Germany’s SAP has just announced a $3.4 billion cash deal for the purchase of U.S. web-based software company SuccessFactors.

SuccessFactors went public four years ago at $10 a share. Competing with companies such as Taleo Corp and Kenexa Corp., SuccessFactors makes human resources software that companies can use to review the performance of their employees.

As Paul Hamerman, an analyst at the technology research group Forester, said, “By acquiring SuccessFactors, SAP puts itself into a much stronger competitive position in human resources applications and reaffirms its commitment to software-as-a-service as a key business model.”

The prediction is that the cloud computing market will be growing from $40.7 billion in 2011 to more than $241 billion by 2020.