SAP ERP HCM customers could benefit from an upgrade to ERP 6.0

March 12, 2010 | SAP News | David Velez | 0 Comment

While about half of the 30,000 or so businesses that run SAP’s ERP applications also run the HCM applications, most aren’t using all of the components available to them.

They are turning to third-party vendors, which they think are stronger in recruitment, learning management and performance management, adopting the new functionality particularly in the on-demand model, according to interviews with analysts.

But customers could leverage many of these benefits by upgrading to ERP 6.0, analysts say. This is the platform on which they could deploy Enhancement Package 4, which contains new functionality in talent management, among other areas. Only about half of the ERP customer base has upgraded to ERP 6.0.

“SAP has the basics in place, but it has been losing ground to the niche SaaS vendors,” Gartner research director Thomas Otter said in an email response. “Enhancement Pack 4 will be adequate for some organizations, but many organizations have not yet deployed it. SAP now brings to the table a pretty comprehensive offering, and a lot of the customers could take advantage of the current offering if they’re on the current release.”

The majority of customers are using the core HR functionality — the personnel functions, benefits modules, compensation and payroll. And there have been steady improvements in SAP’s core HCM applications, particularly around the area of talent management, according to Paul Hamerman, vice president and principal analyst at Forrester Research.

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