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Cloud-based software giant has agreed to buy performance management firm Rypple for an undisclosed sum, the two companies announced today.

Rypple dubs itself as a “cloud-based social performance management company.” Basically, it provides software designed to help managers improve employee performance through “social goals” and consistent feedback and recognition. It competes in an increasingly competitive (and essential) market for cloud-based human resource management services. Leading competitors include SuccessFactors, which enterprise giant SAP recently announced it was acquiring for $3.4 billion, Taleo (whose revenues come mostly from recruiting), Workday, Ultimate Software, and Cornerstone OnDemand.

Rypple counts outfits like Facebook, Mozilla, Spotify and Rackspace as customers, and it has raised $13 million to date in three rounds of funding.

The deal is expected to close by the end of April 2012. Pending approval, Salesforce will take over Rypple and re-name the service as “Successforce” to meld it better with the cloud company’s branding. Successforce will fall under Salesforce’s new human capital management (HCM) unit, which will be run by John Wookey, Salesforce’s executive VP for advanced applications.

“ and Rypple share a vision for extending the social enterprise to transform the way we work,” said Salesforce CEO Marc Benioff, in a statement. “The next generation of HCM is not just about a cloud delivery model, it’s about a fundamentally better way to recruit, manage and empower employees in a social world.”

Salesforce’s commitment to HCM signifies the social direction major companies are headed and with Rypple, we’re seeing another example of consumer-focused tech applied to business. Further validating these notions, enterprise social networking company Jive Software went public this week.


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