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Salesforce.com’s CEO Marc Benioff made a brave move when he coined the phrase “No Software!”. But what was SuccessFactors’ CEO Lars Dalgaard thinking when he coined the term “No Jerks!”?
SuccessFactors started out in 2001 to automate the generally unpopular annual personal performance review process. The reality is that personal performance criteria rarely reflects business strategy, are often superceded by the time reviews come around, and the metrics for judging performance are often ambiguous. The resulting subjective personal performance judgements of managers can easily result in staff CVs hitting the market.
Staff churn is bad for employers. If talented staff leave for the wrong reasons, knowledge, experience and competencies are lost, and the cost of new recruitment and training is high. A poorly administered personal performance review process drains profits, morale, and customer satisfaction.
SuccessFactors’ idea was to make personal performance review a continuous and objective forms-based process completed online. SuccessFactors has now filled this concept out into 8 core product modules: Performance Reviews, Goal Management, Compensation Planning, Analytics and Reporting, Succession Planning, Employee Profile, Learning & Development, and Recruiting Management.
SuccessFactors delivers its solutions using a SaaS model through two IBM hosting centres in New Jersey and Amsterdam that provide 24×7 Data Center Operations. They claim that the software architecture is platform agnostic, so no matter what software you are using, SuccessFactors is compatible.
SuccessFactors offers fixed professional services fees for the initial configuration and charges a per user fee. For example a 10 user system will attract a c. $3,000 configuration charge and a $100 per user per year charge—$4,000 in Year 1 for a small business is attractive. Interestingly, SuccessFactors’ case studies range from a 10 user company (Glynn Capital Management) to an 85,000 user implementation at Wachovia Bank, which emphasizes the platform scalability and SuccessFactors’ willingness to service all sizes of organization. Nice to see SMEs being lauded for once, though.
Using the SaaS model, SuccessFactors releases new features and functions every 30 days. If they were using a traditional licence model they would now be on version 60! It’s an on-demand subscription-based pricing model. Every customer can run the latest product version and there are no upgrade costs.
But back to the “no jerks” comment. SuccessFactors staff sign a 15-point ‘rules of engagement’ document before they start work. Rule No. 15, states: “I will be a good person to work with. I will not be an a**hole”. This has clearly resonated with the popular press—Forbes, the Times and other leading journals have written about it. Stanford University professor Robert Sutton has written a book which talks about Southwest Airlines and Intel adopting a similar principle. Jack Welch (of GE fame) speaks about it as part of SuccessFactors promotional activities.
Performance management software is now emerging as a departmental application whose different flavours will appear widely across the enterprise. A Sales flavour can be seen in my recent article Sales Performance Management gains market favour. A HR flavour is shown in this article. Other departmental performance management applications will follow such as Marketing and Customer Service. So maybe “No Jerks!” as a concept is here to stay—which can only be a good thing in my opinion.