A Look Into Tackling Digital Transformation with SAP’s Yvette Cameron and Mark Brandau

HR 2017 Keynote Recap: SAP’s Yvette Cameron and Mark Brandau Offer Guidance for the Road to Digital Transformation

In his opening remarks at HR 2017, Rizal Ahmed, chief content officer at Wellesley Information Services, told the audience about his experience with his 16-year-old daughter who is just learning to drive. His daughter got in the car and started it before opening the garage door. His daughter had tunnel vision and did not fully understand her surroundings. Unawareness — while driving or competing in the business world — ends up with catastrophic results.

My take on Riz’s situation is that it is too bad that his car was not equipped with a sensor that would not allow the car to move with the garage door closed. Having that sensor would have changed everything. That sensor is also an example of how digital technology is transforming an industry (in this case the automobile industry) and moving it a step farther along the road to digital transformation.

That theme of making sure you are aware of your environment and what is going on in it as industries move closer toward digital transformation was repeated in the HR 2017 keynote address. In one point in the keynote address at HR 2017, Yvette Cameron, senior vice president of strategy and corporate development at SAP SuccessFactors, stated that digital disruption is affecting everything today.

When Cameron spoke about digital transformation at the keynote presentation at HR 2016, she talked about it looming on the horizon and said that HR professionals and HR IT leaders “needed to rethink the ‘I’ in IT.” She told the audience to rethink about innovation, integration and infrastructure to redefine their roles in their organizations.

This year, Cameron stressed that “digital transformation is affecting us today; it’s no longer something that’s on the horizon.”

Her presentation this year included three main topics:

• Digital disruption coming into HR
• What’s required to succeed in this transformational environment?
• Where do we start?

She started right away with a poll question: Which of the following are deployed in the cloud today for some or all of your workforce (select all that apply)?

• Recruiting
• Performance Management
• Learning Management
• None of HCM

Performance Management ended up as the leading application deployed in the cloud, followed by Learning Management and Recruiting. However, about 34 percent of the attendees’ responses revealed that their organizations have not deployed any HCM applications in the cloud.

At this point Cameron echoed Hans Thalbauer’s comments in the SCM 2017 keynote when she stated that during the last 30 years, she has never seen so much transformation at the fundamental route of how business is conducted as she has in the last three years. The use of business intelligence, mobile technology, big data, and Internet of Things (IoT) is unlike anything she has seen in the last 15 years.

She added that “digital disruption is upon us today” and that it’s affecting everything.

Digital Disruption Paves a Path for New Competitors

Cameron stated that digital disruption is changing the nature of competition and fostering the emergence of new competitors that were not heard of before.

She stated that the nature of work is changing and companies that don’t keep pace with change — or at least be prepared for it — run the risk of not only falling behind but also becoming obsolete. To underscore this comment she spoke about three examples:

• Kodak — Kodak fell from being the market leader in the 1970s to going bankrupt in 2012 after failing to embrace the industry’s move from film to digital cameras.
• Blockbuster — Blockbuster became a victim of the growth of video on demand. Blockbuster had an opportunity to buy Netflix, but didn’t. It filed for bankruptcy in 2010.
• Borders Books — Borders failed to recognize that it was imperative to move its business to the web (e-commerce) and failed to anticipate the growth of e-books. It also invested in selling music packaged as CDs at the time when the iPod was emerging in the market.

Her advice: “You don’t want to be the roadkill in the digital transformation story.”

How Do You Keep Pace with Digital Transformation? What Do We Do?

Cameron stated that organizations should focus on what some of the drivers and challenges of digital transformation are. She added that digital transformation is not about automation. When digital transformation is driven solely by IT organizations, the focus is primarily on cost reduction and efficiency. According to Cameron, that’s not enough. She stressed that you need to rethink processes and think about smarter ways to leverage the technology to conduct business in your organization.

Her next point was that the emergence of smarter technologies, such as personal assistants, self-driving cars, drones, and wearables, is affecting future jobs. To amplify this point she stated that by 2035 approximately 45 percent of all US jobs will be threatened by automation.

Automation replaces some jobs, but creates others. For example, workers who climb ladders to inspect and repair equipment on an oil rig are being replaced by drones. This change creates a need for skilled drone operators.

HR Leaders

Cameron started her discussion on HR leaders by stating that if “we are going to drive innovation into our organizations and if we are going to engender communication and engagement, we need to organize our businesses in a way that is natural and reflective of how work gets done.”

The traditional organization models don’t work anymore. Some other points she made included:

• Siloed processes inhibit cross-business collaboration
• The org chart should be a collaboration— the org chart is transformed to a network of teams
• You should be moving toward a more agile, flatter structure in your organization

Cultural and Technological Changes

Cameron started her discussion of this topic by referring to “all-in employees” (i.e., highly engaged employees). She cited a Gallup poll that found that about 31 or 32 percent were engaged. The others were disengaged or actively disengaged.

How do you foster a culture to encourage more employee engagement, communication, and collaboration? According to Cameron, an organization should use surveys, analytics, sentiment analysis, feedback, peer recognition, mentoring, and coaching.

Cameron’s next point was that enabling technologies can work for you or against you. She said that “in today’s environment, you need to manage actively the culture of your organization because the technology is there to both enhance it as well as bring down the employer brand or the value of the brand based on that openness and transparency.”

Digital Transformation: What’s Next, What’s Possible?

Cameron compared the transactional recruiting, developing future talent, and leveraging future talent with transformational processes for these three processes.

Another poll asked attendees where they think they stand on a scale of 1–7 (1 being transactional and 7 being transformational) with regard to their HR organization’s processes. Most attendees were at a level of 3 followed by 4 and 1.

Digital Winners

A survey conducted by SAP SuccessFactors and Oxford Economics of about 2,100 executives revealed the following findings about what they thought it took to be a digital winner. According to the survey, digital winners:

• Embrace digital technologies
• Streamline decision making
• Flatten the organization (take out complexity)
• Build a digital workforce

Digital winners have more mature talent management processes.

Only about 16 percent of the respondents to the Oxford Economics survey thought their organization displayed these characteristics. Digital winners show strong revenue and profit growth, have employees who are more satisfied, and have a higher retention rate (employees are more likely to stay in their jobs).

Cameron closed by displaying the following quote by business author and coach Marshall Goldsmith: “What got you here, won’t get you there.”

The market is changing constantly, so we need to be constantly monitoring the marketplace and monitoring the actions of competitors so that you don’t become too comfortable with success and miss the next wave of innovation.

To ensure you remain a digital winner, you have to focus on the right behaviors. Cameron again cited the Oxford Economics study that revealed that 46 percent of companies devote resources to developing future leaders, and only 55 percent indicated that they make their decisions based on data.

What Are Vendors Doing? What Should You Ask Vendors to Do?

Mark Brandau, vice president of solution management at SAP SuccessFactors, took the stage to explain what SAP is doing as a vendor to help companies become digital winners. He cited three concepts that are prerequisites:

• Engaging — Continue usage to improve everyday work life
• Intelligent — Data-based suggestions, recommendations, and guidance
• Connected — Extended HCM solutions with more tools to help

Brandau stated that when you start to apply these concepts you can solve many business challenges in new ways. For example, you can have a workforce that is more diverse. He added that “when you have a more diverse and inclusive workforce there is increased diversity of thinking and innovation and that gives you competitive advantage.”

How Can Managers Use Engagement to Improve Everyday Worklife?

Brandau started his discussion of this topic by playing a video of how Continuous Performance Management provides an immediate view into the progress an employee is making. Brandau mentioned that the video displayed the use of a lot of mobile technology, and he then referred to SAP’s announcement last year about its partnership with Apple and talked about three areas SAP is focusing on with Apple:

• Redesigning dedicated IOS app
• Redesigning processes
• Data — Mobile devices and wearables generate a lot of data

He referred to tracking steps used for to foster health and wellness in the organization.

Cameron said that SAP is looking at creating indices to measure the health of an organization. As an example, Cameron referred to SAP’s Business Health Culture Index, which provides an analysis of seven levers (cost of health claims, employee feedback from surveys) that can be manipulated to create a consolidated index to track the movement of the health of an organization.

Cameron said that a one-percentage point change in this index can affect SAP’s operating profit by 75 million to 85 million euros per point.

Brandau ask the audience to pause for a second to consider the following comment made by John Glenn in 1962 while he was in a Mercury space capsule (Friendship 7) waiting to launch: “Get the girl to check the numbers.”

Brandau stated that Glenn and the NASA team were checking data generated from mainframe computers about trajectory and reentry. Glenn was referring to Katherine Johnson, an African American woman who a member of NASA’s team. Brandau’s point was that Glenn did not trust the computers and wanted a person to run the numbers. He said HR has an opportunity to lead by embracing the numbers. Brandau added that trust, respect, and pride are human characteristics, and when push comes to shove, people will trust people. “If people are the engine to this digital transformation, data is the fuel.”

How Is SAP Helping with Digital Transformation?

Brandau said SAP is helping organizations transfer data into intelligence in three major ways:

• Embedded
• Analytics apps
• Workforce planning

Brandau said that in the first quarter of 2017, SAP announced integration between workforce analytics and BusinessObjects Cloud and the SAP Digital Boardroom. According to Cameron, this integration provides a direct connection to analyze SAP SuccessFactors data (KPIs and metrics) in an enterprise BI environment.

He then played a video demonstrating SAP Insight, an SAP SuccessFactors panel that provides answers to common questions about recruiting, performance reviews, compensation, and succession planning.

Intelligent Services

The next topic Brandau discussed was Intelligent Services. Brandau said Intelligent Services are an example of a transformative technology. He said SAP has processed approximately more than 40 million events through Intelligent Services across its customers. New in the first quarter of 2017, SAP announced the Intelligent Services Center, which facilitates the editing, configuring, managing, and monitoring of service events.

Brandau stated that Intelligent Services enables organizations to connect to other software and tools. For example, if someone requests time off in SuccessFactors (an out-of-office event), Intelligent Services triggers an out-of-office reply and prompt to reschedule a meeting in Office 365.

Brandau added that 65 percent of Employee Central users extend and connect Employee Central. He said there are two key ways to extend Employee Central:

• Extension Center — a business analyst’s tool (create new fields such as a car lease)
• SAP Cloud Platform — use it to build and access new applications

According to Brandau, SAP Cloud Platform provides the following features to organizations:

• A development environment — you can develop your own app
• SAP SuccessFactors APIs — you can connect apps to SuccessFactors
• An Application Container — storage management for apps
• SAP SuccessFactors App Center — extensions and thousands of apps available, including numerous ones for HR (e.g., JobPts Appreciate for rewards and recognition; SAP Alumni, a third-party app)

Convergence of Marketing with HR

Brandau then asked where is SAP now with regard to HR? What’s coming? Cameron said that “the future is happening today.” The focus of applications is no longer on HR efficiencies, but rather on people. Your focus should be on delivering people-centric applications.

Cameron commented on convergence of marketing applications and HCM applications (for example, in recruiting). She also mentioned higher user of analytics and leveraging networks.

Cameron stated that there’s a lot of activity focused on improving the experience and the support that SAP provides for individuals in organizations.

Brandau stated that the SAP Learning Marketplace consists of SAP Hybris and SuccessFactors Learning Management System (LMS). According to Brandau, this solution helps transform learning for an organization’s customers. He said that if you extend learning to either a customer or a partner, you can increase revenue per employee by 40 percent. If you extend learning to both customers and partners, you can increase revenue per employee by 100 percent.

A final poll asked attendees where their organization is with regard to extending learning outside of their organization. More attendees (around 49 percent) said that they are currently extending learning, but several also said they are not doing it (around 46 percent).

Making the Case for Your Transformation Journey

Brandau said that you should quantify the business benefits when considering your approach to moving toward transformation. He said that “you can’t cut your way to transformation.”

He said, however, that you can cut the “insidious cost of learning,” such as spending on content for learning. He mentioned that SAP spent approximately 2.3 million euros per year on content for learning in 2013, but reduced its content license spending by 85 percent in 2015.

After running a demo of how Sunpower transformed it HR operations so that HR was enabling employees but not getting in the way, Brandau and Cameron listed three key takeaways:

• Question everything — Digital transformation is not about automation; it is about rethinking processes and challenging the way you do work; focus on ways to gain efficiencies to increase innovation and get the best results for your organization.
• Know your numbers — You owe it to your business to know your data.
• Seize a unique opportunity — The window is closing; don’t be left out. Don’t wait for the dust to settle; the dust will never settle.