Considerations for selecting SuccessFactors vs Workday for your organization

In this post, I will share with you comparisons of SuccessFactors with Workday and hope it helps in your software selection process. I managed several SuccessFactors projects and have hands on experience. My knowledge about Workday comes some from reading about it and some from Workday consultants. You can click on the links to go directly to a topic that interests you although I recommend the first time, you read through all topics.


Introduction

The mission of Human Resources is to lead and manage strategic alignment of HR systems resources to support faster decision making, more effective workforce management, and improve resource alignment with the organizations missions. A strategic HR IT effort could greatly help the entire organization. Business leaders may have many questions such as:

  1. What business priorities and objectives are we aiming to support with the system?
  2. What is the best way to implement the system and use it to meet business needs?
  3. How can we maximize our investment?
  4. What steps will ensure widespread adoption of the solution by employees?

A firm understanding of the driving forces behind your organization’s HR transformation and targeted use of a talent strategy, a core HR strategy, or a transform strategy can help bring clarity and focus to the deployment effort. Before we jump into the comparisons, please note that there are 10 initial steps in the process to select a HR Software for your organization.

  1. Put together a Enterprise HR System Strategy. I will write about this is a future post.
  2. First, hire a good leader who will not only help shepherd the process but who can make crucial decisions in making this journey a pleasant one for you. This person’s influence can very well put you on the road to success. I have shepherded this process several times and I cannot emphasize how important this step is.
  3. The next step in the process is to identify the current processes in your organization. I am a big proponent of maintaining a Business Process Master List.
  4. After you have identified the processes, start writing down the requirements in each of major areas. For example: you could identify all the requirements in Personnel Administration or Organizational management or Compensation management, etc. You could have your subject matter experts write this from scratch if it’s not readily available or buy a list from the internet (one company I know sells a list of over 3,000 HR requirements), etc.
  5. Identify what is a standard industry practise vs what provides an competitive advantage. This step is important as it allows you to know later on what you can trade-off as no one software can address all of your requirements perfectly.
  6. Next identify the technical requirements. Do you need API’s so that the software can integrate with other systems you have? Do you need the system to be a cloud software? Does it support multiple countries (currencies for example) and multiple languages? How does it handle extensibility?
  7. These requirements are a starting point so you can compare apples to apples.
  8. Develop demonstration scripts so that you can ask the vendors to come onsite and show how their software will address the processes that are critical and provide a competitive advantage for your organization.
  9. Include other requirements such as vendor background, reference checks, etc.
  10. Compile this list into a repository and agree upon a scale to rate vendors. I know some companies that have a cloud solution so that you can do this electronically. That would work, or a simple excel file will also work, just choose something you are comfortable (based on how many individuals will be involved in the selection process) with and follow a process.

With above steps, you have prepared a bare minimum foundation for selecting a software to address your HR needs. Remember that the time spent in the selection process on upcoming roadmaps, service models, and vendor support is as important as time spent on feature and functionality checklists. With a new technology purchase, an organization is buying more than just a new piece of software, it is also purchasing that vendor’s future possibilities.

Base your final selection on in-depth use cases, customer testimonials and a clear understanding of what “hides under the covers” of the offering. You also should have a good grasp of the product roadmap and the vendor’s viability. Remember to do your homework and due diligence, bearing in mind your organization’s overall choices and constraints.  .

Let’s take a look at the differences between SAP SuccessFactors and Workday since they are the two of the most well-known human resource management (HCM) software. Each is a HR technology that brings a higher level of functionality and insight to the human resource department, helping with anything from applicant tracking, talent acquisition, compensation management, employee and manager self-service tools and more.

Two major selection criteria (pricing and implementation cost/time) will will not be discussed in detail here because both vary by customer. From an overall Commercial Flexibility, SuccessFactors is the winner because of the following reasons.

  1. SAP’s SuccessFactors solution is typically lower from an overall subscription fee. SAP will also provide deep discounting to win your business. Workday does not discount and treats all organizations the same (regardless of the size).
  2. SuccessFactors is usually willing to put in place long term price protections that minimizes the opportunity for cost increases during subsequent renewal terms. Workday has also shown a willingness to put price protections in place, however, achieving these protections typically takes significant back and forth effort with the results often not as good as those achieved with SAP.
  3. SAP shows a willingness to negotiate and improve their standard service level credit structure both in terms of credit percentage and ability to terminate for service level non-conformance. Workday does not negotiate or modify their service levels or service level credit structure.


Capabilities

SAP SuccessFactors

SAP SuccessFactors provides HR and workplace analytics solutions in five distinct segments — Core HR, Talent Management Software, Analytics, Social Collaboration, and Small Business Solutions.

  • The Core HR element (Employee Central) provides a central resource for employee control and now delivers 71 country localizations. SuccessFactors Employee Central Payroll includes a hosted instance of SAP Payroll. Global benefits administration functionality is available, while U.S. benefits administration is provided through partners (such as Benefitfocus). Health and safety tracking (but not grievance, we created a custom object in one of my projects) is delivered with Employee Central. Basic digital HR document management is supported by enabling various attachment types within process workflows.
  • The Talent Solutions module helps provide dashboards for things like recruitment, on-boarding and incentives, with the key goal of helping to hire and retain talented people. It is composed of natively developed solutions from SuccessFactors (i.e., performance and goal management, compensation, succession and career development, and recruiting management), as well as solutions that were acquired and subsequently enhanced: Plateau (learning management system [LMS]), Jobs2Web (recruiting marketing), Inform (workforce analytics and workforce planning), KMS (forms engine, primarily for use in onboarding), CubeTree and Jambok (social collaboration). SuccessFactors continues to develop these acquired solutions: Jambok and CubeTree were combined and enhanced to create SAP JAM; and the KMS forms engine was combined with additional development to deliver Onboarding.
  • Leave and absence management, as well as core timesheet functionality, is supported within Employee Central, with broader WFM capabilities delivered through partners (such as Kronos or Workforce Software).
  • SAP’s Social Collaboration component involves SAP Jam enhances collaboration between people within a company.
  • Natively developed Help Desk capabilities were introduced in 2014 via the Employee Central Service Center and the addition of “AskHR” links on each page to facilitate knowledge search and service center ticket creation.
  • Employee Central provides HR localization support for 71+ countries and translated in 39+ languages, with additional localizations and translations planned. SAP SuccessFactors operates two data centers in the U.S., three in EMEA and two in the APAC region.
  • SAP SuccessFactors began as a natively developed talent management suite for performance management. Career development, succession planning, compensation, recruiting and core HR were added later. Via multiple acquisitions, the vendor then added Plateau to the suite for learning management (2011), as well as CubeTree for social/collaboration (2010), Inform for workforce analytics (2010), Jobs2web for social posting/recruiting marketing (2011), KMS for onboarding (2013) and Fieldglass for contingent labor management (2014).
  • SAP SuccessFactors uses Machine learning that elevates HR’s role from tactical processes to strategic business partner. Intelligent software is enabling the mechanics of workforce management like creating job requisitions, recommending courses, or predicting which employees are likeliest to leave the company.
  • SAP SuccessFactors offers two options to customers considering deployment of extended functionality. The first is the Meta Data Framework (MDF), a configure-to-extend development environment that enables customers or SI partners to build complete sub-applications with no coding within the Web administration tools to define and extend objects, create rules and define user experiences. The second is the Hana Cloud Platform (HCP), a complete code-to-extend PaaS designed to handle more-complex integrations and functional requirements. Since MDF and HCP are natively integrated, users can reduce development and support efforts by building core objects in MDF, then leveraging them in HCP.
  • SAP SuccessFactors delivers standard/operational and ad hoc reporting via its Online Report Designer, delivered dashboards use the Tile-Based Dashboard Framework, with some configurability options. The Analytics component provides workforce planning tools that help decision makers work on long-term planning. SAP SuccessFactors is planning to include a new analytics user experience, transition to the Hana platform to increase reporting process throughput and the delivery of additional predictive analytics.
  • EC deployments range across multiple industries, with slightly more adoption in manufacturing, professional/consulting services, communications/media and business services (together comprising an estimated 43% of the customer base). Approximately 46% of customers have 1,000 employees or more, and 14% have more than 10,000 employees.

 

Workday

The Workday finance and HR software suite helps planners to stay on top of both people and finances.

  • Global HR functionality is enabled through delivery or configuration of the fields necessary to support statutory reporting in individual countries. Payroll is provided for the U.S., Canada, France and the U.K.. Workday has not announced plans for the development of any additional payroll localizations. Instead, it is focusing on partner integrations and payroll interface technologies to satisfy additional country requirements. Gartner estimates that approximately 55% of Workday clients use U.S. or Canadian payroll. Benefits administration is delivered as part of core HR, and Cloud Connect for Benefits delivers prepackaged connections to third-party providers. Health and safety tracking is supported; however, grievance tracking is not. Basic digital HR document management is supported through attaching various document types to the core worker record. Expense Management, fully integrated with the suite, is also available as an optional module for HCM customers.
  • Workday delivers functionality to support performance management, succession planning, compensation management, workforce planning, recruiting and onboarding. Functionality across performance, succession and compensation is generally of average competitiveness. Recruiting is still relatively new (launched in May 2014), with capability gaps compared with the broad and deep offerings of the more-established recruiting suite solutions (such as Oracle Taleo or IBM Kenexa). An LMS is not offered; however, Workday partners with several LMS vendors (such as Cornerstone OnDemand and Saba) to deliver standard integration with Workday HCM. A new Talent Insight offering released in April 2015 delivers data science and machine-learning capabilities (acquired in its 2014 purchase of Identified) to deliver predictive and prescriptive recommendations into key talent work streams.
  • Workday delivers absence management through its core HR solution and offers a separate module for time tracking. The time-tracking solution is designed for organizations to collect, process and distribute time data to manage time and labor for their global workforces. Workday clients with more-complex requirements in this area (including industry-specific needs, such as complex work rules and scheduling optimization) will typically turn to third-party solutions. Gartner estimates that approximately 40% of Workday HCM clients use Workday Time Tracking.
  • Extensive self-service for managers and employees is enabled via role-based views of the system. Workday delivers native mobile support for iPhone, iPad and Android mobile devices, as well as responsive Web design via HTML5. HR Help Desk for shared-service centers is provided through partners integrating with the Workday functionality.
  • Workday provides translations of employee and manager self-service transactions in 24 languages. It operates multiple data centers in North America and has two data centers in Europe (Ireland and The Netherlands).
  • Workday was brought to market in late 2006 on the premise that a natively developed suite of HCM functionality on a multitenant SaaS platform would optimize the customer experience and increase the pace of innovation. Workday has made several acquisitions of underlying technology components to improve scalability, integration and information management, including the Cape Clear integration engine (2010) and Identified (2014) for search and predictive analytics.
  • Workday enables customers to create custom fields and attributes for 33 application objects (such as Worker, Job Profile, Location, Pre-Hire and Region). Once created, custom fields can be included in business processes and reporting, and are not affected by application updates.
  • Workday provides standard/operational reporting and configurable, role-based dashboards (accessible via mobile, as well as browser) as an embedded capability of its application. It provides visual dashboards that are easily formed into chart and graph views to show details about management chains, team histories and more.
  • Workday customers come from a broad cross-section of industries; however, professional/consulting services, education, business services, insurance and manufacturing are the primary verticals, with an estimated 63% of the customer base. Gartner estimates that 85% of Workday customers have more than 1,000 employees, and 26% have more than 10,000.

 

Please find below the capabilities comparison checklist and end users ratings for these two solutions.

Figure 1: Capabilities Comparison Checklist

CAPABILITIES SUCCESSFACTORS WORKDAY 
Applicant Tracking Yes Yes
Applications Management Yes Yes
Benefits Management Yes (Integration with Benefits Focus for US) Yes
Career Development Yes Yes
Career Development Planning Yes Yes
Collaboration Tools Yes (SAP Jam) Yes (Integration with MS Office 365 Groups)
Compensation Management Yes Yes
Competency Management Yes Yes
Compliance Management Yes Yes
Customizable Reporting Yes Yes
Employee Onboarding Yes Yes
Goal Management Yes Yes
Goal Setting / Tracking Yes Yes
Job Application Management Yes Yes
Job Management Yes Yes
Learning Management Yes Yes
Payroll Management Yes (EC Payroll) Yes
Performance Appraisal Yes No
Performance Management Yes Yes
Performance Review Cycles Yes Yes
Real Time Analytics Yes Yes
Real Time Data Yes Yes
Recruiting Management Yes Yes
Succession Management Yes Yes
Succession Planning Yes Yes
Time & Attendance Tracking Yes (Integration with Kronos) Yes
Training Management No Yes

 

Figure 2: Vendor Benefits and Challenges Survey
(Source: Sierra-Cedar HR Systems Survey White Paper 2016-2017)

 


Comparisons

SuccessFactors

Pros

  • All-in-one app: SuccessFactors offers collaboration functionality that eliminates the need to export spreadsheets or Word documents. It allows users to do all tasks and view reports on the app.
  • Greater functionality: For example, Compensation Planning module is a differentiating factor of the software, especially Executive Review as it isn’t offered by other vendors.
  • Ease of Use: For example, Review process makes the goals and reviews process more natural.
  • Mobile Features: Offers apps for iPhone, iPad and Android mobile devices, giving users the flexibility of using the solution any time from anywhere.
  • Extensibility: SuccessFactors has Metadata Framework-based extensibility approach (especially in Employee Central) that addresses any requirements that are not met out of box.
  • Innovations: With Intelligent Services, Continuous Performance Management, Chatbots for answering common HR questions, and Artificial Intelligence in the areas of Recruiting and flagging discriminatory language in job descriptions, SAP is committed to innovating at a rapid pace (SAP has the financial and technological power to build out its solutions to be the best in the world. I remember how when SAP initially came out with their BW solution, it was very bad and very late to the party but in about 4 years it overtook all other solutions out there and was considered the best in class).

Cons

  • Integration: Developed Employee Central on its own technology stack; however other SF modules are also on different technologies which means a customer running the whole suite will have different code bases and versions. Employee Central Payroll is really SAP Payroll on cloud. Parts of the solution have a different look and feel, different workflows, a different data model although SAP is making a firm commitment to creating a new single unified platform for every app it owns (I see more and more screens being converted to Fiori with every release).
  • Customer support: Various users point out that the support portal was difficult to use and the response time is long. SAP did address this by bringing all support related topics into a single portal.
  • Poor implementation: The system needs to be built manually (which was time intensive). SAP needs to improve the transport system and make it more robust.
  • Requires better UI: SAP is converting their screens to Fiori, but it’s currently not there yet.

 

Workday

Pros

  • Cloud first: Native cloud vendor with a great offering, business culture and service quality. Workday has been able to develop a product based on next-generation technology, such as object and in-memory, with a consumer-grade user experience, including mobile, second to none; robust functionality; and covering most HR domains.
  • Short learning curve: Offers greater flexibility than other tools and is easy to navigate without instructions because of the simple overall layout.
  • Easy to implement: Easy to use by employees, managers and HR but is also capable of handling large volumes of transactions or data
  • Added functionality: Workday also provides professional service automation and financial accounting as added offerings.

Cons

  • Functionality: Workday has yet to reach functional parity with SuccessFactors in the talent space.
  • Limited integrations: Workday does not integrate with ATS, Jobvite, etc. This adds costs in order to hire IT experts for implementation.
  • May be costlier: Workday is relatively expensive and uses a ticketing customer service model, which means that issue resolution time is high.
  • Not really an ATS: New buyers may have to create many custom processes for routine processes.
  • Learning and Payroll are work in progress. Not really there as a robust solution. Payroll especially is lacking multi-country solution.
  • Workday’s custom objects is a move in the right direction, but it has its limitations: There are only so many custom objects you can have, you cannot use them where you see fit and cannot pull them up necessarily where needed.
  • Reporting limitations:  It is limited to 10,000 entries and for large companies this might be an issue.
  • Security:  The pervasive security is generally very good but it isn’t carried through effectively when looking at talent or succession pools. Also, you need to create a workaround to prevent HR people being able to see their own data.


Conclusion
While there is no one easy answer to the question, it does not have to very hard to select a system. I have helped several organizations make the right selection for their circumstances and I would be glad to help you with yours. If your company already uses SAP, it makes sense to consider SuccessFactors, otherwise Workday should also be considered along with other products. Follow some recommendations as below:

  1. The critical piece of the puzzle is to hire the right people who have done this before and understand not only HR systems but also how to navigate through the organizational policies, procedures and processes and determine how to modernize and transition them to the new system.
  2. Establish a priority order for HR functionality (based on the business outcomes defined in the Enterprise HR System Strategy mentioned in introduction section) to drive proper evaluation of these solutions. You must determine which capabilities are the most crucial to your success, and what applications will deliver them.
  3. Ask deeper, more-detailed questions during the RFP, demo and contracting phases to find the best-fit solution. Gather the same response set from all vendors in the initial RFP. Tailor the Technical review, architecture review and integration deep dive sessions so that you can understand how each vendor’s approach might affect how their applications are implemented, deployed and managed in your environment.
  4. Structured reference checks with similar customers are key to understanding what it’s really like to work with the product and vendor. Solicit at least three references from the vendor to get a balanced picture of each finalist vendor’s strengths, trade-offs and implications.
  5. Be prepared for the fact that deploying any of these solutions is likely to be a major change in how your core HR will be managed, see my post on Mapping Business Process and improving them.



References
Software Requirements List
SAP SuccessFactors announces two big wins
Sierra Cedar 2016–2017 HR Systems Survey Results
3 keys to negotiating successful cloud agreements
SAP SuccessFactors vs. Workday vs. Google?!?
The Absolute Latest from Workday – August 15, 2017


Please feel free to reach out to me for any decisions that you might need guidance on with regards to SuccessFactors, S/4 HANA, SAP Leonardo. I am happy to pay it forward. This post would not have been possible without all the help from blogs in SAP community and other articles published by SAP. Please connect with me at https://www.linkedin.com/in/krismoturi so that you can get notified if topics like SuccessFactors and S/4 HANA interest you.