The first honeycomb in the hive: Understanding the positioning of Financials OnDemand
A recent blog from Christian Horak entitled Positioning SAP Business ByDesign and SAP Financials OnDemand provides additional details about the strategy behind the new Cloud offering SAP Financials. One paragraph of the blog in particular got my attention.
But SAP Financials on Demand is more that just a financials solution! It also provides an open and flexible framework that forms the foundation for a loosely-coupled “Best of Suite” approach for enterprises, seeking to mix and match the financial core with best of breed components. With Financials OnDemand, other cloud solutions, starting with SAP Travel OnDemand, simply snap-in using open API’s to give customers a maximum of choice for building their own, personal best-of suite.
The idea of a new flexible framework underneath an SAP OnDemand Business application reminded me too much of the old SAP Core PaaS. There is an active comment stream on the blog and I wanted to sit down and try to describe what I think SAP is planning.
As I reflected on this paragraph and its implications I remembered an intriguing blog from Frank Scavo about the recent blogger meeting in California. One section ii particular reverberated with me.
Behind the scenes, SAP has been rearchitecting its SaaS offerings to be delivered as web services. For example, it has broken up ByD functionality into 32 “honeycombs,” so that no two of them share a common database. Rather they communicate via messaging. SAP has taken the same approach with its line-of-business applications. In fact, all of SAP cloud applications will be deployed as web services, including its mobility and database offerings. I have to believe this also includes SuccessFactors. SAP will now be able to sell individual modules (e.g. Finance), or a complete suite, or combinations in between.
Was Financials OnDemand the first honeycomb?
Note: There are also other honeycombs which are emerging. Supposedly, Sales OnDemand is also being retrofitted with an “open” API. Horak also mentions “SuccessFactors Employee Central, Payroll, CRM, SRM etc.
The goal behind this architecture
Note: In this section, I’d like to concentrate on SaaS applications themselves rather than the deep technical details of their interaction. I’ll tackle that topic in the next section.
If you look at SAP’s Cloud strategy, the idea of loosely coupled applications is usually referred to when discussing hybrid architectures (a combination of OnDemand and OnPremise assets).
This pattern can be applied to a variety of SAP OnDemand solutions (Travel OnDemand, Sales OnDemand, etc) and provides customers a certain degree of flexibility.
The presence of an API in Financials OnDemand and its positioning reflects the next stage in this evolution – loosely-coupled interaction between SAP OnDemand offerings.
If you view each of SAP’s OnDemand applications as independent honeycombs, then the interaction between them takes place with in the hive of the SAP OnDemand world. This pattern is what Horak calls “a loosely-coupled “Best of Suite” approach for enterprises, seeking to mix and match the financial core with best of breed components”
The final stage has yet to be emphasized but as the SAP’s OnDemand applications evolve it is can be expected to emerge at some point – a tighter integration with other non-SAP SaaS applications via loosely coupled interaction.
Note: Before someone says that this interaction with external assets already occurs, I wouldn’t disagree. If you look at Travel OnDemand or Business ByDesign, they already interact with external entities. Yet this integrations are relatively tight rather loose which means that they are relatively brittle with the accompanying high maintenance costs.
The important emphasis is on the loosely coupled aspect of this pattern.
Building the Hive: The technology involved
The question of what technology is going to be used for this hive was one of my irritants. My first assumption was that we were gong to have to point-to-point integration.
However, Horak responded to my comment with some details about the use of the NetWeaver Cloud.
I like the separation of business logic in the Business Apps (dare I call them Line of Business apps) is especially important and the use of the integration functionality in the NetWeaver Cloud is critical for its success.
I found Horak’s description of this functionality very interesting: “The best way to look at these API’s is to look at the ByDesign SDK. Inside of SAP Financials OnDemand we have a process library, which is essentially defining and provisioning the end to end processes with well-defined integration points.“ It is the well-defined integration points that are of importance in that they can hopefully provide customers a greater deal of flexibility inasmuch as OnPremise FI systems, Finance OnDemand or the offering from another vendor (for example, Coda Financials) could be used through single integration point.
The example application, Travel OD, just has one integration with the NetWeaver Cloud. The complexity of integration with the back-end applications remains in the NetWeaver Cloud based integration engine.
Inside the Honeycomb: Dissecting the Financials OnDemand “Framework”
Horak provides very little details about this “open and flexible framework that forms the foundation fora loosely-coupled “Best of Suite” approach”. In my opinion, there are a few possibilities.
Each “Best of Suite” App has their own framework
This sounds like the approach that Frank Scavo describes in his blog with each honeycomb having its own database. This is a definitely a clean architecture that permits each SaaS application to develop at its own speed. But you would probably have difficulty synchronizing data between the various honeycombs since there are some common business objects (Customer, partner, employee, etc) that would exist in different honeycombs. Add the complexity of having different tenants / customers in each application and data coordination quickly becomes non-trivial.
There is a common framework
The necessity of having common functionality may mean that the old Core PaaS will be resurrected and be shared amongst the “Best of Suite” applications.
This option would represent a threat to the idea of the NetWeaver Cloud as the single PaaS for partners / customers to develop applications. This is based on the assumption that partners / customers will be able to use these “open and flexible” frameworks as well.
Note: I’m leaving ByDesign out of these diagrams for simplicity sake but it is involved as well as it shares functionality with these Best of Suite applications as well.
I’ve based this blog on the few blogs that have emerged about Financials OnDemand. I expect more details in the Sapphire / TechEd in Madrid when it is being launched.
Note: I probably have misunderstood a few details about Financials OnDemand but I’m hopeful that those with inside knowledge correct my mistakes so that the solution is better understood by all.
I like the idea of business honeycombs and I think they really exploit the process knowledge that SAP has acquired over the years.
Let’s just hope that the honey created by these honeycombs is sweet enough to attract customers who have multiple honey pots from which to satisfy their appetites.