SAP to make SuccessFactors employee-management service available on Microsoft's Azure

SAP is planning to make its SuccessFactors employee-management service available as an option on Microsoft's Azure cloud over the next five years.
Written by Mary Jo Foley, Senior Contributing Editor

Microsoft is on a tear to get more independent software vendors (ISVs) to use Azure.


Microsoft and SAP are announcing that SAP will make its SuccessFactors cloud-based employee-management service -- currently hosted exclusively in its own data centers -- also available on Microsoft's Azure. Microsoft CEO Satya Nadella is announcing the deal at Gartner Symposium today, October 18.

SAP bought SuccessFactors for $3.5 billion in 2011. At the time, that purchase was hailed as the start of SAP's attempt to reboot its own cloud strategy.

SAP has been a Microsoft partner for more than 20 years. In 2014, the two announced an extension of their partnership, via which SAP would be certifying a number of its core business applications on Azure. Those Azure-certified apps included SAP Business Suite software, SAP Business All-in-One solutions, SAP Mobile Platform, SAP Adaptive Server Enterprise (SAP ASE), and the developer edition of the SAP HANA platform.

In 2014, Microsoft and SAP also announced plans to integrate a Microsoft's PowerBI and Excel with SAP's BusinessObjects business-intelligence offering, plus other gateways and integrations between SAP applications and Office 365 and Azure.

As is the case with other recent Microsoft ISV "wins" for Azure, there aren't a lot of particulars with the Microsoft-SAP announcement today. SAP does seem to plan to maintain its own hosted version of SuccessFactors, making Azure an option, not an exclusive. The addition of Azure as an option will happen over the next five years, according to today's press release.

In late September this year, Microsoft and Adobe announced that Adobe would make available its Adobe Creative Cloud, Marketing Cloud, and Document Cloud on Microsoft's Azure. The deal was not exclusive, and no timetable for completion was provided at announcement. Adobe currently hosts some of these services in its own data centers and others on Amazon's AWS.

Update (October 19): Here are a few more specifics about the Microsoft-SAP announcement, based on a phone call I had yesterday.

SAP has 42 million SuccessFactors subscribers, spread across 10 SAP-owned and "traditional raised-floor" providers, said Mike Ettling, President, SAP SuccessFactors, with whom I spoke by phone yesterday afternoon.

The agreement with Microsoft marks the "first time we'll be moving into a public cloud provider," Ettling said. But SAP plans to continue to make SuccessFactors available across a mix of its own and Azure public cloud environments. This isn't a move away from its own datacenters and towards Azure; it's an expansion of SAP's datacenters with Azure capacity across the globe, he explained.

It won't be up to SuccessFactor customers as to whether their workloads run in SAP datacenters or in Azure ones. The agreement with Microsoft is about expanding SuccessFactors' overall capacity, Ettling noted.

Though the press release about the Microsoft-SAP pact made it sound as if SAP wouldn't be moving SuccessFactors onto Azure for five years, this isn't the case, Ettling said. The first environments on Azure will be available in the first quarter of 2017, he said, as Microsoft and SAP engineers have been working on this already for a while.

"We've already made SuccessFactors platform- and database-agnostic," Ettling said. "There's nothing we have to do in our application stack" to enable the move to Azure. "It's about lifting and shifting client instances across, not our applications," he added.

I asked whether SAP might add another public cloud provider, like Amazon, to its SuccessFactors datacenter mix. Ettling said he wouldn't comment, beyond saying that SAP is "fully committed" to its partnership with Microsoft.

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