For almost every business operating in the market today, growth and change are constant realities, bringing with them growing Human Resources (HR) challenges. These challenges can range from payroll management and HR operations to supporting complicated onboarding and compensation requirements. Given the nature and complexity of these, even professionals can often get overwhelmed by the sheer amount of work, especially without the right tools.  

Modern Human Capital Management (HCM) solutions address these challenges by offering tools that automate and simplify the management and administration of all HR activities. Among such platforms, SAP HCM and SAP SuccessFactors HCM are two platforms, offered under the SAP solutions umbrella, designed to facilitate different business models. 

However, the existence of these tools begs the question: which SAP solution offers the best HCM solutions for your specific needs? Our SAP HCM vs SuccessFactors comparison guide answers exactly that by examining how each solution supports businesses in achieving their strategic investment goals. 

SAP HCM Vs SuccessFactors: At A Glance

While both solutions share SAP’s HCM foundation, they differ primarily in their deployment models, flexibility, and cloud-readiness. SAP HCM has solutions focused primarily around ‘on-premise’ support and security, while SuccessFactors offers an adaptable, cloud-based system. 

Feature SAP HCM SuccessFactors 
Payroll Unified payroll management with automated processing for better control Payroll calculations with flexible pay and tax compliance suitable for international systems 
Time Tracking Flexible time recording with global coverage and integrated payroll User-friendly time keeping with instant insights and a unified approval center for managers 
Document Management Centralized document creation with automated compliance support, in-house data storage Digital employee record creation with cloud deployment 
Onboarding AI-enabled onboarding with guided new-hire experiences Customized new hire home pages with informative onboarding dashboards 
Reporting And Analytics Actionable employee insights allowing HR to make data-driven decisions in real-time Reports center on workforce analytics and custom requirements, supporting a cloud-based system 

What is SAP HCM?

SAP HCM is a powerful Human Resources Management System (HRMS) that offers services as a core module of the SAP solutions. It is designed to help organizations automate and manage key HR processes, while making sure that its users have a high level of control and customization. The solution is favored by organizations seeking deeper customization, complex payroll support, and strict data-privacy rules. 

The platform offers tools for workforce management and organizational administration, along with time tracking features that are integrated with a powerful payroll processing system. 

Unique Features Of SAP HCM 

  • On-Premise System: SAP HCM provides businesses with great control over their information and data by offering an on-premises approach. This means that the system provides localized payroll and time rule compatibility
  • Customization with ABAP: The platform allows users to modify and customize built-in permission checks and log changes through SAP's own custom programming language, Advanced Business Programming Application (ABAP)
  • Native Integration SAP ERP: As an original component of the SAP Business system, SAP HCM is compatible with the SAP legacy, giving users native integration with other systems in the SAP environment, like SAP ERP

What Is SuccessFactors?

SAP acquired SuccessFactors in 2012, and with their collaboration, SAP SuccessFactors HCM was introduced. This HCM system is designed to offer a more cloud-centric approach. The system helps organizations manage the entire employee lifecycle, from recruitment to retirement, with a focus on scalability, user experience, and integration. The platform retains key features from the SAP HCM ‘on-premise’ model, while modernizing them for the cloud deployment that covers everything from timekeeping and payroll to talent management and employee experience management, along with detailed HR analytics.  

The solution is designed for a shift from traditional HCM needs by offering a more engaging and individualized experience. It allows businesses to attract top talent, develop their workforce, and work on unique HR strategies that align with their overall business goals. 

Unique Features Of SuccessFactors

Unique Features Of SuccessFactors

  • Employee Experience Management (HXM): This feature allows businesses to collect real-time feedback from employees at key moments in their journey, such as during onboarding or performance reviews. Using this, organizations can understand trends like employee turnover and take targeted, and data-driven actions
  • Talent Development: With this feature, SuccessFactors gives users tools designed to develop an organization's existing workforce. It combines skill-based recommendations and training with onboarding and performance management, as well as succession planning, and learning (LMS) into a single system
  • Compensation Management: The platform also provides a powerful compensation management system that allows users to improve their business with personalized rewards

SAP HCM Vs SuccessFactors: Fundamental Differences

SAP HCM and SuccessFactors differ fundamentally in their deployment and operational philosophies. While SAP HCM remains a time-tested and supported system for centralized, in-house payroll and HR operations, SuccessFactors represents a cloud-based, modern alternative for evolving and expanding companies having non-traditional HR needs.  

Where SAP HCM stands as the flagship offering from SAP solutions, being a unified, all-in-one, and hassle-free system, SuccessFactors operates in the form of a modular and experimental set of offerings, which is essentially a pick-and-choose HCM suite that builds on SAP’s traditional modules. 

SAP HCM Vs SuccessFactors: Key Features Comparison

Payroll

SAP HCM offers an on-premise payroll engine that is suited for organizations that value financial privacy and protection. It offers a customizable payroll process, using ABAP to handle personalized payment details, collective agreements, and country-specific regulations.

Its native integration with SAP Finance modules allows for better financial posting and reporting, providing a higher level of control for businesses that manage their own IT infrastructure.

On the other hand, SAP SuccessFactors offers ‘Employee Central Payroll,’ which is essentially the same as SAP HCM’s payroll engine but managed in the cloud. This provides users with the added security of staying up to date with regulations in 59 different locales, lowering the chance of non-compliance.

Users can leverage ‘Employee Central Payroll’ to adapt the payroll process to evolving requirements and expand their business to new markets. The platform also offers flexible deployment options to help users deal with their unique payment needs.

Winner: SuccessFactors – While SAP HCM offers strong localized payroll and customization options, SuccessFactors wins this category with its Employee Central Payroll platform that provides the same level of payroll support as SAP HCM, but on a global scale.

Time Tracking

SAP HCM comes with time management tools for recording attendance, managing work schedules, detailing check-ins and check-outs, and integrating time data for payroll. The platform can handle flexible time-tracking rules, allowing employees to clock in from desktops, mobile devices, and physical terminals.

It also comes with global and local coverage, making sure companies are compliant with local as well as international timekeeping regulations.

SAP SuccessFactors offers a modernized and cloud-native time-tracking solution designed with the employee experience at the center. It offers a user-friendly and mobile-enabled interface that allows employees to clock in and out, submit timesheets, and request time off at their own convenience.

The system also provides greater visibility and insights for managers to help them make better decisions and includes automated alerts that simplify the approval process and improve data accuracy.

Winner: SuccessFactors – Although SAP HCM has better localized integration between time data and payroll functions, SuccessFactors is the winner in this category with centralized user experience, greater mobile accessibility, and self-service time-keeping capabilities.

Document Management

SAP HCM offers centralized document management capabilities that allow managers to store and manage employee documents from a single location. This makes employee documents easily accessible for both managers with full-search features and employees with self-service capabilities.

The platform also offers automated HR document generation tools that can be used to create customized and accurate employee documents for better communication. The solution also offers compliance with retention rules and file checks.

SAP SuccessFactors includes a fully integrated document management system with cloud deployment and interactive HR document generation features. The platform allows managers to create shared employee files that are retention-compliant and interactive, allowing employees to add access data.

The solution also allows for granular permission controls, document generation, and e-signature capabilities, providing both employees and HR teams with easy, self-service access to their information.

Winner: SAP HCM – SuccessFactors offers a powerful, cloud-based document management and storage solution, but SAP HCM wins this round with its centralized, in-house, and secure approach to document handling, which comes with powerful access controls.

Onboarding

SAP HCM offers AI-powered onboarding capabilities that streamline the completion of onboarding tasks and get new hires settled faster. It uses AI assistance to generate personalized, guided experiences as well as digital forms to make onboarding easier and more customized.

The platform helps users simplify global onboarding by engaging alumni and uses a centralized dashboard to ensure compliance and data accuracy.

SuccessFactors offers an onboarding module that is designed to enhance the new hire experience with personalized guidance and connections to peers. It comes with an onboarding dashboard that allows managers to create custom welcoming programs and automate activities to make sure the process goes smoothly.

The platform allows for the creation of configurable onboarding workflows that are suitable for all kinds of new hire needs, and guided onboarding journeys that ensure new hires have the skills they need from day one.

Winner: SAP SuccessFactors – While SAP HCM offers dedicated and guided onboarding workflows, with AI support, SuccessFactors is the clear winner here for its experience-driven and customizable approach to onboarding that offers unique onboarding workflows for each employee.

Reporting And Analytics

SAP HCM gives managers data-driven and actionable insights into employee behavior, allowing them to make decisions that align with their specific workplace needs. It empowers HR teams with customized reports and strategies. The platform lets managers monitor all employee changes to analyze talent flow and growth across departments.

SAP SuccessFactors, in contrast, provides a more user-centric People Analytics solution, powered by SAP Analytics Cloud. It offers self-service tools, interactive dashboards, and data visualization that allow users to explore HR data in real time. The platform also provides predictive analytics and workforce planning data, allowing managers to make proactive and data-driven decisions about their employees.

Winner: SAP SuccessFactors – Despite SAP HCM offering detailed data-driven insights, SuccessFactors takes the edge in this category by providing a more accessible set of analysis tools, with self-service analytics features.

SAP HCM Vs SuccessFactors: Which Solution Offers You The Best Pricing Options?

While both solutions are offered by SAP, they offer unique pricing plans based on differences in deployment and customer needs. SAP HCM offers simple pricing for its on-premises SAP Core HR plan at $18.00/user/month, with other HCM features offered as add-ons. This pricing system is better suited for companies seeking a unified and complete HCM solution in one place, without the hassle of sorting through different modules.  

On the other hand, SuccessFactors offers its features in modular form, following a more SaaS focused approach. Businesses can choose to buy as a customer for direct usage or buy as a partner to integrate and resell its HCM capabilities. The pricing starts at $2.57/user/month for its time tracking module. The SuccessFactors pricing system is better suited for businesses looking for a more specialized set of HCM services, instead of an in-house, all-in-one system. 

Final Verdict: Which Workforce Solution Is Best For You?

Both SuccessFactors and SAP HCM are offered by the same parent company and stand out as powerful platforms for HRIS functions, excelling in ways that cater to different types of HR needs. SuccessFactors, the apparent winner of our comparison, excels in its advanced onboarding and reporting capabilities as well as its time tracking features that ensure accuracy for payroll and compliance. 

SAP HCM also has its merits, being a proven and mature solution, known for its streamlined and simplified solutions. The platform offers a more centralized tool to deal with all core HR functions. However, as the comparison suggests, it may not be ideal for users with more specific and evolving HR needs. 

Overall, choosing between the two ultimately depends on the specific needs of your HR teams and the nature of the issues your business might be dealing with.