 Live from Orlando, Florida, it's theCUBE. Covering Sapphire Now. Headlines sponsored by SAP HANA Cloud, the leader in platform as a service. With support from Consolink, the cloud internet company. Now, here are your hosts, John Furrier and Peter Burris. Okay, welcome back everyone. We are here live in Orlando for day three coverage of SAP Sapphire Now. This is theCUBE's SiliconANGLE's flagship program. We go out to the events and extract the signal of the noise. I'm John Furrier, my co-host, Peter Burris. Want to give a shout out to our sponsors who allow us to get down here and bring our crew, SAP HANA Cloud Platform. Consolink, CapChemini, and EMC. Thanks so much for supporting us. Our next guest is David Ledlow, who's the group vice president of solution management at SAP SuccessFactors. Welcome to theCUBE. Thanks, great to be here. First time on theCUBE, now CUBE alumni. SuccessFactors, not your big show here. You get the big show for you guys in Vegas, Success Connect. That's correct. On the 29th of August, get the plug out there for folks who aren't signed up for interested in HR. But certainly a big part of systems of record. HR has known processes, but now with mobile and this Apple relationship, I think you might see some spawns, all kinds of opportunities around service management, role of the employee, role of the mentor, and the bosses, how people are engaging. What is that dynamic? What is the digital transformation for you guys? So I think with HR systems, you don't have to take a step back and say that with HR solutions, technology, they touch nearly, if not everybody, in the organization in some manner. So HR has to maintain information about employees. And there's been a big push over the past few years to enable employees, enable managers to access that information more closely. However, because of that, HR systems have typically much higher thresholds of usability, engagement and such, for the employees that use them. Like how, give an example. So I'll give you a direct example in that when employees come to work on Monday morning, they typically take a step backwards in the business systems they use over the consumer systems they used over the weekend. So the new threshold for business systems. A threshold for the user experience. Exactly. Okay, yeah, yeah, I agree. Yeah, yeah, yeah. Well, yeah, when was the last time you went to work and actually used systems like the... I can't wait to download that HR app. Well, there's also another dynamic I want to get your thoughts on. And this came out certainly of the last few years, most recently in Silicon Valley, the loss is about discrimination and women in tech about managing employees. Has always been kind of an older model and no one loves to do performance reviews, but yet now there's more data around their social graph and their interest graph. And so you're seeing new data things happening where you actually look at someone's performance outside of the manual process. Absolutely. What are some of this trend and how important this might be? So we're fundamentally looking at the performance management, performance review process. I mean, I don't think you can pick up an HR journal today without seeing some kind of headline about kill your performance reviews and you know, performance reviews are a thing of the past. But the bottom line is it's important for companies to know who their top performers are. So it's, we still want to know who they are. It's just the process to get there that's been kind of broken. So to go back to that concept of engagement, if I can do continuous performance, performance management more continuously, if I can facilitate week to week discussions between managers and employees, have those check-ins, have those tracking of achievements and activities, I can get to the end result much more effectively without that dreaded year-end process that really everybody hates about having to scramble and saying- And they mail in the data too. It's just like they're cutting in basic from the other guy. Exactly, exactly, I've done it myself. I mean, send those frantic mails to everybody and I said, okay, well, what did that person do? So I can put it in the performance review. So that's the kind of idea about engagement and leveraging some technology to do a better outreach, I would say, to employees, make it more continuous. Think of the social network type software and solutions that we see. We go there because we want to. And I think- Well, the data is gold, right? I mean, you can actually see who doesn't show up to meetings. Absolutely, that's real data. And I think you can even take that to the next level with some of these things. One of the announcements we did make here at Sapphire was some work that we're doing in diversity and inclusion, which is a huge topic in HR right now. And actually looking at data within the organization and not just promotions, terminations, that kind of thing, but is there subtle unconscious bias in the way that job descriptions are written, in the way that job requisitions for recruiting are written and these kind of things? So actually to take a step back, use all that data, use that machine intelligence to kind of look at the whole thing from an entire perspective, say where are these sources of potential bias? And how do we- That's a big deal actually. That is probably, I think, one of the things that I hear the most of, which is not just a gender issue, but it's also to keep the top performers, you have to enable opportunities for them and match them up properly at the right time. Huge challenge. Exactly. And it is to a company's interest to take a more active role in diversity and inclusion. And there's studies that show this and that if you have a much wider view from multiple ethnicities, gender, whatever it might be, it's good for the company. Your company, your customers are multi-ethnic, multi-gender and you bring in the different points of view of multiple people to, I think, set a much better strategy, set a much better engagement. I mean, people today, millennials, they want to work for a multi-diverse cultural company. Well, historically HR systems have been programs that complied with the letter of the law. That's true. In the past 10, 15 years, we've talked about moving from just HR, which has a narrow view on compensation and employer view and compliance with those laws to trying to think more about talent management. And I know that's where Success Factor was kind of born was the idea that we want to review people but also put in place programs that allow us to develop them better so that we can have a broader quality of individual, including some of the diversity issues. But the SAP ecosystem is starting to, is at least implicitly, if not explicitly, making a promise to customers that through that ecosystem, you will have a better insight and do a better job of managing the assets within your business that create value for your marketplaces. Whatever they are, cash, physical assets, but increasingly employees and partnerships. So is Success Factors being identified as a leader of that charge to find ways or to demonstrate how SAP is going to be able to evolve, to do a better job of helping customers overall drive the quality and returns on those crucial assets that generate market and customer value? Yeah, so I think you said a couple of things. So let me try to get a couple. It's a buffet of results. Yes, it was. Yeah, absolutely. We've seen that trend over the past 15, 20 years of HR systems, what we say typically is going from system or record to system of engagement. But they have to do both as well. I mean, you still have to do employee record keeping. You still have the compliance angle of HR, especially in payroll benefits and that kind of thing. So those systems need to be, I would say, much more efficient, much more effective of what they do, drive out the cost, do things more self-service oriented, use machine intelligence that drives to the complexity out there and let the software take decisions on its own. Then we use that as kind of a foundation to build on some of the more strategic HR things like performance and goals, compensation, recruiting, learning, and whatever it might be. But now we get into an era, I would say, in the future of what does the ecosystem look like? Because we're putting all this stuff in the clouds. So the customers don't have all that on-premise technology that they used to have to be able to say, okay, well, we want to do this unique thing and we want somebody to come in and build this unique application. And I think that's where the HANA Cloud Platform comes in and that's huge for us. I think that what I like to say is, no one company can own a monopoly on innovation. And especially with the low barrier of entry today with regard to cloud technologies and cloud platforms, including HANA Cloud Platform around the world, anybody with a good idea, anybody with something unique that they can bring in, build something very quickly and connect it to an HR assistant, that's huge. That's a great point. And we just talked to the HANA Cloud Platform guys for the service and they got the developer ecosystem booming and the Apple deal certainly is going to be a very intoxicating moment for many people who can see the value in some of these white spaces. Giving an example, I talked to a customer last year, big company, and they're using Workday. Big platform, they obviously went public to doing well, the competitor. Okay, so the guy says, we love Workday but this one employee wrote this bad ass expense report app. That was just so awesome and it didn't fit into Workday and so he shadow IT'd it out in the cloud. And so this is the opportunity that we're seeing a thousand times over, a thousand flowers are blooming in this kind of use case where someone just gets very domain specific and builds a great app. That's the trend. How do you guys fit into that? Is that possible and how would you address that growing trend? Because that might be the case where these white spaces get filled by these amazing use cases. As I said, we can't own a monopoly on innovation. So can you support that? Absolutely, so if we're going to get technical for a minute, the SuccessFactors APIs and services are linked into the HANA Cloud Platform. So we invite partners as well as customers to come in and build unique applications on HANA Cloud Platform. That makes them natively integrated using some of the services from SuccessFactors and now customers have access to all of this innovation and ideas that are going on in the space around them. So they use us for the basic, I shouldn't say basic, but core and more strategic level of processes, information, but then they have access to all of this other, this other integration. So you guys just support a data model where if you have an app already in your portfolio that's comprehensive, certainly integrated in throughout your system and some unique app comes in, fits right in? Absolutely, so they can bring it in just through native APIs or the partner can come in and build something new on HANA Cloud Platform. So both options are available. But yeah, we don't see us as a monolithic single platform. Use our app, stance app is our app is what you do. Exactly, look, I spend 10 years in product management on the SAP side of things. And I can't tell you the long lists of requirements we had. It's like, well, you have to do this and this and this and this and you'll never get to it. It's just not possible. That's your heart. I mean, to get it right as a suite, do your best to be comprehensive but you got to be iterative, you got to be always updating, but there's going to be scenarios where people are going to do a really interesting tool or point solution that just is great. Spot on, yeah, exactly. And it's not a standalone venture, maybe. They might not get the zillion downloads. So it's not consumer because they won't get the download support on the iTunes Store, so they have to fit in with the data. That's the key. Yeah, yeah, exactly. It does have to logically link to some of the stuff. It has to consume major data, so I need employee data. I may need organizational structures, but that's really the starting point. So my next question for you is kind of a high level global question. Take a step back, lean back and kind of dream a little bit. Help me dice out the future of work narrative. It's a bumper sticker everyone's talking about. The future of work and collaboration software, what's really going on? What is the real change that's the most relevant around this notion of future of work and share your thoughts on that? Spend a minute to dig into it. Sure, I think, yeah, and we've actually done some research with an organization called Oxford Economics to do some surveys, global surveys on this. I think the future of work is, it's all about digital. There's all of these digital technologies coming in. There's change and technology change happening faster and faster and faster. One of the surveys that we did looked at, we surveyed employees, and so what is your number one concern at work? And the number one answer, 40% all employees said obsolescence was their key fear. And I think that that speaks to this fast pace of change in that we have to keep employees learning. We have to continue to provide education programs so that they feel upskilled. They have those opportunities. They know where the company's going and what they'll need to be relevant to the company. And I think this ties into the- Is that the number one issue? Top performance. It's one of the big issues that we see. I would say from the employee perspective of what they're concerned about. From a company perspective, it is all about digital. It's how am I going to use mobile technology? How am I going to get around the security challenges with some of that? HR data is sensitive, so you may need to be careful. How am I going to use insight, analytics, machine learning? And how am I going to build this ecosystem as well? There is a tremendous amount of digital technology coming into HR. And I think this is what a lot of companies are looking at is how are we going to leverage this stuff most effectively to make the employees, the managers, the executives, lives easier and more informed? So if you think about it, then ultimately what we're talking about is part of a big part of your mission is to help companies make their employees more productive. By doing a better job of identifying the strongest ones, putting them in positions of continued success, identifying folks that have more potential and you could get more out of. The overall, any business is a community, helping management and employees understand how that community is set up and ultimately how that whole thing can be better applied to serve customers. I don't think I could have said it better myself. So it is all about engagement. It's all about employees feeling what we call all in. I mean, really committed to the cause and the objectives of the organization. And I think feeling included. So I think that's where the diversity and inclusion comes in as well. You said it very well. I think it's all part of the community and us as a community with a common goal to advance the objectives and strategies of the organization. So do you need the number one priority for you guys? Big priority. Not number one. But a big part of the plan. Well, every business is seeking to expose the appropriate elements of its employee communities to its customer and market communities. And doing a better job of that is absolutely essential to increasing not only overall productivity, but employee satisfaction or employee engagement, but also customer satisfaction. Because we could talk about computing and machine learning, but at the end of the day, more often than not, somebody somewhere is asking a human being a question and that human being is either making that person happy or not. You're absolutely right, yeah. So that's incredibly important going forward in business. Automation is going to help, but automation is not going to solve everything. Look, you're right. I mean, it's like technology isn't an abler. It's not the strategy itself. So you need a strategy first. Technology will help you enable the implementation of that strategy. And I think that's a big question. Yeah, I totally agree. As we get more automation, what are people going to do? And SAP has to be able to support customers where they are in that continuum. Also provides some thought leadership on it, but is, and I think this is a mission of SuccessFactors and this is the question, SuccessFactors has to be a technology and solution set that helps companies find those appropriate lines. Yeah, absolutely right. So that is one of the key focus areas of what we do is enable organizations to find those employees, to develop the employees, to engage the employees on an ongoing basis. And to your point about what is it we're looking at, I think the importance of information, the importance, and it's not just information, I used to word intelligence. It's actually taking information and packaging it, discovering things through machine intelligence, artificial intelligence, whatever it might be and turning it around and making, don't just throw data at somebody, make a recommendation for them. You know, think of learning, you know, somebody puts in. I think the, I mean, I agree with you, I think the analog aspect of HR has been codified with systems and now we're looking at a pure end-to-end digital. Absolutely. And that's different, that's outside in, that's not, okay, here's what employees should be doing. Managers, here's how you talk to employees. Now it's a complete non-linear equation of, hey, the employees are driving it too. Exactly, I mean, typically I've got a very linear process. I go from, you know, something happens, I have step A, step B, step C, step D, but what if we could bring in machine intelligence into some of this and saying, you know what? Yeah, you go through D, but maybe you want to do E, F and G as well, based on the experiences of others. Yeah, other people did this, maybe you want to do it as well, you know, think of online buying and that kind of thing. I know what other people did, it knows what other people did, and it gives me those recommendations. But it's generating options for those people. Absolutely. David, I wish we had more time to talk about this and hopefully maybe check out your event. This is a great topic. We can go all day long on what IT is going to be because if you have all the systems of record, why aren't you running IT? So it's a whole nother conversation. I don't want, it's a half hour segment, just in itself, it's my vision. I see that being the case. I'm sure you're probably running IT too with all that data on people and their IDs and everything. So I do want to say, I give you a chance to give a plug for the event real quick to end the segment. You keep coming up. Yeah, Success Connect, Las Vegas, the 29th of August through the 31st. Everything there is, everybody wonders to know about HR and success factors, how to make them move to the cloud, learn a little bit about success factors. What's your theme? Our theme is overall success is simply human. Okay, success factors. Being successful on theCUBE here. Top performer, David, thanks for joining us. Welcome to theCUBE alumni. I'm John Furrier, Peter Burst. We'll be right back. You're watching theCUBE.