Enhancing SAP SuccessFactors Compensation with External Market Data

SAP SuccessFactors Compensation module does not directly support external salary benchmarking data. However, market data can be imported into the system and used to compare with existing pay ranges during annual compensation planning. A placeholder can be created in the system for the market data, which can be imported directly into Employee Central or through a lookup table in the compensation module. A section on the worksheet can also be created to display the min-mid-max of market pay for a specific pay grade and country, enabling planners to make compensation recommendations accordingly. If the external vendor can connect to the SF system, a custom integration can be built to automatically extract and store market data in custom MDF in Employee Central.

SAP SuccessFactors' Compensation module offers robust features for managing compensation plans but lacks direct support for external salary benchmarking data. However, the system allows for the importation of market data, which can be utilized to compare against existing pay ranges during annual compensation planning activities.

To integrate market data, SuccessFactors supports creating placeholders for external data. This data can be imported directly into Employee Central or through a lookup table in the compensation module. The key fields for this import are Country and Pay Grade, with 'Min', 'Mid', and 'Max' values maintained against these fields. This enables planners to compare market data with the current pay matrix for specific pay grades and countries, aiding in informed compensation decisions.

For example, a client in the new-gen technology sector, with top talents holding individual patents, sought to align their compensation with market rates. Despite platform differences and firewall issues, the client successfully imported market data into SuccessFactors, enabling effective compensation planning [1].

If the external vendor can establish a technical handshake with the SuccessFactors system, a custom integration can be built. This integration would automatically extract and store market data in custom MDF in Employee Central, facilitating seamless and up-to-date compensation benchmarking.

SAP's acquisition of SmartRecruiters, a prominent talent acquisition software provider, underscores the company's strategic approach to expanding its HR capabilities. This acquisition aims to enhance SAP's existing HR tools, enabling customers to manage the entire candidate lifecycle from sourcing to onboarding within a single system [2].

By integrating market data into the SuccessFactors Compensation module, organizations can better align their compensation strategies with market trends, ensuring they remain competitive in the talent market. This integration aligns with SAP's commitment to providing cost-effective solutions that realize the true value of their SAP investments.

References:
[1] https://community.sap.com/t5/human-capital-management-blog-posts-by-members/leveraging-sap-successfactors-compensation-for-salary-benchmarking/ba-p/14153700
[2] https://www.ainvest.com/news/sap-acquire-smartrecruiters-enhance-recruiting-tools-2508/