Cornerstone, the newest kid on the global HRIS block

RIO DE JANEIRO

Entering the global HRIS fray

In August 2015 I wrote a post predicting that Cornerstone would have no choice but enter the global HRIS space with a core HR (or HR Admin) offering which I called Cornerstone HR. A couple of months later, at its annual event the company did indeed announce such an offering, calling it Link (here's the post)

A couple of weeks ago, at the annual event held in London, Cornerstone announced a more beefed up version of Link which it now calls ...Cornerstone HR! Since I have the prior claim on the brand name, I facetiously asked CEO Adam Miller for copyright royalties, which drew laughter from the analyst audience gathered at the Hilton Metropole.

So, it is now clear that there is a new player in the game, rattling the global HRIS apple cart. Cornerstone will now start receiving more HRIS RFPs (vs pure learning or talent based ones) and you can expect an increasing number of companies, especially from its installed base to acquire Cornerstone HR. It is more likely that initially there will be more Cornerstone customers, especially those who have never had a global HRIS system in place, that will move up the value chain with Cornerstone HR. But I also expect  net new customers to go down the same road sooner rather than later.

However, for Cornerstone to live up to expectations, reach functional parity with its major competitors and make a success of this new strategy it needs to:

• Have a strong product management team that understands global HR admin requirements 
• Rewrite some parts of the underlying data model to move to a person model rather than a user one
• Beef up substantially several parts of the offering where it lags behind its competitors (see examples in the below graph).
• Include unique differentiators, maybe on budgeting and planning or around the integration with learning
  
              

 A global HRIS star is born ...

but still needs to complete its homework

With this homework done (not an easy feat - just look how long SuccessFactors struggled with Employee Central and it's still WIP), the three global HRIS musketeers will now become four, a development I always felt the market needed. And, remember, in the Alexandre Dumas novel, the three musketeers were actually four. Can you name them? (Don't cheat - I'm providing you with the names below)*

A big question, which corporate buyers may want to ponder, though, is: will this development stabilize Cornerstone as the second independent, pure HR vendor (after Workday)? Or will it make it even more attractive to predators? Rumors have been swirling around that an acquirer was in the wings, ready to pounce. Let's hope that the fourth musketeer remains independent for the benefits of the HR community and the spirit of healthy competition.

Merry Christmas and a Happy New Year to all!

(The blogger is having a tropical Christmas this year before heading back to the Northern Hemisphere)

NOTE: Data in this post are the intellectual property of Ahmed Limam and cannot be reproduced without prior written consent

*Porthos, Athos, Aramis and, of course, D'Artagnan.

Viadeo's demise: Chronicle of a death foretold

LONDON

In a  recent op-ed on the current French president's disastrous term and abysmal approval ratings (4%, if you can believe it), the New York Times refers to the hapless François Hollande as the living dead: who continues to be politically alive although he has actually died. The same can be said of another French institution, this time in the technology space: business social media Viadeo which had aimed at revolutionizing many aspects of HR.

For most global users of professional social media, there seems to be only one name: LinkedIn (although Facebook is bound to become a formidable competitor as it announced this week it was entering the job postings business.) But in many countries there are local players that cater to the requirements of a niche market. Xing is popular in German-speaking countries, Weibo in China and, for a while, French-based Viadeo looked promising. Unfortunately for  the latter, who was created in 2005, the same year as Workday, its trajectory has been the exact opposite of the HR-cum-finance SaaS vendor: whereas the Pleasanton-based company has gone from strength to strength,  the Paris-based company has seen its prospects get dimmer and dimmer, especially in the past few years to the point that last week it requested to be de-listed in an attempt to stop its stock price's free fall.

Sad as it may be, this has come to no surprise to me. For quite a while now I have been advising investors to stay clear of this stock. Several of those who followed my advice sent me last week email messages telling me my advisory fee was money well spent, while others may rue the day they decided to take the risk.

So, what went wrong with Viadeo? Why couldn't it follow in the footsteps of highly successful French unicorns such as Criteo (Disclosure: a former HRIS client) and Blablacar? The reason can be found in several mistakes Viadeo made.

First, it never managed to provide the depth of functionality that LinkedIn does. Viadeo was for a while not more than an online Rolodex  with basic messaging and job features. And it had the gall to try and charge you when LinkedIn would get you like-for-like features for free.

Second and worse, although the two  companies were established within a couple of years from each other, Viadeo thought LinkedIn would remain US-centric and that Viadeo could be its European version and even compete globally. Unfortunately most initial Viadeo users, including yours truly, quickly realized that the same people who were on Viadeo were also on LinkedIn. So why duplicate the effort?  A choice had to be made. If you work in international settings many of your contacts will be  on LinkedIn only, That simple observation signed the death knell for Viadeo in my opinion. I left it and never looked back.

The giant and the dwarf

Early this year I conducted a workshop for the localization of a global HRIS with a client based in France and when discussing employee records and associated data, somebody mentioned Viadeo as a social media that maybe should be tracked because many employees are typically French and use it to the exclusion of others. However, they couldn't give me an exact figure on how many users were exclusive Viadeo users. Knowing that most global HRIS vendors wouldn't have Viadeo as part of their standard offering I was reluctant to include it. But, at the same time, I didn't want to ignore what could be a legitimate request. So, I took a quick poll around the room. The 35 people in the workshop were all French, based in France, belonged to the various group entities. "How many have a Viadeo account?", I asked. Only two raised their hands,and one then added, 'But I haven't updated mine in years." "How many have a LinkedIn account?" All raised their hands. That sealed the fate of having Viadeo in the French localization of the global HRIS project.

Third, LinkedIn became global so much faster and signed up so many users that Viadeo soon faced the network issue that any competitor of a social media is well aware of: if everybody is on LinkedIn, why bother  about Viadeo?

Tongue tied

Viadeo could then have positioned itself with brilliant functionality (which it doesn't have - I did an in-depth analysis for my investor clients: it can at best be described as adequate). And God knows that the heavy user of LinkedIn I am (especially in the HR Technology Group discussions) can point to many shortcomings of LinkedIn that Viadeo could have capitalized on by bringing better features. But it seems that Viadeo has no sense of what competitive intelligence is.

Viadeo could then have tried to expand in some large markets outside the US to become a credible alternative to LinkedIn. Here again, total failure. To mention just two BRICS countries, it had to pull out of China ignominiously and, as for Brazil, its branding was a total disaster. Couldn't all the money they raised from investors be used on some marketing studies that would have told them that Viadeo sounds in Brazilian Portuguese like the  local word for "faggot" and that few, if any, Brazilian professionals would boast of being on "Viado"?

The business model between the various professional social media is also revealing: LinkedIn relies more on advertising, whereas Viadeo has a complex subscription model. Now, who in their right mind would pay, even if a few dollars, for what can be found largely for free and better somewhere else?

In 2013, less than a decade after it was established, Viadeo was surpassed on its own turf by LinkedIn. Instead of being a wake-up call to its management, they continued with their usual mix of hubris, delusion and denial, dreaming that Viadeo could oppose the laws of gravity until Doomsday. Well, Doomsday has arrived.

Put all of this together and you quickly realize that investing funds in Viadeo was throwing good money after bad, and for a company or a professional user, a complete waste of time. One more technology company to go join My Space, Netscape, Orkut* and soon Yahoo in the cemetery of deluded, badly managed, acquired or failed software/internet companies.

Sic transit gloria mundi

*Just a few years ago, Orkut was all the rage in Brazil before everybody migrated to Facebook. Many people don't even remember it once existed

NOTE: Although the analysis in this post shares some of the findings presented to investor clients, it remains the intellectual property of Ahmed Limam and as such cannot be reproduced in any form without  his written permission)

(The blogger/consultant/advisor is currently attending Cornerstone Convergence 2016 in London)

Middle Kingdom: Musings on Chinese HR, technology and the country

SHANGHAI

The Oriental Pearl Tower  seen from the Bund.
As spectacular as un-Chinese since, unlike Muslim
minarets and Gothic cathedrals, Chinese palaces, pagodas
and pavilions have traditionally been low-rise affairs

Surprising as it may seem for the globe-trotter I am, until this week I had never set foot in China. Although I had worked on many global projects which involved rolling out an HR system for a Chinese workforce the opportunity never arose for me to visit the ancient land known to Marco Polo as Cathay* (the name is still used by one of the most successful airlines in the world, based out of Hong Kong.)

It was therefore with great trepidation that I boarded the world's largest aircraft, the Airbus A380, for the longest trip east that I had ever taken in order to spend most of the week in Shanghai with the local subsidiary of a multinational client. This was a unique opportunity to gather business requirements face to face with HR users in their local environment, something only imperfectly done in virtual meetings, on the phone or by email.

You soon realize that if in China rules and laws may not be voted on by a democratically elected parliament, but rather handed down by the omnipotent Communist Party, they are adhered to ferociously, as I was reminded when, during one of the workshops I led, I suggested we shorten the lunch break from one hour to 45 minutes. The reaction was a categorical NO. Labor laws are labor laws: one hour's break for lunch is one hour. Can't say I was shocked since that is exactly the same rule as in France (but outside the rest period, the Chinese workforce is a hard working one and I was impressed by the quality and dedication they bring to the task.) Actually, many other aspects of China's labor laws seem to be directly inspired from France's: such as the 1-2% of a company's payroll which must be set aside for the worker union to spend on employee benefits. But then French laws are at times very socialistic, if not outright Communist (ever wondered why the Labor Code in France is a little red book?)

Replica of Xi'an Terracotta Army
soldier, gifted to the blogger
by the Chinese delegation to the
UN World Tourism Organization where
he worked in the 1990s

A rapidly changing country
As everybody knows, China has managed to bring hundreds of millions of people into middle-class wealth faster than any other country on earth: in the past 25 years income per person has risen 13 times, whereas in the rest of the world the figure is barely 3 times. I see on Shanghai overcrowded roads more SUVs  than anywhere else but the US. Beijing has more billionaires than New York.  If there ever was a national success story it is China. And yet serious problems are looming: it is still an autocratic country, unemployment is rising, especially in the poorer rural areas in the country's western half, inflation is high (Shanghai home prices rose by 20% last year), the population is greying fast as a result of the one-child policy aiming at reining in demographic pressure, pollution shows its ugly face in many places with foul air a constant irritant. Some un-Chinese traits such as individualism and Western-style consumerism are on the rise in this increasingly unequal People's Republic. (I always marvel at Chinese tourists who buy designer bags at Paris upscale department stores for a price that is higher than many workers back home make in a year)

Now, to the topic at hand, requirements to manage a Chinese workforce as part of a global HRIS. In some aspects HR law and  practice in China may be complex, even cumbersome (but is there a place  where that is not the case?) However, in many other aspects it is quite simple and even free-market based, reminiscent of the practice in the (income-tax free) Persian Gulf states. For instance, in Europe and America, there is a quite clear-cut distinction between permanent employees and contractors, HR processes apply fully to the first, not to the second. In China, there are no contractors: everybody is a permanent employee. There are also no part-time workers. In other countries, some employees may work only 30% of the normal schedule, and in some cases be paid differently, all depending on labor agreements and regulations. In China, if you're going to work for a company, you work full time. Otherwise, go somewhere else. And no labor agreements either, which makes it much easier to set up compensation plans and eligibility rules

Art Deco glory.
East meets West at the spendid
waterfront neighborhood known
as the Bund

Over lunch, when the Head of HR asked me why there were so many strikes in France (yes, that national trait has made it to the other end of the world) I replied, "For the usual reason: to get more money." She looked very surprised: "Really? But if they want more money and they are not getting it from their current employer, why don't they just move to another better-paying company?" Admirable logic, which makes sense in a fast-growing, emerging market like China, but, alas, does not apply in sclerotic European countries like France.

Language-wise (you may want to brush up on my 5 pillars of "glocalization") if you're going to roll out a global HRIS in China, make sure all self service features are available in Mandarin. Otherwise, the system won't be used. Many HR power users, even if working for a multinational company, will struggle with English, so having the whole system in Mandarin is a must.

Workflows with different levels of approvals is also a must-have in a country where deference to senior management is part and parcel of the culture. Electronic notifications have made great progress in the Middle Kingdom but some document still need to be printed out for signature and be handed out to the relevant recipient. If you ever wondered why China is referred to as the Middle Kingdom it's simply the name in Chinese: The first character for the name is a horizontal rectangle cut in half by a vertical stroke, meaning, you've guessed, Middle. Like all great societies, China sees itself as the center of the universe. Can't blame them; after all, they are the most populous nation on earth, soon to be the richest, and the one with the longest continuous civilization in the world.

It's all about Human Resources

HR rules and HR Departments are nothing new in this country. The US only got its Civil Service with its grades and steps and examinations at the end of the 19th century, but the Chinese Ming dynasty, which ruled the country until 1644, already had a Department of Personnel with a nine-grade bureaucracy and legendary examinations one had to sit for and pass before being entitled to a position. Modern China is simply the heir to a long, centuries-old  tradition.

Among the various HR domains and processes, time recording can be quite complex in many Chinese companies, especially manufacturing now that China has become the world's factory. However, soaring taxes, transportation and energy costs means that China's labor force is no longer as cheap as it was. China will increasingly have to move up the value chain, which explains the strong emphasis on training, competencies, learning and development, and executive assessment. Again, nothing surprising in this ancient Confucian culture where learning values  are rated very high.

The blogger ready to board the Shanghai
MagLev Train. At an average speed of 300 km/186 m
per hour, with a peak speed of 430 km/237 m per hour,
it is the world's fastest train.  It is also the only one that runs on
magnetic-levitation technology.  Whether it is profitable
remains to be seen as it is pricey and covers a short distance
(in a highly congested area, though)

Payroll, is of course, highly regulated like everywhere else, but China is far from being the worst offenders. And there are limits to nannying employees: for instance, salary advances, which in some countries are mandatory if requested by the employee, simply don't exist in China You are paid for the work done, not the promise of it. For any help, go to your family, is the message in a culture where family bonds are stronger than in the West, but weaker than in Mao's times (In China people don't resort to banks for their savings needs but rather to the family or peer-to-peer networks.)

Absence management is also complex, and China is rather unique in that it distinguishes between absence types mandated by law and  those awarded by a company as a benefit for a differentiated treatment. The former  have to be taken during the take period, and if the employee leaves before its end they are compensated; whereas the latter, if not taken, are lost and are not compensated. And just as part-time employees are unusual, taking an unpaid leave or a sabbatical is unheard of for most people. Note the existence of many recruiting and training agencies (such as Zhaopin or 51job.)

Benefits involve many players: government, worker union and employer. Noteworthy that if some benefits (such as birthday allowance) are not provided by the worker union then the employer will play the substitute role and provide them.

In a  country where education has long been seen as a passport  to success, small wonder that competency frameworks, training agencies and learning models are all the rage. Many companies would finance employee degrees in exchange for a guaranteed stay with the company (similar to tuition reimbursement by US companies.) For some useful training (such as languages), private enrollment would also be refunded by the employer if the employee brings evidence of the certification thus earned.


China's HRIS vendors hold their own
To meet the HRIS needs of Chinese companies, whether domestic or subsidiaries of multinationals, the array of providers is quite large. SAP's market share is largely around its on-premise offering, and Oracle's is based on PeopleSoft. Cloud vendors are represented by Workday, a distant third but growing fastest. Kronos is well-entrenched when it comes to time management. Unsurprisingly for such a highly patriotic, even nationalistic, country, Chinese vendors have, together, a majority market share. They include household names in China such as Beisen, the undisputed talent company, and other vendors such as Neusoft (or even micro-blogging firm Weibo) covering various HR processes, when not the whole gamut of functions.

The biggest challenge facing homegrown vendors is how to go global, not an easy task when some tools which we take for granted are not available in China. First-come visitors to China may be surprised, even shocked, to find that social media and internet tools like Facebook and Google are banned (unless you, or your company, are lucky to have your own VPN.) In the West, and even the rest of the world, so much HR work, actually so much business work, involves using these platforms that you may be thrown offbalance when you realize you cannot keep up with your friends (on Facebook), get your email (on Gmail), check a video on YouTube, or plan an itinerary on Google Maps. Surprisingly and erratically WhatsApp, despite being a Facebook product, is allowed to operate in China. The Chinese make do with local variants such as Baidu, Weibo or WeChat (which is integrated with LinkedIn.).

The Chinese are a justifiably proud nation, but also a pragmatic one. They will find ways to live up to their full potential and be a full member of the global business community, something they've longed for and craved for a long time.Needless to say that this post only covers the People's Republic of China (PRC) aka Mainland China. Taiwan, Hong Kong and Macao are completely different in terms of context, HR maturity and vendor landscape. In due course they will warrant their own blog post.

(The blogger is currently crisscrossing the globe gathering requirements for a multinational company. Next stop: Detroit, USA.)

(This is the latest in a series of wide-ranging articles focusing on a single country. Previous posts:

August 2011: Brazil Rising: Thoughts on HR, technology and an emerging giant 
December 2012: My 20-Year Affair with Spain  - with more than 9,000 views it is one of my most popular blog posts
June 2013: Thoughts on India, its HR/technology space
Nov. 2014: Of Switzerland, the country, its HR practice and technology landscape)

NOTE: All photos are the work of the blogger and copyright applies

From the blogger's library

*I strongly recommend Gary Jennings' superb novel, The Journeyer, about the great man's 13th- century travels throughout a China few  people had ever seen then. 1,000 pages which you can't put down until you reach the end. For anybody wanting to understand China's wrenching changes in a historical perspective, Jonathan Spence's In Search of Modern China is a must-read. Nobel-Prize winner Pearl Buck's novels, set in pre-Communist post-Imperial China,  have a lot to say about the Chinese soul and experience. The movie buff I am relishes Zhang Yimou's movies (especially when the incomparable Gong Li is in them): Raise the Red Lantern, Ju Dou, Red Sorghum and Flying Daggers are favorites. He is also the man behind the highly acclaimed opening and closing ceremonies at Beijing's 2008 Olympics. 

SOW - A Comparison of 3 Global Cloud HR vendors: SAP, Oracle and Workday

GENEVA & NEW YORK

The leader, the follower and the laggard

I have been asked for a while to share my system-evaluation and -implementation experience with the community and my readership by comparing the three most frequently shortlisted cloud HR systems: SAP (SuccessFactors), Oracle (Fusion) and Workday. I will from now on refer to them as SOW, to be pronounced either to rhyme with "low" (as in "low adoption") or to sound like a female pig since some of these vendors' features are no better than lipstick on a pig. *

Of apples and oranges
Although there are more than three cloud-based HR vendors, the reason I am limiting myself to the SOW usual suspects is because they are the only ones with a global reach to meet the complex requirements of multinational companies. Despite attempts to the contrary, Ultimate is still a US vendor, Meta4 has all but disappeared, HR Access has been folded into Sopra and Cornerstone has yet to make up its mind whether to develop a full-fledged HR Admin module - and without an HR system of record you cannot have a global HRIS worth its salt. ADP is mainly a payroll outsourcer with multiple products (some in the cloud and covering various HR processes) but not a global HR system of record. Infor has yet to rationalize its product offering à la Fusion and its Lawson offering was never a truly global HRIS. And some of these vendors' "cloud" offerings are really nothing more than a quick repackaging of their old hosting business. So, here we are, stuck with SOW.

This being said, it is worth remembering that to a large extent  we are comparing apples and oranges since there are such key differences between these vendors that some evaluation exercises can turn to the surreal. Oracle, for instance, is mainly a database vendor with a strong anti-cloud history and a PeopleSoft legacy customer base which has yet to endorse Oracle Fusion. SAP, which comes from the application world, has therefore more serious credentials, reinforced by its continuing investment in the SuccessFactors platform. Its main issue is that, in addition to some questionable product decisions, it has yet to articulate a cogent cloud-based ERP strategy.  This is the main reason why I refer to Oracle and SAP (along with some others) as dinosaurs in a popular blog post. Workday, on the other hand, is of course a native cloud vendor which has quickly shot to the top of the league table with an offering, business culture and service quality that the other dinosaurs can only dream of emulating. Yet, Workday is far from perfect and also has some serious issues.

SaaS and cloud
Some companies may not care about the differences between SaaS and cloud, some may even be ignorant of them, but it is good to remind my readership of the meaning of these  two concepts which are often and wrongly used interchangeably. SaaS is the most advanced form of the cloud where all parts of an offering (hardware, database, software) come from a  single vendor. All you the customer need to provide is a browser-toting device (desktop/tablet/smartphone) and you're in business. Workday is thus a true SaaS vendor. SuccessFactors, whose offering relies on some on-premise legacy features which are hosted, is getting there but cannot be considered 100% SaaS. As for Oracle, who first developed its Fusion product as  an on-premise solution, and can deliver it as a hosted system, it is therefore in the cloud but of course not SaaS. So remember this key differentiator: All SaaS systems are by definition cloud-based, but the reverse is not true.


Stats wars
As the community knows, I have zero tolerance for fanciful figures, especially around customer numbers. Some of the fairy tales I hear are so absurd that I am unsure whether to laugh or sob when I hear them. The below scorecards provide a reasonable count of LIVE customers as per each cloud system. If the customer is still on PeopleSoft for HR Admin and has interfaced it to Taleo or some Fusion talent modules, Oracle will refer to this misleadingly as Cloud HCM. I don't. Same thing for SAP: If Employee Central is not implemented, then I do not count SuccessFactors as a reference - it is only a talent project, not a global HR one. Workday is easier since, by definition, their system cannot run without core HR as a foundation (although some customers use a light HR version to start with talent processes such as performance.)

Integrated/interfaced/unified/organic etc.
After phony customer count figures, the biggest source of BS that comes from vendors has to do with how well integrated the offering is. Here misinformation is rife, with Oracle the undisputed leader. Fusion, which can come in different flavors as mentioned earlier (public cloud, private cloud, on-premise - see below) does not necessarily cover all HR processes and most customers prefer to hang on to the legacy core HR. Talent features can come from either Fusion or Taleo. And within Taleo remember that the Learn.com product was built on .NET technology whereas Taleo was built on Java.

SAP SuccessFactors at least developed Employee Central on its own technology stack; however Plateau was not a 100% SaaS offering, and Concur and Fieldglass are based on other technologies. The other SF modules are also on different technologies which means a customer running the whole suite will have different code bases AND versions. (And as for Multiposting, well, nobody knows when/if it will be integrated in SF/EC.) Not pretty, and not full SaaS. And, of course, Employee Central Payroll is anything but an Employee Central payroll.

Workday, on the other hand, as befits a product developed from scratch and organically, has the cleanest data model with all HR processes now available, except Learning. Payroll is largely work in progress, with the last two countries released (UK, France) yet to go live with a customer. I still have my doubts as to the ability of a single global SaaS payroll vendor to deliver the goods in an efficient manner.
I can already hear some jump and say, "Hold on a second. Workday, too, has integrated third-party technologies after acquiring Cape Clear and Identified." Most true, but there is a fundamental difference when you integrate a third-party product as part of your underlying technology and when you do it to cover a specific HR domain. With the latter you find yourself with a different look and feel, different workflows, a different data model. Any HR user who had to struggle with different products would tell you what a nightmare it is.

3 -VENDOR ANALYSIS: COMPANY COMPARISON

Oracle Fusion has come a long way from an on-premise, complex-to-implement, functionally limited product with an ugly look and feel (those overloaded screens with horrid blue!), to one that can be deployed in the cloud. To get a sense of Fusion's background, refer to my post "Error 404: Oracle Fusion not found".) Since then, it has made progress (especially on the  UI front when it moved from FusionFX to Skyros), but its two other competitors, both cloud natives, have moved faster and often better. Oracle still misses many key HR domains (see the product scorecard below) and its vision and roadmap at best are fuzzy, at worse don't make any sense: Why waste its time developing unneeded products such as Employee Wellness, Reputation Management, My Volunteering or low-priority ones such as HR Help Desk, and still miss, Tier-1 country localizations or Recruitment on the Fusion platform? The co-existence or hybrid approach is not a meaningful differentiator, but actually a sign of weakness: Missing key bits, Oracle tends to lump everything together and it's up to the customer to make sense of what is what and how to integrate it, not an easy task when Oracle is still not very forthcoming when it comes to its offering, as explained below.

Public Cloud, Private Cloud, and Cloud ServicesThe Taleo product line is a case in point: Officially rebranded as Oracle Talent Cloud (but on their website still referred to as Oracle Taleo Cloud) it is supposed to be the Recruiting offering to be interfaced to Fusion Core HR. However, the overlap issues (Fusion Performance vs Taleo Performance, say, or Fusion Compensation vs Taleo Compensation) has yet to be resolved. Ask the question and  you'll get a mumble from poor sales executives who are none the wiser. Note that Taleo is a hodgepodge of various acquisitions itself: Learn.com (with its scaling issues), Jobpartners, Recruitforce and Vurv, and Wordwide Compensation. (Not to mention that there are two Taleo flavors that go by the Enterprise and Business monikers)Talking about Compensation I find it a pity that Fusion does not allow user-defined logic to go into compensation elements, for instance to add a regional rate to a pay rate and calculate an employee's compensation on that basis.
Fusion, born as an on-premise product, can be hosted in a private cloud (customer's own environment) or shared (public cloud) with different deployment implications.
As if  the (con)Fusion was not enough, you have PeopleSoft Cloud Service which is as far from a SaaS offering as St Petersburg, Florida is from St Petersburg, Russia.
Then there is a host of other products such as Right Now Policy Automation (benefit eligibility), another acquisition, which Oracle throws at befuddled customers.
Making sense of Oracle's offering is clearly not for the faint-hearted.

Great products are built by great people. The converse is also true: Mediocre people build mediocre products. Oracle, with its stifling bureaucracy and awful management, has problems attracting and retaining quality people, especially in the HCM ¨product line. Add to that the fact that in Oracle's highly political culture the technology side has always had the upper hand versus product, and that HCM has always been the Cinderella application, only getting attention when a top leader emerges (first PeopleSoft, and now Workday.) This explains why the company never features in Great Places To Work league tables and has suffered from a steady hemorrhage of its best and brightest from PeopleSoft who have been poached from Workday, leaving a lot of deadwood behind.

An even bigger biggest issue with Oracle is how it (mis)treats its long-suffering customers. Just this week, an old customer, the  French Civil Aviation Authority, who has had enough of Oracle's abusive licensing and audit practices, decided to discontinue the use of all Oracle products. Last year, two other French companies, Carrefour and AFPA, went to court over the same issues and won. In 2014, a survey by the Campaign for Clear Licensing of 100 global Oracle customers found that 92% of them were deeply unhappy with the vendor. In the US, none other than the federal government decided in 2012 to ban Oracle from bidding for its business due to the vendor's questionable sales practices. Well, you get the idea. Unless you evince a particularly strong masochistic streak, selecting Oracle often  means tough times ahead.

On the technology front, Fusion, contrary to the vendor's spin, is not a "fusion" of its portfolio applications, but neither is it exclusively based on its unpopular EBS product line even if it borrows many features from it such as FastFormulas and Flexfields - the latter permeates Fusion even more than with EBS thus allowing good customization possibilities. However, Forms have mercifully been retired in favor of more modern Java and SOA-based technology. Outbound integration is a big headache as is data migration, even from Oracle's legacy systems. It is noteworthy that if many Oracle customers prefer to implement Fusion in the cloud rather than on-premise it is (in addition to the natural preference for the cloud), because, first, the HR Admin part has yet to reach functional parity with PeopleSoft (or Workday) and, second, the technical complexity of doing so is not to be ignored (just the sizing requirements would discourage the best-intentioned customer.)

Although initial pricing can be quite seductive (Oracle heavily discounts Fusion in order to drive up customer adoption, or offers a credit to swap on-premise applications for cloud-based Fusion), the vendor's customer-relations record, as mentioned earlier, is far from reassuring. Also, if you are an-on premise customer and are renewing/extending your license, Oracle will throw a cloud subscription at you included in the package. You might as well take it, even if you are unsure whether you'll actually move to the cloud.

In summary, customers  who already run an Oracle HR application (PeopleSoft, EBS, JDE), have a good rapport with the vendor (admittedly a rare occurrence), negotiate a financially interesting migration, do not need cutting-edge technology or terrific look and feel, and don't mind not being pampered or the complex integration behind products that come from disparate technological stacks, can look at Fusion seriously, especially when taking into account a strong point: its reversibility. Surprising as it may sound, there are still companies out there that are wary of the cloud (after the NSA snooping scandal and the current legal tug-of-war between US authorities and Apple and Microsoft you can't really blame them): With Oracle you can bring your HR system within your corporate firewall without having to switch systems and go through another complex implementation. This advantage comes at a hefty price, though: no single code line for all customers since, depending on what flavor of Fusion customers have, they can stay on their version much longer than public cloud customers. There are therefore multiple versions of Fusion at any given time, which increases the cost of running the product. And, as we all know, the customer always ends up bearing the costs. And if you are a customer who is still on the old look and feel, moving to the new one is not a straightforward process.

The world's largest business-software vendor, and the one with the most localized payrolls, took a leaf from its nemesis Oracle when it went down the acquisition road by acquiring SuccessFactors (SF). However, as I explained in detail in my blog post on their strategy just after the transaction was announced, SAP differs markedly from Oracle: Rather than build from scratch a product for the cloud, in which neither had any experience, SAP decided to continue investing in the SF platform by beefing up its Core HR/HR Admin product a.k.a. Employee Central (EC). Although the latter has grown significantly since its earlier releases, it has yet to catch up to the group's leader, Workday.

One increasingly important strong point of SF is that it belongs to a European vendor. With all the data-privacy issues raised by NSA snooping, many companies (especially European ones) are loath to go with a US-based vendor with a loss-of-data Sword of Damocles hanging over them.

Three weaknesses from SAP SF have yet to be solved:

-SF is still missing a payroll module based on its own platform, and the misleading Employee Central Payroll (in reality a hosted SAP Payroll) is no substitute for a truly integrated offering. SAP brought us the largest number of localized payrolls on earth; Why can't it use that expertise to enhance SF and make it a truly global and comprehensive HR offering? No full-fledged global HR system has come to market without its own payroll, so the jury is still out on whether SAP can be the exception that proves the rule.

- The multiple code lines and releases that make up the SF platform need to converge on a single code line and release based on EC. It is bad product design and worse customer support not to inform a customer that they are not enjoying a critical feature because they are on a older release  as happens with many customers. (Workday would never allow that to happen if only because the window customers have to move from one release to another is expressed in weeks, not months or years as is the case with SAP or Oracle.)

- SAP is also the vendor that brought us the integrated ERP. But it seems that all the strongly vaunted advantages of a single-platform ERP got lost in the move from on-premise to the cloud. All the HANA'ing in the world cannot hide the fact that the company that gave us the on-premise integrated business software is incapable of pulling the same trick in the brave new world of the cloud.

In a recent blog I compared SF's and Workday's pricing so no need for me to repeat myself since that analysis is recent and  therefore up to date. Oracle's talent-retaining issues are not unknown to SAP (I covered it in my recently updated blog post "Could the last executive leaving SAP turn the lights off, please?")

Another issue SAP needs to fix is the implementation methodology. SF came with its own methodology, SAP had another one, and integration partners are at times unaware of which is which. This will hardly help in building confidence in the offering. And the implementation template that SF provides does not list implementation activities in detail so you are often on your own. (Compare that with the fastidiously detailed documents you get from Workday)

Noteworthy is SAP's equivalent to Oracle's co-existence deployment model called here the Talent Hybrid model. The two approaches are not much to write home about since customers have been doing it for a while: Integrating their on-premise HR system of record with cloud-based talent features. Actually, customers started doing it even before SAP and SF found themselves under the same roof.

Who is the most likely customer for SF as a global HRIS? Experience shows that it is mainly SAP's on-premise customers who move to the cloud with it, especially if they are already using SF for their talent needs (in particular Performance or Learning.) However, an increasing number of SAP's on-premise customers include Workday in their cloud evaluation, and a worryingly lengthening list have decided to go with it. SAP, as a vendor, and SF, as a product, need to make themselves more attractive to retain these fickle customers.

3 -VENDOR ANALYSIS: PRODUCT COMPARISON

The HR thought leader and Wall Street darling has revolutionized the HR technology world (that search-based navigation was truly something out of this world when it first came out) and has just passed $1 billion in revenue (in comparison, Oracle's cloud HR business makes up less than 1% of its total revenue.) Workday also has more customers using it as a cloud-based HR system of record than Oracle and SAP  put together. They say that plagiarism is the best form of flattery; considering how many features of Fusion and SuccessFactors were obviously copied from Workday who premiered them, the newest kid on the block still retains its thought leader's crown.

What is attracting the crowds is a native-cloud product, built with consumer-grade usability, a depth of functionality that only those who built PeopleSoft could engineer, a customer focus and engagement that is still unique in the industry. The latter has made the vendor evolve its approach significantly: For instance, from the four releases a year at the beginning to a more manageable two now. Workday has also listened to customers and forsaken its rigidly neutral system-integrator (SI) approach: it will now recommend a specific SI for a specific project, something that was anathema for so long.

All the oohing and aahing about Workday, most of it well deserved, cannot hide that not everything is hunky-dory in the Pleasanton, CA-based HRIS heaven. You can read my Open Letter to Workday's founders for a discussion of these issues. There are still some surprising holes to plug in the offering such as the production of contracts and offer letters or some workflow limitations (despite the fact that their workflow framework is the best of the three.) So far, Payroll has been limited to North America and no date has been set for the release of the Learning piece. The talent features have been improved significantly, in no small measure through the addition  of a Recruitment module (some integration issues with their Core HR need  to be fixed), but Workday has yet to reach functional parity with SuccessFactors in the talent space.

Reporting is undoubtedly one of Workday's strongest suits. For those who use PeopleSoft, it is such a relief not to need to be a PeopleTools expert to write Workday reports. To a large extent you can even say that Workday is a collection of reports since wherever you are in the system you can pull up the relevant reports many of which are "actionable" to use the hackneyed word. But, careful, user-friendliness here is more for the HR team, not occasional users, and it may be better to restrict the creation of reports to a core reporting team rather than jeopardize consistency by having any/everybody duplicating existing reports.

Customization, or lack thereof, is the hallmark of SaaS systems. Unfortunately, in the  real world companies need a certain amount of customization which will not be lost when upgrading. Squaring the circle, you may think.  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. SuccessFactors, with its Metadata Framework-based extensibility approach (especially in Employee Central), does a better job in that respect and so does Oracle (with Flexfields, as mentioned earlier), as befits a product that is available both on-premise and in the cloud.

Workday's greatest success has probably been that a significant segment of their customers comes from companies that either had a Tier-2 vendor or did not have a single, global HR system of record (they used various payrolls and different talent tools.) When these customers finally get their act together, they tend to look at Workday first, rarely at SAP or Oracle. However, cloud-seeking SAP and Oracle customers will almost always evaluate Workday, even if they don’t systematically select it: that does not bode well for the dinosaurs’ cloud future.

3 -VENDOR ANALYSIS: TECHNOLOGY COMPARISON

NOTE ON SCORECARD METHODOLOGY
The grading is based on the many RFPs I have worked on and demos I have attended, along with my own knowledge of these products (derived in no small part from my own use of the systems) and feedback from customers other than the ones I have worked for.
The analysis has been done based on three sets of criteria: Vendor, Product and underlying Technology. Where awarding a grade does not make sense (such as pricing: expensive does not in and of itself mean bad, since often quality comes at a premium) I have left the relevant cells colorless. An explanation of most of the grades can be found throughout this blog post, but I have also mentioned them in the scorecards so that the reader can understand why a vendor is getting a YELLOW rather than an AMBER, for instance.

NOTE ON SOURCES AND COPYRIGHT
All data and graphs are by Ahmed Limam who is hereby asserting his copyright. They can be referred to with proper copyright and authorship acknowledgement.

*Some of the ideas in this post were first presented in an article I wrote for TechTarget in January 2015.

(In addition to the vendor-specific posts I mention throughout this piece, there are many more I wrote in the past few years focusing on a vendor or a particular issue. The most popular ones can be found in the list provided in the top-right corner and automatically updated based on viewer number. For other posts, you'll have to scroll down and search for them one by one). 

Pricing and contracting with your cloud vendor: Tips and tricks

RIO DE JANEIRO

As a new year starts, many of you will be busy working on an RFP for a new HR or ERP system. One aspect that draws little attention from the myriad  reports and posts on system evaluation deals with pricing, contracts and other T&Cs (terms and conditions). This means that because of the inherent knowledge imbalance between vendor and customer, the latter is always the loser as they tend to learn after the fact (the reason for this knowledge imbalance being that vendors respond to RFPs all year long, whereas customers  engage in new RFPs only once in a while, and their procurement departments cannot be expert in all business domains and vendors -especially for smaller-sized companies.)

So, as a New Year's gift to my readers, here are some advice and information which I am sure you will find useful as you negotiate the perilous shoals  of cloud contracting.

No public price list
Unfortunately for user organizations, cloud vendors are playing this game with their cards close to their chest. It is almost impossible for a new customer to find out what is the "true" price of a specific module - "true" meaning how much a comparable company has paid for the honor of becoming a user. Don't expect any customer to share that information freely at Workday Rising, SuccessConnect, Oracle World or Cornerstone Convergence. And as for the vendor, mum's the word. In other words, you're pretty much on your own here.

The basics

(This post focuses on pricing issues related to software vendors. Of course, an HRIS project often involves another  vendor, a system integrator, which brings pricing and contracting issues of its own. I will discuss those in a later post)