Why HCM Digitalization Matters To Midsize Businesses

Lara Albert and Frans Smolders

Midsize companies have talent challenges that are similar to their larger competitors – but they don’t have the time, people, and resources to address them as quickly. Yet, as the workforce grows and becomes more dispersed, traditional reliance on disconnected systems of applications, siloed data, spreadsheets, and clunky manual processes is testing the ability of HR organizations to keep up.

Something has to change. But this doesn’t mean that every growing company is ready to invest in cloud-based human capital management (HCM) solutions right now. Unfortunately, many of them still need to address internal concerns on whether any update to their HR processes – digital and otherwise – is sustainable enough to scale to growth and deliver long-term advantages.

To pull back the curtain and reveal the tangible value of HCM in the cloud, Forrester Research recently conducted a rigorous and objective total economic impact study of midsize businesses experienced with various HR solutions.

Build up HR capabilities for business growth with HCM in the cloud

Based on in-depth interviews and financial analysis of existing customers, Forrester revealed that midsize companies using SAP SuccessFactors HCM Suite experienced an ROI ranging between 42% and 113% within 21 months or less. This outcome is achieved across four major HR solution areas: core HR and payroll; recruiting and onboarding; performance, goals, and compensation; and learning, succession, and development.

Total Benefits Achieved Across Major HR Solutions

total benefits achieved across major HR solutions with SAP SuccessFactors HCM Suite

Source: The Total Economic Impact of SAP SuccessFactors HCM Suite for Medium-Sized Businesses,” Forrester Research, sponsored by SAP, 2019.

 1. Core HR and payroll

Survey participants indicated savings of time and effort to handle core HR and payroll activities when compared to past practices. For example, managers and employees can access intuitive self-services that are compliant with data-privacy mandates, such as the European Union’s General Data Protection Regulation (GDPR).

These core HR and payroll capabilities in the cloud allow the workforce to take ownership of basic and strategic day-to-day tasks by tapping into increasingly efficient transactional services, a mobile-first approach, and a single source of truth enabled by real-time data. Meanwhile, the HR organization can emerge as a strategic partner that can help ensure business growth with a centralized focus on delivering solutions that increase employee engagement and ease work experiences.

2. Recruiting and onboarding

For recruiters and hiring managers, the implementation of cloud-based HCM presents an opportunity to source, engage, and hire top talent faster when compared to manual, nonintegrated processes.

Study participants noted the flexibility to post jobs internally and externally to preferred recruitment agencies and job boards, apply Boolean database searches to internal candidate databases, and differentiate candidate sources with efficient coding. With intelligent guidance, they are also improving two-way communication with candidates through automatic emails. Plus, the collection of signed contracts and employee information is streamlined with a compliant pre-onboarding platform.

3. Performance, goals, and compensation

Instead of being overburdened with highly manual practices such as using and exchanging spreadsheet files, surveyed midsize companies demonstrated greater alignment of compensation and appraisals.

Each employee is matched appropriately to cascading business and organizational goals. This capability helps ensure continuous improvement of workforce performance with ongoing coaching and feedback to accurately evaluate, recognize, and reward top talent.

4. Learning, succession, and development

The opportunity to provide employees with personalized learning plans structured around their assignment profiles, strategic succession planning, and existing skills-development needs is attracting and retaining qualified individuals while supporting business growth.

According to interviewed participants, employees can learn about new products and regulations on their terms, anytime and anywhere. HR organizations are filling critical positions quickly by identifying and retaining valuable employees and promoting leadership continuity without bias. Furthermore, training programs are auditable because certifications are automatically tracked, and electronic signatures and exam versioning are captured for regulatory and compliance purposes.

Explore the future of HR for your business

The Forrester total economic impact study for midsize businesses is an exciting opportunity to understand the value of cloud-based human capital management solutions with confidence. Read the report to learn how your growing business can benefit.


Lara Albert

About Lara Albert

Lara Albert is passionate about building world-class brands, launching breakthrough products, and creating effective global marketing strategies for high tech companies. Lara is currently responsible for the go-to-market strategy and execution of SAP HCM Solutions, with day-to-day responsibilities for Talent Management solutions, which includes Onboarding, Recruiting, Learning, Performance & Goals, Compensation, Succession & Development, and Workforce Planning.

Frans Smolders

About Frans Smolders

Frans Smolders is a HR software fanatic and passionate about helping organizations to improve their business. He started his career in HCM consulting, and throughout his career served in product management, sales, and marketing. Currently Solution Management responsible for SAP SuccessFactors Core HR solutions, including Payroll, Time Management, Benefits, HR Helpdesk, and partner solutions.