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1PUBLIC© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ

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Michael Müller, Head of Presales HCM Cloud, SAP (Schweiz) AG

June 2018

SAP HCM on premise & Cloud


SAP HCM Investment Direction

SAP S/4 HANA and HCM

Transition to S/4 HANA HCM

SAP HCM On-Premise Option for SAP S/4HANA – Announcement January 2018

Agenda


Legal disclaimer

The information in this presentation is confidential and proprietary to SAP and may not be disclosed without the permission of SAP. Except for yourobligation to protect confidential information, this presentation is not subject to your license agreement or any other service or subscriptionagreement with SAP. SAP has no obligation to pursue any course of business outlined in this presentation or any related document, or to developor release any functionality mentioned therein.

This presentation, or any related document and SAP's strategy and possible future developments, products and or platforms directions andfunctionality are all subject to change and may be changed by SAP at any time for any reason without notice. The information in this presentation isnot a commitment, promise or legal obligation to deliver any material, code or functionality. This presentation is provided without a warranty of anykind, either express or implied, including but not limited to, the implied warranties of merchantability, fitness for a particular purpose, or non-infringement. This presentation is for informational purposes and may not be incorporated into a contract. SAP assumes no responsibility for errorsor omissions in this presentation, except if such damages were caused by SAP’s intentional or gross negligence.

All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially fromexpectations. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates, andthey should not be relied upon in making purchasing decisions.

SAP HCM Investment Direction


SAP ERP HCM (On-Premise)Proven across 15,000 global customers with 30 years of development, supporting…

Organization ManagementBuild, maintain, and align organizational structures.

HR AdministrationImprove insight into the workforce with a foundation of consistent, accurate data.

Benefits Enrollment and AdministrationSupport development and management of employee benefit plans.

Payroll ProcessingProcess and enable accurate, on-time payrolls across the enterprise.

Employee Self-ServiceImprove employee productivity by automating processes.

Manager Self-ServiceIncrease productivity and reduce operational burdens.

HR Shared ServicesDeliver accurate, consistent, and timely responses to employees and managers.

SAP Employee File Management Application by Open TextConsolidate, centralize, and search employee documentation.

SAP Organizational Visualization by NakisaPlan and model organizations, view organizational charts


SAP ERP HCM Simplifying HCM processes and user experience examples

Landing pages – UI Lanes for efficient navigation

Payroll Control Center: Real-time insight into payroll processes

Fiori-based ESS and MSS


SAP SuccessFactors – next generation HR solutionUnmatched solution breadth and depth

Competencies | Skills | Best Practices

Core HR

Recruiting Learning Performance & Goals

Succession & Development

Employee Recordkeeping | Organizational Management | Global BenefitsShared Services | Payroll | Time & Attendance

Technology: Secure | Integrate | Extend

User Experience: Social | Mobile | Intelligent Services

CompensationOnboarding

Talent Management

Reporting & Embedded Insight Workforce Analytics Workforce Planning


SAP SuccessFactorsA complete HR system in the cloud

New Homepage

Action Search

Mobile solution


Transitioning to Cloud with Core HRLeverage existing investments, connect with delivered integrations

Cloud

On-PremiseSAP ERP

Core HR + Talent + Analytics

Full Cloud

Core HR

SAP ERP

Talent, Analytics

Cloud Core HR

For All Employees

Side-by-Side

Delivered and Maintained Integrations

SAP ERP

Core HR + Talent + Analytics

Core Hybrid

Core HR(only for certain processes)


SAP product lines for HCMInvestment direction

SAP ERP HCM Innovation investments focused primarily

on User Experience and Localization across Core HR and Payroll processesMainstream maintenance through 2025

SAP SuccessFactors Most innovation investments are focused

here to re-think and re-imagine HCM

CloudOn-Premise

SAP S/4 HANA and HCM


SAP S/4HANAOur next-generation business suite

SAP S/4HANA Enterprise Management –build the next-generation business suite

» Innovative in-memory database» New architecture and data models» Renewed applications» New user interface (UI) technology» Cloud and on-premise deployment models» Natively integrated

SAP S/4HANA is a new product line (it is not a legal successor of any SAP Business Suite product).

The classical SAP Business Suite and SAP ERP software is a separate product line and will still be available.

SAP Ariba l Concur I SAP Fieldglass I SAP Hybris I SAP SuccessFactors

On Premise Cloud


Solution Scope SAP HCM for SAP S/4HANA, on-premise

Includes: • HR Administration• Organization Management• Personnel Development• Payroll• Time & Attendance• Benefits & Compensation• MSS / ESS

Excludes:• SAP Learning Solution (LSO)• SAP E-Recruiting• Travel Management (FI-TV)

Functional scope comparable with ERP HCM / SAP S/4HANA HCM compatibility packages:


SAP S/4HANA Compatibility Scope

Compatibility Scope

• Described in Simplification List on help.sap.com

• Simplification List is compiled from SAP Notes

• General HCM Approach: 2273108• Conversion EE-BuPa: 2340095• LSO: 2383837• E-Recruiting: 2383888• Java-based ESS/MSS: 2383879


SAP S/4 HANA Human Resources: Success is Simply Humanfor S/4 HANA Cloud and S/4 HANA OnPremise Dynamics of engaging people include handling evolving workforce, workplace complexity and the battle for talent all of which has a strong

impact on the rest of the organization SuccessFactors is the recommended next generation Human Resources foundation for S/4HANA With S/4HANA Human Resources, workforce can have role based and quick access to enterprise transactions based on organization,

personal attributes and run enterprise processes based on quality single source on information

Key Message

17

Competencies | Skills | Best Practices

Core HR

Recruiting Learning Performance & Goals

Succession & Development

Employee Recordkeeping | Organizational Management | Global BenefitsShared Services | Payroll | Time & Attendance

Human Capital Analytics

Talent Management

Technology: Secure | Integrate | Extend

User Experience: Social | Mobile | Intelligent Services

CompensationOnboarding

Transition to SAP S/4HANA (HCM view)


SAP ERP HCM Transition options for Human ResourcesMove at your own pace

SAP ERP HCM SuccessFactors Employee Central

Clo

ud

Solu

tions

On-

prem

ise

Solu

tions

4

SAP ERP HCM

1

HCI orBoomi

2

HCI

3

SAP ERP HCM

ALESAP ERP

SAP ERPSAP ERP


SAP S/4HANA Transition options for Human ResourcesMove at your own pace

SAP ERP HCM (Available in S/4HANA OnPremise only)SuccessFactors Employee Central

Clo

ud

Solu

tions

On-

prem

ise

Solu

tions

4

Deploy all On-premise with SAP ERP HCM in same instance(part of compatibility pack*)

SAP ERP HCM

1

Deploy S/4 HANA On-premise, move

HCM to cloud

HCI

2

Deploy S/4 HANA cloud, move HCM to the cloud

HCI

3

Deploy all On-premise: continue to keep SAP ERP HCM separate

SAP ERP HCM

ALE

* Maintenance of compatibility pack until 2025

S/4HANA cloud

SAP HCM On-Premise Option for SAP S/4HANA – Announcement January 2018


We’re listening to the market – and our customers

HCM Market CAGR 2017 – 2021 • Cloud is growing at ~15% CAGR• On-Premise is declining ~15% CAGR

SAP Investment strategy: • Most HCM R&D at SAP is focused on SuccessFactors/Cloud• Selected investments only in ERP HCM/on-premise (mostly compliance, UX)

Customer Observations• More and more organizations moving from ERP HCM to SuccessFactors • A subset of our S/4HANA customers desire to keep HCM on-premise for the

foreseeable future• S/4HANA has no native HCM capabilities – must use ERP HCM (for on-premise) or

SuccessFactors • ERP HCM Mainstream Maintenance currently provided through the end of 2025


Our response: SAP HCM for S/4HANA, on-premiseProject name “Sidecar”

A new on-premise HCM option for S/4HANA customers who desire to keep HCM on-premise

Solution plans:

• Based on SAP ERP HCM (it is not a completely new solution)

• Selected new optimizations and capabilities that leverage SAP HANA

• Runs on SAP HANA database only

• Maintenance support provided until at least 2030

We see this option primarily as a bridge to give additional time to those customers who are not ready to fully move their HCM deployment to the cloud/SuccessFactors


What are the transition paths?For SAP ERP HCM customers

Status Today

Interim Statusafter

2023/2025

Strategic Direction

SAP ERP

S/4HANA

S/4HANA

SAP ERP HCM

HCM for S/4

Customers who run SAP HCM on a separate instance can simply migrate to SAP HCM for S/4HANA, on-premise in an upgrade-like process

SAP ERP customers that run on a single instance will need to carve out SAP HCM and migrate to SAP HCM for S/4HANA, on-premise

SuccessFactors is the strategic direction. Customers can start their digital transformation with SuccessFactors at any point in time

SAP ERP

S/4HANA

S/4HANA

HCM for S/4

SAP ERP HCM

Business Suite 7 and ERP HCM on the same instance

Business Suite 7 and ERP HCM on a separate instance

SuccessFactors SuccessFactors

SuccessFactors SuccessFactors


What are the transition paths?For SAP S/4HANA customers

S/4HANA customers who run SAP HCM on a separate instance can simply migrate to SAP HCM for S/4HANA, on-premise

S/4HANA customers that run the HCM compatibility packs on their S/4HANA instance will need to carve out SAP HCM and run it on a separate instance

SuccessFactors is the strategic direction. Customers can start their digital transformation with SuccessFactors at any point in time

Status Today

Interim Statusafter

2023/2025

Strategic Direction

SAP HCM on separate instance

SAP S/4HANA

SAP S/4HANA

SAP S/4HANA

SAP HCM

SuccessFactors

HCM for S/4

SuccessFactors

SAP S/4HANA

SAP S/4HANA

SAP S/4HANA

HR CP

SuccessFactors

SuccessFactors

HCM for S/4

HR Compatibility Pack


We encourage all our 15,000 ERP HCM customers to move to SuccessFactors to accelerate their digital HR transformations.

We also recognize that a subset of the ERP HCM customers will desire to run their on-premise environment for the foreseeable future.

In order to continue to support these customers’ needs, we have taken the decision to offer a new HCM on-premise option, “SAP HCM for S/4HANA, on-premise”.

This new solution is planned to be available in January 2023, with maintenance planned until at least 2030.

We see this new solution as a bridge to give additional time to those customers who are not ready to fully move to SuccessFactors.

Customers’ investments will be protected: We will provide migration tools and services to enable an “upgrade-like” migration.

SummarySAP HCM for SAP S/4HANA, on-premise


Timeline

2023

2025

2030Start Sidecar End of CP/

«Non-HANA-HCM»End of

«OP HCM»

Thank you.

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