First, let’s understand what are ‘GROW with SAP’ and ‘RISE with SAP’ offerings. Both offerings have many things in common, in fact both are designed to support organizations in their digital transformation to an intelligent enterprise which requires the adoption of new technologies and redesign business processes, and ‘SAP S/4HANA Cloud’ sits in the heart of these offerings. One of the key differences between these offerings is that ‘GROW with SAP’ focus mainly on ‘SAP S/4HANA Cloud, public edition’, while ‘RISE with SAP’ is more tailored program and more flexible, targeting large and complex business needs and for that ‘SAP S/4HANA Cloud, private edition’ is another deployment option to provide flexible pathways for on-premise customers to have first step in the cloud world.
Since people are critical to any successful digital transformation, SAP is offering different HCM solutions for both ‘SAP S/4HANA Cloud’ editions (public and private) with different localization scope, so let’s take them one by one to know how localization is included in each edition.
SAP SuccessFactors Suite – which is public cloud offering – should be your final destination in HCM digital transformation journey where you land on environment of innovations focusing on reimagining HCM and legal compliance.
However, not all customers are ready to go for full (public) cloud HCM so SAP has offered HCM solutions for SAP S/4HANA Cloud, private edition to facilitate cloud transformation of classic ‘SAP ERP HCM’ and make use of enhancements & cloud value, at same time, retain investments by migrating existing core HR, time and payroll to private cloud without taking away the advantage of flexibility of extending and customizing the landscape with modifications and partner add-ons.
HCM solutions for SAP S/4HANA Cloud, private edition solution available in 35 languages and includes ‘Core HR’, ‘Time Tracking’ and ‘Payroll Processing’ which is localized for 105 countries (including partner local versions).
You will notice that ‘Talent Management’ is not part of the solution main scope because the key talent features are being replaced by SAP SuccessFactors talent solutions, see examples in below table:
The support of the on-premise ‘SAP ERP HCM’ (Enhancement Package 6, 7 & 😎 is ending by end of year ‘2027’ (even ‘SAP ERP HCM’ with lower enhancement package and ‘SAP S/4HANA HCM Compatibility Pack’ is ending by end of year ‘2025’). If you need to stay longer on-premise, then you can move to the new HCM solution for SAP S/4HANA, SAP Human Capital Management for SAP S/4HANA which has longer support terms that matches SAP S/4HANA (end of ‘2040’): So it works as a bridge solution to give additional time to customers like you who are not ready to make transition to cloud.
This solution was made available as part of SAP S/4HANA 2022 release which was released in October 2022. The next release 2023 of SAP S/4HANA, will be available in October 2023. From that release, SAP S/4HANA will change to a two-year release cycle.
The scope matches S/4HANA Compatibility Pack and the key functionality of SAP ERP HCM while leveraging some SAP HANA capabilities with wide simplification, see below examples for simplification:
You can check this note for more details about simplification.
The enhancements are focusing on 3 areas, UX, functional enhancements and performance improvement. For instance:
Yes! The 105 local versions of SAP ERP HCM have been converted to this solution.
Yes, SAP will provide migration tools and services to enable an “upgrade-like” migration. You can migrate ‘SAP ERP HCM’ from single instance (‘SAP ERP HCM’’ instance or ‘SAP S/4HANA’ with ‘HCM Compatibility Package’ instance) or multiple instances landscape (‘SAP ERP HCM’ and ‘SAP S/4HANA’ are on two separate instances) to ‘HCM solutions for SAP S/4HANA Cloud, private edition’.
P.S. You also have other options, like go for new implementation or selective data transition, see this blog for more details.
Yes, in the begin of 2023, ‘SAP Human Capital Management for SAP S/4HANA’ 2022 release was made available for ‘SAP S/4HANA Cloud, private edition’.
P.S. You can opt for a lower release. i.e., ‘SAP ERP HCM’ (Enhancement Package 7 or 8).
Moving to ‘SAP SuccessFactors HXM Suite’ will enable you to have access to born-in-cloud innovation. It provides the foundation to reimagine how HR delivers experiences with unmatched scalability and localization scope. HCM functionality is not includes in SAP S/4HANA Cloud, public edition.
The ‘Core HCM’ or ‘SuccessFactors Employee Central’ is localized for 104 countries and available in 45 languages. “Payroll” or ‘SAP SuccessFactors Employee Central Payroll’ is localized for 52 countries (including partner local versions) and available in 34 languages.
To future-proof people transformation, SAP has launched an initiative HXM Move which is a migration program that helps moving from on-premise ‘SAP ERP HCM’ to ‘SAP SuccessFactors HXM Suite’ solutions using tools, assets, and services, that makes the journey smooth and straightforward. transition existing on-premise HR solutions to SAP SuccessFactors Human Experience Management (HXM) Suite.
Scenario #1 You are new to SAP and want HCM on cloud, then go for SuccessFactors suite ‘new implementation’.
You currently have On-Premise SAP ERP HCM (Core HR, Payroll and Time)
Scenario #2 Go for ‘full transformation’, big bang de-modification and standardization with ‘SAP SuccessesFactors Employee Central’, ‘SAP SuccessesFactors Employee Central Payroll’ and ‘SAP SuccessesFactors Time Tracking’.
Scenario path 3A-3B-3C Enhance user experience by implementing ‘SAP SuccessesFactors Employee Central’ first, while keeping Payroll and Time on ERP, then follow step-by-step move to complete the transformation, Time to ‘SAP SuccessesFactors Time Tracking’ then Payroll to ‘SAP SuccessesFactors Employee Central Payroll’.
Scenario path 3A-4B-4D-4E Start with hybrid model, implement ‘SAP SuccessesFactors Employee Central’ while moving ERP Payroll and Time to ‘HCM Solutions for SAP S/4HANA Cloud, Private Edition’ to reduce TCO. After realizing the new user experience, go and complete the transformation for Payroll and Time to ‘SuccessesFactors Employee Central Payroll’ and ‘SAP SuccessesFactors Time Tracking’.
Scenario path 4A-4B-4C-4D-4E Lift and shift your SAP ERP HCM to ‘HCM Solutions for SAP S/4HANA Cloud, Private Edition’ then gradually work on de-modification and standardization to complete the transform to ‘SAP SuccessesFactors Employee Central’, ‘SAP SuccessesFactors Employee Central Payroll’ and ‘SAP SuccessesFactors Time Tracking’.
You have hybrid landscape, core HR on ‘SAP SuccessesFactors Employee Central’ but Payroll and Time is on ERP.
Scenario path 3B-3C Prepare for the move from hybrid to full cloud and once you are ready, transform Payroll and Time on ERP to ‘SAP SuccessesFactors Employee Central Payroll’ and ‘SAP SuccessesFactors Time Tracking’.
Scenario path 4B-4C-4D-4E Move Payroll and Time from ERP as-is to ‘HCM Solutions for SAP S/4HANA Cloud, Private Edition’ then gradually complete the transformation to ‘SAP SuccessesFactors Time Tracking’ then ‘SAP SuccessesFactors Employee Central Payroll’.
SAP has the following HCM offerings
This blog gives an overview about current SAP strategy for HCM solutions and localization. However, please bear in mind that the no. of local versions keeps growing and SAP's strategy keeps evolving and exceptions might take place (see SAP disclaimer).
Since people are critical to any successful digital transformation, SAP is offering different HCM solutions for both ‘SAP S/4HANA Cloud’ editions (public and private) with different localization scope, so let’s take them one by one to know how localization is included in each edition.
Let’s start with ‘SAP S/4HANA Cloud, private edition’.
SAP SuccessFactors Suite – which is public cloud offering – should be your final destination in HCM digital transformation journey where you land on environment of innovations focusing on reimagining HCM and legal compliance.
However, not all customers are ready to go for full (public) cloud HCM so SAP has offered HCM solutions for SAP S/4HANA Cloud, private edition to facilitate cloud transformation of classic ‘SAP ERP HCM’ and make use of enhancements & cloud value, at same time, retain investments by migrating existing core HR, time and payroll to private cloud without taking away the advantage of flexibility of extending and customizing the landscape with modifications and partner add-ons.
What are the Key Capabilities of ‘HCM solutions for SAP S/4HANA Cloud, private edition’ and localization scope?
HCM solutions for SAP S/4HANA Cloud, private edition solution available in 35 languages and includes ‘Core HR’, ‘Time Tracking’ and ‘Payroll Processing’ which is localized for 105 countries (including partner local versions).
| Core HR (incl. ESS/MSS) | Employee Administration Global Assignment Management Organizational Structure Management Position Management Benefits Management Work Schedule Management Absence Management |
| Time Tracking (incl. ESS/MSS) | Work Schedule Management Absence Management Employee Time Tracking Time Calculation Rostering and Shift Optimization |
| Payroll Processing (incl. ESS) | 105 payroll country versions (56 by SAP, 49 provided by partners) in 35 languages. |
You will notice that ‘Talent Management’ is not part of the solution main scope because the key talent features are being replaced by SAP SuccessFactors talent solutions, see examples in below table:
| Talent Management Functionality | Alternative Solution |
| Recruiting | SAP SuccessFactors Recruiting (or SAP E-Recruiting for SAP S/4HANA Add-on) |
| Compensation Management | SAP SuccessFactors Compensation |
| Development Plans | SAP SuccessFactors Succession & Development |
| Career and Succession Planning | SAP SuccessFactors Succession & Development |
| Appraisal System | SAP SuccessFactors Performance & Goals |
| Training and Event Management | SAP SuccessFactors Learning (or SAP Learning Solution for SAP S/4HANA Add-on) |
I am not ready yet to go for cloud, how long I can keep running HCM on-premise?
The support of the on-premise ‘SAP ERP HCM’ (Enhancement Package 6, 7 & 😎 is ending by end of year ‘2027’ (even ‘SAP ERP HCM’ with lower enhancement package and ‘SAP S/4HANA HCM Compatibility Pack’ is ending by end of year ‘2025’). If you need to stay longer on-premise, then you can move to the new HCM solution for SAP S/4HANA, SAP Human Capital Management for SAP S/4HANA which has longer support terms that matches SAP S/4HANA (end of ‘2040’): So it works as a bridge solution to give additional time to customers like you who are not ready to make transition to cloud.
This solution was made available as part of SAP S/4HANA 2022 release which was released in October 2022. The next release 2023 of SAP S/4HANA, will be available in October 2023. From that release, SAP S/4HANA will change to a two-year release cycle.
What is the scope of ‘SAP Human Capital Management for SAP S/4HANA?
The scope matches S/4HANA Compatibility Pack and the key functionality of SAP ERP HCM while leveraging some SAP HANA capabilities with wide simplification, see below examples for simplification:
| Appraisal System | Objective Settings & Appraisals or SAP SuccessFactors Performance & Goals |
| Career and Succession Planning | Talent Management & Development or SAP SuccessFactors Succession & Development |
| Compensation Management | Enterprise Compensation Management or SAP SuccessFactors Compensation |
| Development Plans | Talent Management & Development or SAP SuccessFactors Succession & Development |
You can check this note for more details about simplification.
What is new in ‘SAP Human Capital Management for SAP S/4HANA’?
The enhancements are focusing on 3 areas, UX, functional enhancements and performance improvement. For instance:
- New Fiori Apps and enhancements for existing Fiori Apps besides visual harmonization for most common transactions in the areas of HR Administration, Organizational Management, Time, and Payroll.
- Continuous legal changes.
- Data Protection and Privacy
- More utilization of HANA capabilities.
Is ‘SAP Human Capital Management for SAP S/4HANA’ also localized like the classic ERP?
Yes! The 105 local versions of SAP ERP HCM have been converted to this solution.
Will SAP help me with migration?
Yes, SAP will provide migration tools and services to enable an “upgrade-like” migration. You can migrate ‘SAP ERP HCM’ from single instance (‘SAP ERP HCM’’ instance or ‘SAP S/4HANA’ with ‘HCM Compatibility Package’ instance) or multiple instances landscape (‘SAP ERP HCM’ and ‘SAP S/4HANA’ are on two separate instances) to ‘HCM solutions for SAP S/4HANA Cloud, private edition’.
P.S. You also have other options, like go for new implementation or selective data transition, see this blog for more details.
So, is ‘SAP Human Capital Management for SAP S/4HANA ’ now included in ‘SAP S/4HANA Cloud, private edition’?
Yes, in the begin of 2023, ‘SAP Human Capital Management for SAP S/4HANA’ 2022 release was made available for ‘SAP S/4HANA Cloud, private edition’.
P.S. You can opt for a lower release. i.e., ‘SAP ERP HCM’ (Enhancement Package 7 or 8).
Now let’s talk about ‘HCM solutions for SAP S/4HANA Cloud, public edition’
Moving to ‘SAP SuccessFactors HXM Suite’ will enable you to have access to born-in-cloud innovation. It provides the foundation to reimagine how HR delivers experiences with unmatched scalability and localization scope. HCM functionality is not includes in SAP S/4HANA Cloud, public edition.
How ‘SAP SuccessFactors HXM Suite’ is localized?
The ‘Core HCM’ or ‘SuccessFactors Employee Central’ is localized for 104 countries and available in 45 languages. “Payroll” or ‘SAP SuccessFactors Employee Central Payroll’ is localized for 52 countries (including partner local versions) and available in 34 languages.
How to move to SAP HXM SuccessFactors?
To future-proof people transformation, SAP has launched an initiative HXM Move which is a migration program that helps moving from on-premise ‘SAP ERP HCM’ to ‘SAP SuccessFactors HXM Suite’ solutions using tools, assets, and services, that makes the journey smooth and straightforward. transition existing on-premise HR solutions to SAP SuccessFactors Human Experience Management (HXM) Suite.
So what are the different ‘move scenarios?
New Implementation
Scenario #1 You are new to SAP and want HCM on cloud, then go for SuccessFactors suite ‘new implementation’.
Move from On-Premise to SAP SuccessFactors
You currently have On-Premise SAP ERP HCM (Core HR, Payroll and Time)
Scenario #2 Go for ‘full transformation’, big bang de-modification and standardization with ‘SAP SuccessesFactors Employee Central’, ‘SAP SuccessesFactors Employee Central Payroll’ and ‘SAP SuccessesFactors Time Tracking’.
Scenario path 3A-3B-3C Enhance user experience by implementing ‘SAP SuccessesFactors Employee Central’ first, while keeping Payroll and Time on ERP, then follow step-by-step move to complete the transformation, Time to ‘SAP SuccessesFactors Time Tracking’ then Payroll to ‘SAP SuccessesFactors Employee Central Payroll’.
Scenario path 3A-4B-4D-4E Start with hybrid model, implement ‘SAP SuccessesFactors Employee Central’ while moving ERP Payroll and Time to ‘HCM Solutions for SAP S/4HANA Cloud, Private Edition’ to reduce TCO. After realizing the new user experience, go and complete the transformation for Payroll and Time to ‘SuccessesFactors Employee Central Payroll’ and ‘SAP SuccessesFactors Time Tracking’.
Scenario path 4A-4B-4C-4D-4E Lift and shift your SAP ERP HCM to ‘HCM Solutions for SAP S/4HANA Cloud, Private Edition’ then gradually work on de-modification and standardization to complete the transform to ‘SAP SuccessesFactors Employee Central’, ‘SAP SuccessesFactors Employee Central Payroll’ and ‘SAP SuccessesFactors Time Tracking’.
Move from Hybrid to SAP SuccessFactors
You have hybrid landscape, core HR on ‘SAP SuccessesFactors Employee Central’ but Payroll and Time is on ERP.
Scenario path 3B-3C Prepare for the move from hybrid to full cloud and once you are ready, transform Payroll and Time on ERP to ‘SAP SuccessesFactors Employee Central Payroll’ and ‘SAP SuccessesFactors Time Tracking’.
Scenario path 4B-4C-4D-4E Move Payroll and Time from ERP as-is to ‘HCM Solutions for SAP S/4HANA Cloud, Private Edition’ then gradually complete the transformation to ‘SAP SuccessesFactors Time Tracking’ then ‘SAP SuccessesFactors Employee Central Payroll’.
Now let’s summarize
SAP has the following HCM offerings
- “SAP Human Capital Management for SAP S/4HANA” and “HCM solutions for SAP S/4HANACloud, private edition”
- SAP SuccessFactors is the desired future state so you can migrate to “SAP Human Capital Management for SAP S/4HANA” to get some time to plan for the transformation and the “HCM solutions for SAP S/4HANACloud, private edition” is there if you want to do it gradually.
- All HCM offerings are localized, and legal changes will be continuously delivered. Check this world map overview to know more about local versions and languages covered by HCM localization. You can also check each local version here.
Disclaimer
This blog gives an overview about current SAP strategy for HCM solutions and localization. However, please bear in mind that the no. of local versions keeps growing and SAP's strategy keeps evolving and exceptions might take place (see SAP disclaimer).
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