Raising The Bar in Human Capital Management Software

SuccessFactors wants to turn its on-demand human capital management (HCM)
tool into a strategic application.

Typically, HCM applications are used by human resources departments and,
perhaps once a year, by all employees during annual review periods. But
SuccessFactors is adding new features that will make the tool more
applicable to everyday functions throughout the enterprise.

The new features can be used by employees to track their own performance,
take after colleagues whose career tracks they want to emulate and identify
mentors within their organizations. It can also be used by companies to
gather aggregated data about their personnel to help make better hiring
decisions, and to see whether individual goals are tracking with
organizational goals.

One new feature the company is announcing today allows employees to locate
themselves within the context of their organization and identify peers and
executives higher up the organizational chart. Clicking on any other name
reveals that person’s competencies so that employees can identify competency
gaps that they need to fill in order to get promoted.

The profiles also include links to Skype, Yahoo instant messenger and may
contain other personal information that individual users can add at their
own discretion.

Users can also tag their profiles with keywords associated with a particular
area of expertise or personal interest, making it easier for employees to
identify subject-matter experts or like-minded colleagues within their
organizations.

A separate feature allows executives to view a dashboard of competencies
which they can use to make better recruiting decisions by showing them which
attributes have led to better overall performance in each job category.

SuccessFactors, based in San Mateo, Calif., also introduced a feature called
“Coach TV” which shows employees tips for improving their performance, based
on gaps in their most recent reviews.

These features are in addition to standard HR modules, including performance
management, compensation management, succession management and learning and
development.

Rob Bernshteyn, vice president of product marketing at SuccessFactors, said
the goal of the new features is to turn the application into more of a daily
routine for every employee in the company.

“Every employee is a potential user of our application,” he told
internetnews.com.

SuccessFactors competes in this space with compensation management
application vendor xActly, performance review software vendor Halogen
Software and on-demand ERP vendor Workday,
among others.

Yankee Group analyst Jason Corsello said that legacy HR applications
typically touch just 10 percent of enterprise users.

“[SuccessFactors] represents a dramatic shift in enterprise applications,”
he told internetnews.com. “They’re able to get a 360-degree view of the employee.”

In contrast to most other SaaS  vendors, SuccessFactors charges on an annual
rather than monthly basis. Bernshteyn said that, depending on the number of
modules purchased, customers are charged between $50 and $100 per user per
year.

Corsello estimated that SuccessFactors charges approximately $4 per month
per user, compared to the $60 per user per month on average charged by SaaS
industry benchmark Salesforce.com .

“It isn’t entirely clear what the market has decided is the right price for
every user on this model, but $4 per month is clearly more digestible than
$60,” he said.

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