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Author's profile photo Richard Hirsch

Playing 20 Questions with SAP’s On-Demand + On-Premise Product Strategy

At the recently concluded SapphireNow conference, the technological focus was largely centered on how SAP is responding to the threat / opportunity of On-Demand environments. As seen in the slide from Jim Hagemann-Snabe’s Keynote speech on Tuesday, SAP’s On-Demand Product Strategy was described as being two-pronged – based on “Line Of Business Solutions” and “Integrated On-Demand Suite(Business By Design)”. 

For me, the more intriguing aspect is the LOB solutions; thus, this blog will focus on these solutions.  ZDNet’s Larry Dignan summarized this functionality in his blog about the SapphireNow:

SAP’s on-demand plan is to extend Business Suite and seamless integration with on-premise systems. SAP will have two approaches to the on-demand market. “The first is line of business extensions” to on-premise software,” said Snabe, who showed a few screenshots of Sales OnDemand, a SaaS CRM play. These processes would be shared. Line of business on demand parts cover Expense Management, Sourcing OnDemand, Sales On-Demand and People Management. “This enhances your on-premise systems,” said Snabe.

As I have discussed in a Quick thoughts on on-demand and on-premise environments and their innovative potential,  the interaction between SAP’s On-Premise and On-Demand offerings has enormous innovative potential and I was hoping to learn more at the Sapphire – which I did.  In Jim’s keynote and in the Panel Discussion on SAP’s Product Strategy, Meeting Customer Demand in a Changing Business Environment, there were interesting discussions concerning the relationship between the two areas. 

As I started to think about this hybrid strategy, questions began to emerge in my mind. As I followed these thoughts, I realized that this strategy involved fundamental changes in the SAP application landscape that would impact everyone involved in the SAP ecosystem – from partners to users to SAP Basis / operations staff. Some may may thinking: „Dude, lighten up – it was a keynote at a SAP Sapphire and you know keynotes are always full of fluff. The SAP executives presented a broad product strategy that demonstrates intentions for the period between now and 2015.  Cut ‘em a bit of slack”. 

With so much at stake, I’d like to play Twenty Questions to try and better understand what SAP intends. 

How to play

  1. One player is chosen to be the answerer.   In this case, SAP will be the answerer.
  2. All other players are questioners. They each take turns asking a question which can be answered with a simple “Yes” or “No”.
  3. The answerer answers each question in turn. Sample questions could be: “Is it bigger than a breadbox?” or “Can I put it in my mouth?”
  4. Lying is not allowed, as it would ruin the game. If a questioner guesses the correct answer, that questioner wins and becomes the answerer for the next round.
  5. If 20 questions are asked without a correct guess, then the answerer has stumped the questioners and gets to be the answerer for another round.

In this game, a vague question that confirms or negates an assumption may be just as useful as a concrete question.

Note: Usually, this game is interactive where the questioner’s questions reflect the “Yes/No” answers that he/she receives.  In this fashion, the game demonstrates a spiral as the questioner refines his questions -narrowing down the potential answers. Since this interaction isn’t possible, I’ll just ask my questions at once without the ability to refine them.

The 20 Questions regarding On-Demand – On-Premise interactions

A Caveat: I realize that this strategy is definitely a work-in-progress and SAP might not have the answers to my questions.   Perhaps, these questions will in some way guide the individuals defining this critical strategy.

Note: To clarify some questions, I have added commentary

  1. Are there actually two types of On-Demand LoB solutions? Reading post SapphireNow blogs, there appears actually to be two types of LoB solutions. The first is a pure On-Demand solution that is distinct from BusinessByDesign (ByD) but is based on the “Lessons Learned” from ByD – including re-using its technological foundation. One example of this sort of solution is CRM On Demand. The other solution involves Hybrid environments mixing On-Demand and On-Premise functions.
  2. Are we talking about processes that bridge both worlds? Integration between On-Demand and On-Premise environments can take a myriad of forms based on low-level APIs, event-based interactions based on an Enterprise Service Bus, etc. I’d like to confirm that SAP’s product strategy focuses on interaction at the process level with all the relevant ramifications – common repository for Enterprise Services, modeling environments that compensate for the respective strengths and weaknesses of each environment, etc. As a second slide from the keynote (below) depicts a process that includes steps in both worlds, I’m assuming that this is planned integration strategy. (In this blog, I’m going to describe such processes that jump between On-Demand and On-Premise environments as „bridge processes”) (I apologize for the quality of screenshot – the conversion tool that SAP used to convert PPT to PDF tweaked the graphics)

  3. Is there a definitional ambiguity between the use of word “Extension” regarding On-Demand – On-Premise interaction and the implications of changes in core processes that must occur in such environments? As seen in Larry Dignan’s summary above, both points are used when discussing this strategy. However, I have problems with the term “business extensions” and its description. Such extensions are described as similar to Business Suite Enhancement Packages which bring innovation to the core in a way that is hopefully non-disruptive and doesn’t threaten the stability of such environments.  Such bridge processes, however, have a revolutionary character in that the inherent potential of On-Demand environments can radically change how a company conducts its business.  Thus, there is a conflict between the idea of extensions that add new functionality without impacting core functionality and bridge processes with their revolutionary character.
  4. Will SAP standardized processes be converted into bridge processes? In the Panel Discussion about SAP Product strategy, a variety of customers described the importance of using standardized SAP processes to reduce costs.  I’m assuming that processes supplied by SAP will include functionality that allows them to take advantage of On-Demand functionality.
  5. Will the use of SAP-Standard bridge processes require a great of customizing? Obviously, the acceptance of hybrid solutions will be based on the costs associated with their set-up and their maintenance. If such a solution requires a huge implementation project, then customers may be hesitant to make such a move.
  6. Will existing non-SAP-standardized processes based on On-Premise technology be able to use On-Demand functionality? Another discussion point during the Panel Discussion was the emphasis placed on “Differentiator” processes that distinguish particular customers from their competitors. Many customers are reluctant to place such processes in the cloud. Ideally, these processes could remain On-Premise but still take advantage of On-Demand functionality (for example, Analytics).
  7. Will interactions with On-Demand environments that aren’t controlled by SAP be allowed / supported? As On-Demand solutions increase in number, cloud-based solutions provided/ hosted by partners will also increase.
  8. Will the technical integration between On-Premise and On-Demand components be based on standards? I asked SAP CTO Vishal Sikka this same question at the Roundtable “Timeless Software, Disruptive Technologies – Embracing the Dynamics of Change” at the SapphireNow and he gave a vague answer about the use of timeless software – I’m not sure if he meant Enterprise Services or just web-services in general.
  9. Are such processes running in hybrid environments based on BPM technology? For processes that jump between On-Demand and On-Premise environments, a new set of BPM design-time and run-time tools will be necessary to orchestrate such processes.  
  10. Will new On-Demand solutions in private clouds be supported?
  11. Will it be possible to host to SAP On-Demand LoB solutions like Sales On-Demand in public clouds (for example, the Amazon cloud)?
  12. Will new educational classes or certification be necessary for partners to customize / service such hybrid solutions?
  13. Is the use of such bridge processes restricted to the users of the latest version of the Business Suite or will users of older versions also have the opportunity to use this technology?
  14. Will On-Demand solutions contain options to retain data storage in On-Premise environments? In you look at SAP’s UPods project, this is one its advantages.
  15. Is a federative identity management between On-Demand and On-Premise environments planned? Obviously, a common identity management between the environments is necessary. SAML is the ideal choice for such a requirement
  16. Will the main User Interfaces for bridge processes be based On-Premise?  In current BPM environments, Universal Worklist is usually the User Interface with which users integrate with their task list. Will there will be a new version of UWL that adapts to On-Demand environments?

I’ve left 4 questions open, why don’t you add other questions via comments to help SAP clarify their Product Strategy. I feel such efforts are useful. Interested individuals can respond / interact with SAP in an open yet innovative manner.  SAP can benefit by getting early feedback on its product strategy – a new flavor of crowd-sourcing.

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