Enabling your Globalization Mandate · eSocial in Brazil, RTI in UK, ELStAM in Germany and N4DS in France 1) Based on the number of legal changes addressed by SAP localization services

Enabling your Globalization Mandate

A Point of View on the Value of SuccessFactors’ Localization Capabilities

2©SAP CONFIDENTIAL 2015

MARKET

ECONOMIC

TECHNOLOGICAL

Shift FROM ‘Developed West vs. Developing

East’ TO Multipolar Talent Market

Growing availability of GLOBAL TALENT

allows for low-cost global production strategies

Low cost systems should support

employees’ GLOBAL COLLABORATION

Supporting LOCAL HR rules EVERYWHERE

(East & West) is now table stakes

HR solutions should be able to attract & develop

TALENT in DIFFERENT production regions

Need for systems that SCALE GLOBALLY,

while addressing LOCAL employee needs

Driver Globalization Mandate HR Localization Implication

Globalization mandates are driving a growing need to address HR

localization requirements,…


…however, increasing local regulatory and legislative complexities

are prohibiting companies’ ability to address such requirements

1,279

1,1431,232

985

20132011 2012

+9%

2014

Growing Number of Legal & Regulatory Changes1)

(2011-2014)

Local government regulatory changes are growing

significantly globally, increasing the burden of

addressing local HR related statutory and

compliance changes1)

Government ‘Electronification’ strategies are

driving a move away from paper-based statutory

reports towards real-time electronic communication;

the transition is adding a layer of complexity to

addressing local HR requirements. Cases in point:

eSocial in Brazil, RTI in UK, ELStAM in Germany and

N4DS in France

1) Based on the number of legal changes addressed by SAP localization services in 61 countries; SAP Industry Value Engineering analysis

Note: Provided numbers are estimates that do not warrant the accuracy or completeness of the information contained w


SuccessFactors anchored ‘HR Localization’ at the center of its

offering, allowing you to focus on your core business

Some HR Cloud solutions support HR localization in limited # of countries, SuccessFactors coverage is unmatched

Localization

Value Cycle

1. Enabling the Localization of HR Systems

in Customers’ Countries of Operations

2. Addressing On-going

Legal Changes

3. Avoiding Non-compliance Legal Risk and

Related Financial Implications

General availability in 74 countries

120 local product managers, 310 Engineers to

support continual country / regional compliance.

>4,600 legal changes addressed in the last 4 Yrs

Managing processes for 177 countries;

documentation translated to 40 languages

Close partnerships with local governments

Global processes & local best practices for

business process standardization on a single DB

1,300+ product experts

SuccessFactors Localization Value Cycle

Source: SAP Solution Experts; SAP Industry Value Engineering analysis


Truly Global CoverageSupported predefined localizations for Employee Central

1. Argentina

2. Australia

3. Austria

4. Belgium

5. Brazil

6. Bulgaria

7. Canada

8. Chile

9. China

10. Colombia

11. Costa Rica

12. Croatia

13. Czech Republic

14. Denmark

15. Dominican Republic

16. Ecuador

17. Egypt

18. Finland

19. France

20. Germany

21. Greece

22. Guatemala

23. Hong Kong

24. Honduras

26. Hungary

26. India

27. Indonesia

28. Ireland

29. Israel

30. Italy

31. Japan

32. Jordan

33. Kazakhstan

34. Kenya

35. Kosovo

36. Lebanon

37.. Malaysia

38. Mexico

39. New Zealand

40. Nigeria

41. Norway

42. Pakistan

43. Panama

44. Peru

45. Philippines

46. Poland

47. Portugal

48. Puerto Rico

49. Qatar

50. Romania

51. Russia

52. Saudi Arabia

53. Serbia

54. Singapore

55. Slovakia

56. Slovenia

57. South Africa

58. South Korea

59. South Sudan

60. Spain

61. Sweden

62. Switzerland

63. Taiwan

64. Thailand

65. Netherlands

66. Turkey

67. Ukraine

68. United Arab Emirates

69. U.K.

70. U.S.A.

71. Uruguay

72. Venezuela

73. Vietnam

74. Bangladesh

75. Nicaragua


Truly Global CoverageSupported Localizations for Employee Central Payroll

1. Argentina

2. Australia

3. Austria

4. Brazil

5. Canada

6. Chile

7. China

8. Colombia

9. Finland

10. France

11. Germany

12. Hong Kong

13. India

14. Ireland

15. Italy

16. Japan

17. Malaysia

18. Mexico

19. Netherlands

20. New Zealand

21. Russia

22. Saudi Arabia

23. Singapore

24. South Korea

25. Spain

26. Sweden

27. Switzerland

28. U.K.

29. U.S.A.

30. Venezuela


First, we need to distinguish between ‘Global Capabilities’, and

‘Localization Capabilities’ that are unique to SuccessFactors

Localization Capabilities

Initial LocalizationInternationalization On-Going Maintenance

Global Capabilities

The ability to use the solution in any country Creating and maintaining local legal requirements and

delivering it as part of the solution

Translation

Application language is

translated so it can be

accessed by users in their

native language

Local regulations and local

business best practices are

researched and analyzed to

create unique specifications

in the software for each

country

Application is configured to

support different country

specifications for time

zones, currencies and

some configurable fields

(addresses, phone)

Legal changes are

monitored and legislations

are interpreted using

network of legal advisors,

government authorities and

local officials to translate

changes into the software

via defined product mgmt.

and development process

Features Offered by most HCM vendors,

including SuccessFactors

Features only offered

by SuccessFactors

Being global does not mean supporting localization – only SuccessFactors ensures global and local compliance in

over 70 countries as a matter of standard practice



Country-

specific Fields

Validation Rules Compliance

Reporting

Country-specific

Business Rules

Integrations to

Local Providers &

Authorities

Global Payroll

Engine with Local

Payroll Rules

EEO1 (USA) Check sum

Validation for

SSN

EEO1/VETS-

100/A Reports

(USA)

Russia: All

communication about

leave must be in Russian

Benefits Vendors Net pay must be a

minimum of 25% of

gross pay (USA)

Tariff Code

(DEU)

ABA Routing

Number/IBAN

Code Validation

First Day

Notification

India: Continuously

employed contractors

deemed employees; Alert

needed for HR/Mgr

Electronic

Transmission to Gov

for Employment

Equity Report (CAN)

Gratuity pay is 15 /26

of last monthly salary

for every completed

yr of service (INDIA)

Date of First

Entry (FRA)

Address

Validation

Northern

Ireland Fair

Employment

Report

In California it is illegal to

have a “use it or lose it”

leave balance

Stock Vendors Superannuation rules

(AUS)

Account for Local Business Practices, Legal Requirements & Statutory Reporting

Sample of HR Localization (1/2)

LOCALIZATION



Sample of HR Localization (2/2)



Sample of Addressed Local HR Changes (1/2)



Non-compliance was avoided in Brazil as SuccessFactors’ team worked directly with

regulators to ensure compliance while other vendors struggled to meet requirements

In 2013, Brazil legislators began the

largest legal change in HR history

to modernize the country’s

employment related records, known

as eSocial

SuccessFactors collaborated

with the Brazilian Government to

define the legal requirements

In doing so, SuccessFactors was

able to influence the legislation

and had a significant head start

While other vendors struggled to

interpret the new regulations,

SuccessFactors had already

conducted usability tests with 40

Brazilian customers

Situation Action Result

Sample of Addressed Local HR Changes (2/2)



More importantly, failing to comply with local requirements could

result in significant damages: reputational, legal, financial,…

More lawsuits over misclassification of

employees

More lawsuits in regional courts to attack

multinationals in more favorable local venues

More lawsuits over classification and rights of

independent contractors

More lawsuits over pension plans

More lawsuits over employment equality

Cost of Non-Compliance Legal Trends in HR Compliance

Civil LitigationGovernment

Action

Agency Fines &

Sanctions

Damage to

ReputationBad Press

Loss of

Culture

Foregone Business Opportunities

$1.5

Billion

Paid by companies to employment equity, pension and

health plan enforcement in the United States alone in

2014

Source: ‘Employers to Face More Litigation in 2015 As Plaintiff Lawyers Swoop In’, Fisher, Daniel. Forbes. 26 January 2015; SAP Industry Value Engineering analysis


…as was the case with several multinational organizations; with

SuccessFactors, you can avoid such non-compliance cases

Cases in Point: I-9 Paperwork Violations (Employment Eligibility)

Background Information:

• Form I-9 is used to verify the identity and employment authorization of individuals hired for employment

in the United States

Increased Scrutiny:

• Audits of I-9 forms have increased from 250 in 2007 to more than 3,000 in 2012, an 1100% increase

over a five-year period

Source: ICE Factsheets http://www.ice.gov/news/library/factsheets/i9-inspection.htm, US Immigration and Customs http://www.ice.gov/news/releases/abercrombie-and-fitch-fined-after-

i-9-audit, I-9 Compliance https://www.lorman.com/resources/i-9-compliance-avoiding-the-violation-of-employee-rights-and-irca-penalties-15416, DOJ I-9 Fines

http://www.lawlogix.com/blog/doj-announces-biggest-i9-fines-ever-34million; SAP IVE Industry Value Engineering analysis

Fined ~$1M in 2010 related to

the obligation to verify the

employment eligibility of its

workforce

Fined $395K in 2007 related to

paperwork violations and

employment irregularities

Fined ~$34M IN 2013 for failure

to maintain I-9 records for its

foreign nationals in the US in

2010-11


In Summary, localization is just one of the many unique capabilities

you will have by partnering with SFSF: The World’s HR SW Leader

LocalizationLocalization in over 70 countries. Regulatory compliance is assured by

dedicated SAP resources that keep our clients current in their operating

geographies. With your globalization mandate, the time, effort and cost

required to emulate this would be significant

ModularitySAP will not proscribe a deployment methodology, you can address

your most pressing needs in order of their urgency, which can be the

core but doesn’t need to be

IntegrationTight, productized integration with key strategic partners, i.e. ADP and

Workforce

Holistic PartnershipSAP offers a fully supported path forward not only for HR

standardization, but also into the other areas of your business

ConfigurationSuccessFactors has unparalleled configuration capability and platform

extensibility. SuccessFactors gives you the ability to create entirely new

functionality as required by the many operating units worldwide

AnalyticsSuccessFactors offers unmatched full data agnostic analytics and

predictive modelling capabilities that will enable HR, Finance and IT full

workforce planning capabilities

Brining it All Together – Why SuccessFactors is the Right Choice for you


We are Truly Global ….

…. We Will Enable your Globalization Mandate ….

…. at a Lower Cost of Ownership and Mitigated Risks

SuccessFactors: We Help you Stay Safe


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illustrate value estimates.

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and assumptions that are subject to change. These materials present illustrations of potential performance and cost savings,

and do not guaranty future results, performance or cost savings. The materials are provided solely for internal review and

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Documents

Enabling your Globalization Mandate · eSocial in Brazil, RTI in UK, ELStAM in Germany and N4DS in France 1) Based on the number of legal changes addressed by SAP localization services