Salesforce's Work dot com logo, an example of HCM from the company
Salesforce's Work dot com logo, an example of HCM from the company

Is Salesforce Going to War with Oracle, Workday, SAP in HR?

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Like a crafty magician drawing focus to the left hand while the right one stirs up mischief, Salesforce CEO Marc Benioff has been preaching for 2 years that Salesforce is not getting into HR even as it’s clearly been getting into HR.

On my weekly Cloud Wars Top 10 rankings, Salesforce is #4 while SAP is #5, Oracle is #6 and Workday is #9.

Two years ago this month, I posted an article called Attention Workday, SAP and Oracle: Is Salesforce Jumping into HCM? in which Benioff described how excited he was about jumping into what was then the fast-emerging category of employee experience moments before he insisted that employee experience is not part of HCM. 

As I laid out in that article, during a May 2019 earnings call, Benioff first said this:

“And now Southwest [Airlines] is really turning to employee experience. So they’re using our Communities product and Service Cloud and a centralized HR help desk to enable their 60,000 employees to check benefits, manage rotation time, and ask questions via chat.”

And a moment later he said this—and if after reading this you’re not confused, you probably should be:

“I don’t want anyone to think in any way that this means we’re going into HRMS or anything like that,” Benioff insisted. “Instead, this is something that very much enhances the customer experience and also the employee experience and strengthens the intersection between employees and customers.”

Again, that was 2 years ago. Clearly, the business world is of today a very different place than it was in mid-2019, but it’s also very clear that Benioff and Salesforce are continuing to push more deeply into the realm of HR/HCM, regardless of how eloquently or persistently he or Salesforce might deny that.

This issue popped up last week in a article about some new features and capabilities in Salesforce’s Salesforce expands to move more formally into HR services.

So, should HCM heavyweights Workday, SAP and Oracle be concerned? I don’t think so—not even a little bit—and here’s why.

  • Workday has aggressively expanded, broadened, and deepened its product lineup so that its flagship HCM business is surrounded by other products and capabilities that insulate it quite effectively from the selective border skirmishes Salesforce is initiating.
  • SAP has said its SuccessFactors HXM business had an outstanding Q1, and the company’s integration of Qualtrics technology into SAP’s core offerings now give it the opportunity to transcend traditional HCM and become the leader in HXM: Human Experience Management. (I am 100% in favor of that move by SAP, by the way.)
  • Oracle last week said its Fusion HCM revenue was up 35% in its fiscal Q4 ended May 31, much higher than the 23% increase Oracle reported for Fusion HCM in the preceding quarter. 
  • Salesforce is moving into HCM subsegments that align with its core customer-experience business. As Benioff said in that earnings call 2 years ago in explaining why his move into HR was not really a move into HR: “This is something that very much enhances the customer experience and also the employee experience and strengthens the intersection between employees and customers.”
  • Outdated boundaries in the software industry don’t mean what they used to. Heck, look at SAP, which is now carefully and strategically unbundling its flagship ERP business to become “modular” ERP. Is HCM a part of ERP? Some say yes, some say no. Some say CRM, some say CX. The point is, the world is changing rapidly, and software categories are doing the same.
Final thoughts

I think Salesforce would be crazy not to leverage its strong position with from 2019 with the massive changes that have rocked the world of work in the past 16 months. Now, if Benioff next month introduces a new core HCM bundle from Salesforce—something with 0% chance of happening, by the way—then his longtime close friend and Workday co-CEO Aneel Bhusri would have good reason to be hacked off. 

But short of that, Benioff’s forays into the margins of HCM are good for Salesforce, good for its customers and good for keeping the competitive fires in the Cloud Wars white hot.

Disclosure: at the time of this writing, Salesforce, Workday, SAP and Oracle were all among the many clients of Cloud Wars Media LLC and/or Evans Strategic Communications LLC.


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