Jan 10, 2013 announcement of SAPOnHANA was very important to me for several reasons, not because SAP is now running on HANA. As several of us know, we really need to give some more time for SAP to make SAPOnHANA – production-ready. Why then it is very important?
1 The Past
- Hasso’s admission of “no R/3 without DB2 and Oracle” moved me.
(Timeline: appoximately 14m:30s in his speech on Jan 10, 2013)
This was tough for SAP. To go into competition with IBM, Oracle the two founders basically of the R/3 development. There is no R/3 without DB2 and the work we did on the mainframe and Oracle the work we did with Unix computers in the early 90’s.
2 Open Innovation
“Open innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology”. The boundaries between a firm and its environment have become more permeable; innovations can easily transfer inward and outward. The central idea behind open innovation is that in a world of widely distributed knowledge, companies cannot afford to rely entirely on their own research, but should instead buy or license processes or inventions (e.g. patents) from other companies. In addition, internal inventions not being used in a firm’s business should be taken outside the company (e.g., through licensing, joint ventures, spin-offs)
Vishal Sikka in his blog: This statement – see below – is highly intriguing to me for several reasons. First & foremost, would what SAP promise even be practical because R/3’s design philosophy was based on a premise that the traditional databases are slow? (Hint: Number range buffering, table buffering, VBMOD, VBDATA, VBHEADER etc). I’ll provide more details in the next blog. I know Hasso mentions in his speech that the business logic could be pushed to DB layer of traditional databases due to advances in technology. But still read/write from/to the disk is expensive, isn’t it?
Innovations in the SAP Business Suite, such as push down of data centric processing logic from the application server to database tier via stored procedures would be made available to other databases too making them perform better too.
Would SAP’s approach be considered good example for open innovation? Craig discusses open innovation in the context of one’s own ecosystem whereas SAP is discussing (about) taking open innovation to the next level, the competitors. I’m sure many would question SAP’s real intention behind this approach.
3 Clarity on Pricing
Andreas Oczko, member of the board of DSAG: “We pushed for a pricing model which is based on the customer’s added value. This means that SAP customers must now upgrade only those licenses which actually access the HANA database and they do not have to upgrade the entire license agreement. As far as licensing costs are concerned, the database for the Business Suite on HANA will now cost existing SAP customers exactly the same as the conventional databases. This will give each individual customer the chance to use in-memory technology at a reasonable price.”
Marco Lenck, chairman of the board of DSAG: “SAP has adopted our proposals to setup the pricing model based on contract value and not on main memory usage. Due to the conventionally focused pricing, existing customers now have easy access to innovations in the HANA environment. SAP has responded customer-oriented to the core requirement of the DSAG. We believe that this will lead to a strong push in the adoption of the new technology.”
Dennis further states “These statements should be taken as a solid endorsement from a group that does not fight shy of voicing its adverse opinions.”
Several years ago, I was amazed when I saw standardization in R/3 screen(SAPGUI) layout. I saw beauty in that consistent “look & feel” of SAPGUI screen layouts. And then I forgot about it as I became familiar with SAP. Recently once again I was amazed at how well SAP delivered the “revised and upgraded” methodology of upgrades using MOPZ, LVSM and other tools. Software is not science but the upgrade methodology and SAP tools seemed like science. Based on that experience, I once again started feeling SAP would deliver what they promise elegantly.
I’m not talking about HANA speed but the speed with which SAP delivered “somewhat working SAP-HANA” to the market. I’m sure we’ve a long way to go before “SAP runs on HANA” becomes “production ready”; however SAP demonstrated commitment, dedication, perseverance, determination, arguably clarity and more importantly brilliance in both the announcement and HANA delivery.