SAP co-CEO Bill McDermott (Image via Wikipedia)
Within its 176,000 customers around the globe, SAP has the far-flung potential to touch each of the 500 million people who work for those companies.
But with the planned acquisition of SuccessFactors, that potential addressable market of users could double to 1 billion people due to the near-universal relevance among employees of SuccessFactors’ cloud-based applications, SAP co-CEO Bill McDermott said yesterday. (For an in-depth look at SuccessFactors, please check out SAP Seeds the Cloud with Blockbuster SuccessFactors Deal.)
On a conference call with analysts, McDermott said that SuccessFactors’ Human Capital Management solutions are applicable every employee in every company—“from the boardroom to the mailroom” and “from the CEO to the custodian”—offering the potential for the reach of SAP’s products to be extended far beyond its already-huge universe of business and technology users.
In another call with analysts two days earlier, McDermott offered this assessment of the powerful synergy between SAP and SuccessFactors, which buttresses SAP’s contention that the acquisition will dramatically shift the balance of power in the world of cloud-based business applications.
“In fact, by 2015 we expect about 80% of these [HCM] applications to be in the cloud,” McDermott said.
“So the combination of this as [SAP CFO Werner Brandt] said not only gives us the 500 million addressable audience in the SAP install base, but there’s another 500 million users that are outside of the SAP install base that we intend to initiate as well for a total of one billion addressable people in the open market place that we’d like to see have this application on their desktop or their device.”
Now, clearly, there’s a big difference between a potential universe of 1 billion users and the ultimate conversion of big chunks of them into users of HCM solutions from SAP and/or SuccessFactors.
But more significantly, McDermott’s statement reveals the massive scalability of some new and even next-generation cloud-based HCM products that will be used regularly—perhaps even daily—by many tens of millions of even hundreds of millions of people.
In fact, in the same conference call, McDermott underscored SuccessFactors’ unmatched ability to scale across big numbers of users and indicated that the company has 5 times more subsribed seats than any other cloud-based business-software competitor:
“Together, with SuccessFactors’ widely respected team and its deep experience in building and bringing to market scalable cloud solutions, we see tremendous upside to create new business opportunities,” McDermott said.
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