Overview of SAP HCM for SAP S/4HANA Release 2022

Overview of SAP HCM for SAP S/4HANA Release 2022

Introduction

SAP Human Capital Management (HCM) is an essential part of enterprise resource planning, enabling organizations to manage their workforce efficiently. With the introduction of SAP HCM for SAP S/4HANA in the 2022 release, SAP has provided a pathway for organizations to transition seamlessly from previous HCM implementations. This article will delve into the key aspects of this transition, the scenarios it covers, and the simplifications introduced.

What is SAP HCM for SAP S/4HANA?

SAP HCM for SAP S/4HANA is an advanced iteration of the traditional SAP HCM, tailored specifically for SAP S/4HANA environments. Unlike its predecessors, this version integrates deeply with the SAP S/4HANA architecture, leveraging the benefits of SAP’s in-memory database and real-time analytics capabilities. The transition to SAP HCM for SAP S/4HANA is designed to be seamless and non-disruptive, with a focus on maintaining continuity for existing SAP HCM users.

Transition Scenarios

The SAP Note outlines three key scenarios for organizations planning to transition to SAP HCM for SAP S/4HANA:

1. Scenario 1: Target SAP HCM for SAP S/4HANA in SAP S/4HANA 2022 and Beyond

   • System Conversion: Organizations upgrading to SAP S/4HANA 2022 from an earlier release and wishing to utilize SAP HCM for SAP S/4HANA will undergo a system conversion. This process includes migrating from previous SAP HCM implementations to the new SAP HCM for SAP S/4HANA.
   • System Upgrade: Companies currently using SAP HCM in a compatibility scope within earlier SAP S/4HANA releases will upgrade to SAP S/4HANA 2022. This upgrade allows them to continue using SAP HCM within the new S/4HANA environment.

2. Scenario 2: Target SAP HCM Compatibility Pack in SAP S/4HANA 2022 and Beyond

   • This scenario is for organizations that wish to maintain their current SAP HCM functionalities without moving entirely to the new SAP HCM for SAP S/4HANA. Here, companies can either convert or upgrade their systems to SAP S/4HANA 2022, continuing to use SAP HCM within a compatibility scope.

3. Scenario 3: Target SAP HCM in RISE with SAP S/4HANA Cloud, Private Edition

   • For companies using SAP S/4HANA Cloud, Private Edition under the RISE with SAP offering, this scenario supports both system conversions and upgrades. This ensures that subscribed SAP HCM functionalities are available within the cloud environment.

Simplifications and Impact on Existing Functionalities

SAP has introduced a series of simplifications in SAP HCM for SAP S/4HANA, which are part of SAP’s broader "principle of one" strategy. This strategy aims to streamline processes by removing redundant functionalities and focusing on core processes that deliver the most value.

The simplifications can affect different sub-components of SAP HCM. These changes are particularly relevant for organizations planning a system conversion or upgrade, as they may require adaptation to alternative solutions or processes.

Key Simplifications:

• Appraisal Systems (PA-PD-AP): This functionality is now simplified, with alternatives like Objective Settings & Appraisals (PA-PD-PM) or SAP SuccessFactors Performance & Goals being recommended.
• Compensation Management (PA-CM): Enterprise Compensation Management (PA-EC) or SAP SuccessFactors Compensation are suggested alternatives.
• Time Management (PT): Certain time management functionalities, including Time Data Recording and Management and Time Evaluation, have been streamlined. Infotypes and operations affected by these changes must be reviewed, and organizations should consider alternatives like IT2006 'Absence Quotas' and IT0416 'Time Quota Compensation.'

These simplifications are documented in a table format in the SAP Note, providing detailed information on which functionalities are affected, the status of these changes, and suggested alternatives. Organizations are encouraged to perform a thorough review using tools like the SAP Readiness Check and the SAP Simplification Item Catalog to identify how these changes will impact their specific configuration.

The Role of Business Functions in SAP HCM for SAP S/4HANA

One critical aspect of transitioning to SAP HCM for SAP S/4HANA is the activation of specific business functions. Particularly, the H4S4_1 Business Function, which is essential for enabling the new SAP HCM features within SAP S/4HANA. Starting with SAP S/4HANA 2025, this business function will be automatically enabled. Organizations planning to upgrade before this should carefully consider the implications and review relevant SAP Notes, such as SAP Note 3443536, to understand the necessary steps.

Considerations for SAP HCM in RISE with SAP S/4HANA Cloud, Private Edition

For organizations using RISE with SAP S/4HANA Cloud, Private Edition, certain SAP HCM functionalities are not part of the offering. Key sub-components like SAP E-Recruiting and SAP Learning Solution (PE-LSO) require alternative solutions, such as SAP SuccessFactors Recruiting and SAP SuccessFactors Learning. Additionally, various Talent Management solutions are streamlined, with alternatives provided through SAP SuccessFactors modules.

Recommendations for Organizations

• Assess the Impact: Before proceeding with a system conversion or upgrade, organizations should conduct a thorough assessment using the SAP Readiness Check and the SAP Simplification Item Catalog. This will help identify which functionalities will be affected and what alternatives are available.
• Review SAP Notes: Regularly review the relevant SAP Notes, as these documents are subject to updates and enhancements. Staying informed will ensure that organizations can adapt to new information and recommendations promptly.
• Plan for Activation of Business Functions: Ensure that the necessary business functions, such as H4S4_1, are activated to fully leverage the capabilities of SAP HCM for SAP S/4HANA.

Conclusion

The transition to SAP HCM for SAP S/4HANA presents a significant opportunity for organizations to modernize their HCM processes within the robust SAP S/4HANA environment. By understanding the scenarios, simplifications, and necessary actions outlined in this SAP Note, organizations can ensure a smooth and efficient transition, unlocking the full potential of their HCM systems in the process.