- At SAP, we encourage the well-being of our employees and our organization so we can master the challenges of a digital and global workplace.
- We enable our people to perform at their best so they can help our customers succeed in the digital economy. At SAP, everyone is a talent.
- Our “How We Run” set of behaviors describes how we get things done and is at the very heart of our culture.
Our HR Strategy Is Built for Our People
At SAP, we put our customers at the center of everything we do. It is our employees who are helping our customers succeed in the new digital economy and enabling us to become THE cloud company powered by SAP HANA. Therefore, we are fully committed to the people side of our business.
As digital advances change customer expectations, they also fundamentally change the ability of our employees to have a greater share of voice in defining their own work experiences. Today’s talents expect a diverse, agile, and yet highly personalized workplace that is in line with individual needs. They expect inspiring and caring leaders who can rethink how we collaborate to drive innovation. Similarly, they expect meaningful learning and career opportunities – all of which are powered by pervasive technology.
Our human resources (HR) strategy is to create a culture that is able to deal with the complexity, speed, and volume of a digital workplace – a culture that inspires innovation, leads change, and creates ultimate employee satisfaction. We want employees to learn and grow, leaders to engage and develop amazing talent, and organizations to be simple and agile. With our three guiding principles of simplification, standardization, and customer satisfaction, we stay focused on our ultimate goal, which is a seamless, simple employee experience. Ultimately, our HR strategy supports the creation of an HR organization that is built on cloud technology to Run Simple.
Getting the Right Talent in the Right Place at the Right Time
To support SAP’s transformation to THE cloud company powered by SAP HANA, it is important to understand what it means to operate with a cloud mindset. Part of this transformation means not only changing the way we hire new talent, but also developing and retaining our employees.
In 2015, approximately one quarter of all external hires are considered “early talents” (hires with professional experience of up to two years). This success is due to ambitious early talent hiring targets, increased hiring activities in areas of diversity, expanded use of the SAP SuccessFactors Recruiting solution as our recruitment management system as well as the continued recognition of SAP as an employer of choice. In fact, SAP was recognized in Brazil, Greater China, India, and Japan by the Great Place to Work Institute, and named by Forbes as a “Best Employer” in 2015.
Once we hire new talent, we make sure that the onboarding experience is an engaging and inspiring one. To this end, we offer dedicated new-joiner programs. In addition, we closely collaborate with 2,300 universities on international events such as student meet-ups, info days, or coding events, such as InnoJams, and many other events through our SAP University Alliances program.
Another cornerstone in our efforts to recruit early talent is our vocational training program, which allows students to work towards their university degree while gaining valuable SAP business experience at the same time. The program has a clear focus on IT related areas such as Development, Services/Consulting and IT. As of October 2015, 880 vocational training students were enrolled in the program that originally started in Germany. A few years ago, we extended the program into key markets such as China and India, and added Hungary, Ireland, and the United States recently. In 2015, 210 vocational training graduates around the world started their professional careers with an SAP contract. Overall, we measured a conversion rate for vocational training students of 63% in 2015 (2014: 59%). The high-performance ratings of the students after graduating prove the success of the program.
In the area of people development, we continue with our philosophy of “everyone is a talent” that came to life in 2013. Major achievements are:
- Simplifications to our performance management process and tools to further improve the overall employee experience in our cloud-based Success Map tool
- Development offerings for specific groups such as early talents, experts, and fast-track employees
- Introduction of Career Success Centers around the world that provide dedicated career development support
- Introduction of a globally consistent succession management approach for executive roles
To fund our continued investments in growth areas including cloud, SAP HANA, and business networks we scaled back in areas where we see no significant growth in the future. As part of this program, roughly 3,000 employees moved into new jobs or left SAP. To manage these transitions while remaining people-centric, we use a mix of measures, including voluntary and early retirement programs that have proven very successful.
The overall retention rate in 2015 was 91.8% (2014: 93.5%). We define retention as the ratio of average number of employees minus voluntary attrition to the average number of employees (in full-time equivalents). High retention is something we are aiming for as reflected in all our activities to drive high employee engagement.
Engaging Our People Through Impactful and Inspirational Leadership
At SAP, we see leadership as a profession. We make leaders accountable, and create a consistent leadership culture across the organization to ensure the engagement and advancement of our people.
Our leadership principles (ensuring customer success, driving simplicity, developing amazing talent) remain the foundation for leadership at SAP. With the demands of digitization, our leaders must operate with a comprehensive end-to-end view that focuses on delivering both immediate and long-term value for customers while optimizing operations. However, our leaders also need to focus on attracting and retaining talent with the right skills and digital mindset in a competitive market where digital skills are scarce.
In 2015, we continued to move the needle of leadership trust measured by our People Survey 2015 that ran in October. In 2015, the overall leadership trust score for people leaders, which uses the Net Promoter Score (NPS) methodology, was 52.3% compared to 46.8% for 2014 against a target of 51%. For 2016, we are committed to keep the 2015 leadership NPS value of more than 52%.
We need leaders at every level who internalize what it will take to achieve our strategy, have the mindset to amplify the intelligence and capabilities of everyone around them, and have the ability to accelerate business transformation. In 2015, we mandated a three-day program for all our top leaders that resulted in each leader creating an individual plan for how they will lead SAP’s transformation. In 2015, we also launched a flagship program for first-level people leaders who are responsible for guiding 75% of SAP’s workforce. Corresponding programs go live in the first quarter of 2016 for mid- and executive-level leaders. All programs are mandatory for people leaders who aspire to advance in their career.
In July 2015, leaders and selected high-performing employees participated in a virtual leadership summit with a focus on cascading consistent messaging for SAP’s digital business framework. This provided critical alignment for our strategy and the channels to communicate it throughout SAP. The summit included an in-depth financial update, positioning and messaging for the digital business framework and an aggregate report of the recently completed leadership assessments for the top 250 leaders.
Making Learning a Compelling Experience for Everyone
Our learning culture supports employees at all levels and roles in their learning efforts. Building on our philosophy of “everyone is a talent,” we want to maximize the skills of all our employees. 2015 was a major year for learning at SAP, with a focus on stronger governance and increased transparency on how we spend our learning funds.
Professional development offerings (self-paced online programs that include language learning as well as technical and soft-skills training) are open to all employees. In addition to learning portfolios offered by board areas, virtual self-paced programs support employees building impactful development plans that meet their career goals. Our peer-to-peer learning portfolio includes coaching, mentoring, job shadowing, and facilitation opportunities. Our Global Coaching program received the 2015 International Coaching Federation Prism Award. Similarly, our Global Customer Operations (GCO) University program won the Brandon Hall Gold Award for Excellence in Sales Performance.
In 2015, we also hosted many learning culture workshops as well as virtual and in-person coffee corner sessions worldwide as an opportunity to foster exchange with peers and managers.
Creating an Environment That Drives Innovation, Performance, and Engagement
It is our goal to create an environment and a workplace that drives innovation, high performance, and employee satisfaction; we do so by providing the following benefits and activities:
- In 2015, SAP again offered a Share Matching Plan (SMP) that enables employees to purchase discounted shares and receive additional matching shares. Employees also received Restricted Stock Units (RSUs) under the Employee Participation Plan (EPP), as well as a Stock Option Plan (SOP) that rewards selected employees and executives.
- To help make our employees’ lives easier when dealing with people-related topics, we continue to transform our entire HR-IT landscape with the ongoing implementation of SAP SuccessFactors solutions.
- With our “Accelerate Winning in HR” initiative, our HR organization helps support business goals with our domain and functional knowledge. In 2015, approximately 130 HR experts supported sales teams in HR deal engagements. We were able to convey a true “SAP Runs SAP” story to potential customers with our SAP expertise.
As another example, SAP again sponsored “People Weeks,” a two-week program designed for employees to learn from each other, exchange ideas, and cultivate a greater connection across cultures, genders, and generations. Under the motto “Shine through the Cloud,” the event reached 25,000 employees in 75 locations and 52 countries.
Promoting Inclusion, Well-Being, and Social Innovation
Diversity and Inclusion
An inclusive culture inspires greater innovation, helps us better connect with and serve our customers, fosters employee engagement, and makes SAP a more attractive workplace. At SAP, our diversity and inclusion efforts focus on four key areas:
- Gender intelligence
- Cross-generational intelligence
- Differently-abled people
- Culture and identity
SAP has publicly stated our commitment to achieve a workforce of 25% women in management by the end of 2017. We have made great strides toward our goal, with year-over-year growth from 21.3% in 2014 to 23.6% in 2015.
We offer executive sponsorships for women and strive for a qualified, equally distributed hiring shortlist that aligns with our corporate diversity targets. Additionally, we offer the Leadership Excellence Acceleration Program (LEAP), a highly respected and award-winning development program that helps prepare high-potential women for leadership roles at SAP. In May 2015, SAP co-sponsored the first Women’s Leadership Summit at the SAPPHIRE NOW conference.
Additional initiatives to support female careers at SAP include the Women’s Professional Growth Webinar series, the Business Women’s Network, and the Women@SAP online community.
For our commitment to gender equality in the workplace SAP America was awarded with the Economic Dividends for Gender Equality (EDGE) certificate as the first technology company in the United States.
Our Autism at Work program, an initiative that enables people with Autism Spectrum Disorder (ASD), continues to gain momentum and recognition. In October 2015, we also launched the program in Australia. Now implemented in eight countries, the program has won numerous accolades including the Catalyst Award of the US organization The Arc, for people with intellectual and developmental disabilities, and others. SAP is committed to having 1% of our total workforce composed of individuals with ASD by 2020. As of today, SAP counts a total of approximately 100 ASD employees. These employees can add enormous value to our ability to innovate with their high attention to detail in development and data analysis and contribute to us as a diverse company.
SAP has also made great strides in other areas such as the advancement of lesbian, gay, bisexual, and transgender (LGBT) rights. The Global Pride@SAP employee network has grown to more than 5,000 members, sponsoring numerous activities and initiatives throughout the year. In April, SAP joined the Human Rights Campaign (HRC) Business Coalition for Workplace Fairness in the United States, supporting the U.S. Employment Non-Discrimination Act (ENDA). SAP earned top scores in the HRC Foundation’s 2016 Corporate Equality Index.
In early 2015, our “How We Run” initiative was launched. Its outcome replaced the SAP passions by defining behaviors that describe what makes SAP unique. In a bottom-up approach, employees had the opportunity to define the behaviors that link SAP’s culture to its strategy. The result was five distinct behaviors:
- “Tell it like it is”
- “Build bridges, not silos”
- “Keep the promise”
- “Stay curious”
- “Embrace differences”
We invest in extensive employee benefits, programs, and services that truly make people’s lives better:
- Corporate Oncology Program for Employees (COPE) is available in Canada, Germany, and the United States, COPE offers employees facing cancer an individual, cost-free tumor analysis and interpretation based on TreatmentMAP™ by our external partner Molecular Health.
- Health Checkup for Executives is a one-day, one-on-one health checkup program for executives.
- Take Charge of Your Health and Well-Being program empowers employees to make the right decisions for their health and well-being.
- Health Ambassador Network is a global network that strengthens our focus on health in office locations and helps identify best practices.
- Local offerings, such as skin screening, on-site gyms and activity classes, mindfulness practice, eyesight testing, and health awareness sessions, are available to employees.
Our Business Health Culture Index (BHCI), based on our People Survey, assesses the degree to which our workplace culture supports people’s well-being, work-life balance, and organizational health.
The positive trend of the BHCI continued, achieving 75% compared to 72% in 2014. The BHCI for 2014 was recalculated from 70% to 72% based on two questions in the People Survey concerning work-life balance. The changes were done to simplify the questionnaire and to achieve better comparability against external benchmarks. With the very positive result in 2015, we see the first indications that a health-focused culture has a significantly positive impact on employees. In an ever-changing environment and with SAP’s transition into the cloud, we firmly believe that the very good financial results of SAP for 2015 were supported by the BHCI results. Based on 2015 data, a change by one percentage point of the BHCI would have an impact of €75 million to €85 million on SAP’s operating profit. For more information, see the Integrated Performance Analysis section of the SAP Integrated Report online.
One of the major challenges for SAP and our customers on the digital transformation journey will be ensuring there is enough skilled talent around the world. The demographics are daunting with more than one billion young people on the planet, 85% living in developing countries, and more than 90 million unemployed. At the same time the global economy will be facing a shortage of 40 million highly-skilled workers by 2020. To help bridge this skills gap and support economic development, SAP’s social investments focus on equipping the world’s youth with the skills they need to tackle society’s problems and thrive in the digital economy.
Our corporate social responsibility (CSR) programs do this in two main focus areas: building the capacity of innovative social enterprises that put young people on the path to successful careers, and building a skilled workforce for the IT sector with skills, training or workforce development programs.
A core component of our CSR approach is pro-bono volunteering activities that use employees’ core skills for social good. These programs help strengthen leadership competencies while delivering needed services to communities and individuals worldwide. Now in its fourth year, the SAP Social Sabbatical is a short-term assignment for key talents who work in diverse teams to solve business challenges for the education and social entrepreneurship sector in emerging markets. In 2015, the program was expanded to include work with local organizations in an employee’s region. As of 2015, more than 40,000 pro-bono service hours were attributed to 163 employees for 57 organizations. These include AhoodooTec, a tech startup in Addis Ababa, Ethiopia, that develops Web applications and mobile apps for secondary school education, and Livox, a Brazilian startup that makes accessibility software to help people with disabilities speak and learn.
SAP launched the very successful Africa Code Week, which trained nearly 90,000 children on coding in one week in October 2015. Young people from 17 African countries took part in the more than 3,000 free coding workshops.
In 2015, the world’s eyes were opened to the breadth of the global refugee crisis. SAP’s leaders and employees felt strongly that SAP could make an important contribution and committed to a broad holistic approach. The program covered internship opportunities for at least 100 refugees as well as humanitarian assistance. Through employees giving more than €200,000 and CSR commitments, SAP pledged more than €900,000 to immediate relief, long-term education, and integration projects to assist refugees. In addition, SAP joined forces with the Grammy-award winning band Imagine Dragons to launch the One4 project under the hashtag #One4. Imagine Dragons donated the proceeds from their song “I Was Me” to the UN Refugee Agency (UNHCR). Further, SAP is donating 10 U.S. cents for every download up to the first five million downloads from iTunes.
Our past People Survey scores revealed that our employees were committed to executing the strategy but needed support to translate the strategic direction into their daily lives. Subsequently, we decided to continue our focus on this key topic in 2015. Across the five waves of our quarterly strategy checkpoint survey in 2014 and 2015, there was a steady increase in strategy adoption. By the end of September, more than 8 out of 10 employees say they are aware of the strategy, understand it, and are committed to executing it. We continue to measure the success of strategy adoption in 2016, along with the adoption of the key cultural elements that are the How We Run behaviors and leadership principles.
To measure the achievements of these respective initiatives, we conducted our People Survey from October to November. We are able to link our financial and non-financial performance to employee engagement. A change by one percentage point of the Employee Engagement Index (EEI) would have an impact of €40 million to €50 million on SAP’s operating profit. For more information, see the Integrated Performance Analysis section of the SAP Integrated Report online. Employee engagement remains one of SAP’s corporate objectives, along with growth, profitability, and customer loyalty.
As a company that sets out to make the world run better and improve people lives, we cannot stop here. Based on the survey results, we decided to focus, in particular, on two areas in 2016: our efforts to simplify our processes and our ability to innovate. Employee engagement will remain one of our Company-wide strategic goals, and thus we remain committed to achieving 82% in 2016. This is an ambitious goal since in comparison to external norms as the current level of engagement is already in the top 10%. Similarly, we focus on the simplification of HR service offerings with our internal HR Run Simple program. The measurement of our internal HR customer satisfaction delivers actionable insights for prioritizing the strategic investments and deployment of resources as well as for creating efficiency through continuous improvements or decommissioning of services.
On December 31, 2015, we had 76,986 full-time equivalent (FTE) employees worldwide (December 31, 2014: 74,406). This represents an increase in headcount of 2,579 FTEs in comparison to 2014. The average number of employees in 2015 was 75,180 (2014: 68,343).
We define FTE headcount as the number of people we would employ if we only employed people on full-time employment contracts. Students employed part-time and certain individuals employed by SAP but who, for various reasons, are not currently working, are excluded from our figures. Also, temporary employees are not included in the above figures. The number of temporary employees is not material.
On December 31, 2015, the largest number of SAP employees (44%) were employed in the Europe, Middle East, and Africa (EMEA) region (including 23% in Germany and 21% in other countries of the region), while 29% were employed in the North America and Latin America (Americas) region (including 21% in the United States and 8% in other countries of the region) and 27% in the Asia Pacific Japan (APJ) region.
Our worldwide headcount in the field of cloud and software decreased less than 1% to 14,991 FTEs (2014: 15,074). Services counted 15,085 FTEs at the end of 2015 – an increase of 3% (2014: 14,639). Our R&D headcount saw a year-over-year increase of 11% to 20,938 FTEs (2014: 18,908). Sales and marketing headcount grew by 1% to 18,206 FTEs at the end of the year (2014: 17,969). General and administration headcount stayed constant at 5,024 FTEs at the end of the year (2014: 5,023). Our infrastructure employees numbered 2,743 FTEs – a decrease of 2% (2014: 2,794).
In the Americas region, headcount (FTEs) increased by 95, or less than 1%; in the EMEA region, the increase was 566, or 2%; and in the APJ region, it was 1,919, or 10%.
Our personnel expense per employee increased to approximately €135,000 in 2015 (2014: approximately €115,000). This rise in expense is primarily attributable to an increase in salaries, employee-related restructuring expenses, share-based payments, and a significant rise in the share price in 2015. The personnel expense per employee is defined as the personnel expense divided by the average number of employees. For more information about employee compensation and a detailed overview of the number of people we employ, see the Notes to the Consolidated Financial Statements section, Note (7).