitors

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