IBM To Push SuccessFactors' SaaS Into Large Businesses

The deal shows how IT service vendors are finding ways to participate in SaaS's momentum.
IBM's services division is expanding its presence in software as a service with a new deal to resell and implement SuccessFactors, a software service for employee performance management.

IBM already provides data center hosting for a number of SaaS vendors, including RightNow Technologies, Intacct, and SuccessFactors. The new deal calls for IBM Global Business Services to sell SuccessFactors as a SaaS option to large companies.

SuccessFactors is one of few vendors that has been able to push the SaaS model into large companies, largely because performance management software is relatively generic and doesn't require a lot of customization to meet a company's specific needs.

SuccessFactors has landed a number of big deals, like one last year with Wachovia for 85,000 employees. This week it announced deals with for 1,600 employees and Advocate Health Care, which employs 24,500 people. SuccessFactors said it won a 300,000-seat customer in April but would not disclose the customer's name. SuccessFactors raised about $100 million in an initial public offering of stock last year.

SuccessFactors claims its offering is ideal for large companies with multiple divisions, multiple lines of business, and employees around the globe with differing languages and cultures.

IBM has worked with SuccessFactors in the past, including an implementation at direct-marketing company Advo to identify managers for promotions and retain profiles of employees.