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Summary
This article seeks to provide guidance on deciding the most suitable target application architecture to support Personnel Administration (PA) and Organization Management (OM) needs of an organization in the Business Domain of Human Resources.
With SAP SuccessFactors and SAP S/4HANA both delivering solution capabilities around Personnel Administration and Organization Management, enterprises now have multiple applications to choose from and need to make their selection by comparing their organization’s business capability requirements to the solution capabilities SAP applications offer.
Licensing aspects of the solution components discussed should be considered during target architecture design and is beyond the scope of this evaluation.
Business Requirements
Typical variety of business capabilities constituting Personnel Administration and Organization Management can be seen in the illustration below:
Solution Options
Typical deployment choices for Personnel Administration and Organization Management are the following:
- SAP SuccessFactors Employee Central is SAP’s strategic Public Cloud Core HR solution operated as Software as a Service (SaaS). It includes the newest and future proof innovations for workforce management with a powerful HR information system and extensive self-service and workflow capabilities.
- HCM PA/OM in SAP S/4HANA Private Cloud or RISE is the successor of HCM in SAP ERP 6 with all advantages of a private cloud environment and the flexibility and extensibility known from the classical HCM solution. It can either be run in an integrated ERP scenario together with Finance and Logistics or separated in a standalone HCM scenario.
- Further option is to keep the existing SAP ERP 6 (not lower than EhP6) until 2027 (with mainstream maintenance) or 2030 (with extended maintenance option at additional cost), then upgrade to SAP S/4HANA Release 2023 or higher and active business function for HCM for S/4HANA (H4S4).
Criteria to determine the most suitable Target Solution
The following questions are seen to be crucial to determine the most suitable target solution and to define the course:
- Do you want to keep your existing HCM solution by SAP for longer?
- Do you have any policies or regulations preventing you from using a public cloud solution?
- Do you require fast innovation?
- Do you require a high degree of process customization?
- Do you need to separate your HCM from the transactional ERP?
Decision Tree
Conclusion
- SAP SuccessFactors solution is proven to be the best choice in case you need to adopt SAP HCM innovation at maximum speed.
- Deployment choice SAP S/4HANA Private Cloud Edition or RISE Edition offers the highest degree of flexibility with highly complex and customized process flows. In addition, it is the alternative for Public Cloud solutions, if there are regulations or policies in your organization preventing to store employee data in public cloud solutions.
- Depending on corporate policies and business requirements SAP S/4HANA Private Cloud or RISE can either co-host HCM functionality in the integrated S/4HANA scenario or a standalone HCM instance, as required.
- ERP version 6 is guaranteed to be under extended maintenance for HCM solutions through 2030 after which you must migrate to one of the options listed above. Most commonly, transition from ERP HCM to HCM for S/4HANA is being conducted by a system conversion (known as "Brownfield" transition approach)
Look out to similar decision accelerators in other HR scenarios (e.g., Payroll, Talent Management etc.) in the adjacent articles in this community.
Should you need subject matter expertise from SAP with regards to this or other architecture decisions, please feel free to ask your Technical Quality Manager or your Account Executive at SAP.
