After a turbulent year in which people management issues repeatedly made headlines, the message is clear for organizations that are forced to reimagine their business for the future. For a healthy, skilled workforce and an agile business, it is time to rethink how we manage and develop people.

“Companies are transforming,” says Josh Bersin, a global analyst with deep experience helping organizations implement human capital management (HCM) systems to bring strategic value and success to their performance. The Josh Bersin Company’s research shows that there is a shift underway as companies attempt to cross over industries to tap into new markets.

“HCM has to fulfill and support this transformation in the company. These days you cannot run a company effectively without a strategic HCM system,” says Kathi Enderes, senior vice president of Research at The Josh Bersin Company and lead analyst for the study. She cites the evolving requirements at companies to support hybrid work, gig and contract workers, internal talent mobility, sourcing and assessing job candidates, and reskilling employees. “The big change is that we have to design HCM systems with and for employees, not just for HR.”

For most organizations, that requires implementing a cloud-based solution for HCM that integrates with other strategic systems, such as cloud enterprise resource planning (ERP), to deliver an improved employee experience, while also providing better data and insights in real time.

HCM: A Transformative Journey

A surprising number of companies, however, struggle to achieve the expected value from their cloud HCM projects. Nearly two-thirds of respondents said that they only partially achieved the business case at the center of their HCM project, according to a recent webinar poll by The Josh Bersin Company. The lackluster outcomes identified by these respondents are in line with analyses by Bersin’s team, which set out to understand why some HCM projects fall short on value achieved in comparison to value expected and identify key lessons learned from successful transformations.

Implementing a cloud-based HCM system is often a “multiyear, complex, cross-functional project,” according to Enderes. HR leaders are advised to prepare their organizations for a transformative journey. “You have to think of an HCM project as a business transformation,” she says. “It is not a technology implementation because no matter how you look at it, you’re going to be changing the way people work, changing what managers do, and changing the role of some people in HR. All of that is an opportunity to make your company operate better.”

Resources for HCM Excellence

Demystifying HCM Transformations: 6 Steps to Success, available for viewing on demand, is the third in a series of solution-focused webinars organized by Tata Consultancy Services to support companies during their HCM journeys. In the webinar, Josh Bersin, Enderes, and Bill Pelster deliver key insights and lessons learned based on their interviews with organizations that are running SAP SuccessFactors solutions.

Joining them are Ram Subramanian, global head of the Human Capital Practice at Tata Consultancy Services as well as a collaborator on this research, and Rajamma Krishnamurthy, senior director of MS Digital Employee Experience at Microsoft. They share their HCM experiences during an engaging panel discussion about best practices for project preparation and change management. The three keys that matter most for a successful HCM project are identified in the research and explained in the conversation: improving the employee experience, powering HR transformation, and enabling people analytics and talent intelligence.

Also available is Best Practices for HCM Excellence: SAP SuccessFactors Edition, an in-depth research guide for download from The Josh Bersin Company in collaboration with Tata Consultancy Services. It provides an overview of SAP SuccessFactors, the human experience management (HXM) suite, and a deep dive into six key lessons from successful SAP SuccessFactors transformations, based on stories from companies in various industries around the globe. The accompanying deep-dive case studies from Microsoft and Allianz provide valuable organizational perspectives on how to maximize outcomes from SAP SuccessFactors projects to power business transformation and enable a much improved employee experience.

Building a Future-Ready Workforce with SAP SuccessFactors

In the first half of 2022, SAP SuccessFactors launched 825 new go-lives. With more than 9,400 customers and over 220 million users worldwide, it is the most widely used cloud HCM platform in the world. SAP SuccessFactors serves customers across a broad mix of organization sizes, industries, and geographies.

“SAP in particular — because the company is a big user of HCM systems and is a very complex, multifaceted, multidomain company — understands the complexity of a larger organization,” says Bersin. “SAP SuccessFactors over the years has advanced this technology, integrated with the back-office of SAP, and just introduced what I believe is probably the most significant release they’ve ever done.”

The strategic innovations introduced in SAP SuccessFactors second half 2022 release, now available to customers, give companies greater agility to meet the ever-changing demands of business. These foundational developments include skills ontology, growth portfolio, and dynamic teams to help organizations upskill, reskill, and redeploy employees to roles that match their interests and capabilities, as well as advancements to offer a more individualized experience to employees. For more information, watch the second half 2022 release highlights video.

As Bersin notes, “Over the years, SAP SuccessFactors has been redesigned to be a single point of contact for employees. That’s what really every company wants.”