Whilst on my last Blog entry I left some open questions which got answered in record time on BusinessSuite on HANA this time it is more a reflection of a reality that I am finding. I have borrowed the NBSSC from a top manager of our company. He used to call his weekly review very similar to it and it was actually very very fruitful for everybody who participated.
You might ask yourself what NBSSC stands for? It is nothing else but No Bull S..t Sales Call. I will tell you more about the background and the idea behind it since it does really involve all 4 parties which are in each an every sales call for SAP HANA.
– HW Partner
– Consulting Partner
True is that in some cases the consulting partner can be SAP itself or linked directly with the HW partner but for the simplicity let’s keep it like that. Whilst NBSSC can sound quite harsh and I admit I have some reason for it I hope that it helps us all to spend some thought on if this is really the direction we want to be heading forward to.
Most customers today are in a position in their IT departments in which their yearly budget is being reduced YoY so they have to do more with less. The need for more advanced analytics is probably clear to every body by now and also that BigData is important in order to take better decisions. But now the dilema starts. How to focus and improve Analytics which in 99% of the cases require additional software and some specific hw as well in order to be performant? Since we are talking SAP HANA here I will not widen the focus and keep it on HANA only Customers hear about all the great stories of customer who have implemented already SAP HANA and have had vast improvements not only in performance but also in size of their system (the latter is a very good argument for people with less budget!!!). Many of the customers I have seen are requesting a Pilot to SAP who in most of the cases admitted this to the customer.
The expectations of the customers are huge since almost all have heard of Yodobashi with a 100.000 times performance improvement. What happens to a customer when he does a pilot and sees only a performance improvement of factor 10-20 ?
SAP has done a very good and successful effort to position SAP HANA. There is probably no customer, partner in the SAP and non-SAP space who has not heard of it yet, more than that knows what it is about. This is very important and the latest announcements with BusinessSuite on HANA make it clear for the last that the road ahead is called HANA. I am very pleased to see that the pricing for BusinessSuite on HANA has become also more soft compared to the pricing for BW which was not necessarily easy to explain. Yet in order to make HANA what it is supposed to be in a near future SAP needs to make sure that the partners are not only betting on it like they do now (still the new kid on the block that everybody wants to play with), but they will be able to make money (this is what it is all about) in order to continue to bet on HANA in a nearer future.
This is the part that I am personally more familiar with so I might be more explicit. I have seen so many of the renowned names in my Territory (Spain, Portugal, Greece and Israel) which are still trying to see the HW for SAP HANA as if it were yet another server. There is not use to tell a customer that a particular SAP HANA Server could hold up to 2TB of RAM if
a) it is not certified by SAP
b) if it is not certified by SAP you cannot install HANA for production on it
This is just one of the example which I could extend endlessly. In case that SAP will continue with the very rigid SAP HANA Appliance specifications they should also make sure that their customers get familiar with it and not make it pure commodity.
SAP HANA Appliances all have to comply to SAP specified standards and there are differences
I have seen now quite a lot of different approaches by the different SI and I tend to believe that the approach of “T-Shirt Sized” Migration Models makes a lot fo sense since after all most pieces around SAP HANA are in T-Shirt Sizes.
– SAP Pricing
Until now SAP had a very simple discounting rule for SAP HANA on BW which was 0%. It is quite aggressive and not easy if you consider that in some cultures the word is Discount is being used just like a salutation but very respectable. The downside to it are
- Customer want to be able to negotiate and not being able to do so can be a direct NO!
- The budgets of our customers are the ones they are if they spend 100 on Software Licenses out of a 150 Budget this leaves then only 50 for HW and Project which in turn puts then all the pressure on the HW and SI Partner. I have seen the craziest things happening here
- SI delivering projects for 0$ just in order to have a reference, with limited SAP HANA License sales the ROI is more than questionable
- HW partners selling huge SAP HANA ScaleOut Solutions far below cost (you can ping me and I will share the details)
– What is the real Performance improvement?
I have seen in the last 2 Pilots that the performance for a BW system did in fact increase but far below the very high set expectations. This has led some of the customers to either postpone the project or look for other alternatives
– Lack of Joint Approach / Deal Orchestration
I have had some very good conversations with Vijay Vijayasankar regarding this matter since today I am seeing to many deals in which the SAP partners are letting the last drop of blood in front of the customer, which simply cannot be in the interest of anybody since a non-sustainable business is never good business. In most cases this deal orchestration should be driven by SAP in order to make deals win-win-win-win.
– Where is really the value ?
I have heard some interesting phrases like:
- You need to make sure that you put the HW vendors to compete against each other in order to get a competitive price. They are btw all the same…
- Ask your HW vendor to detail the price of each component they are offering you…
- Get 3-4 SI and make sure they all know that you have this project and you will see how the price goes down
The funny part about it is that SAP HANA has 0$ value without Hardware below it. Neither does it deliver any value just sitting on the shelf, or worse being poorly implemented. SAP HANA makes only sense in the conjunction of all. But regarding the phrases I have taken as example (which by the way hurt a lot) there is one thing that amazes me. SAP HANA is a Software so the cost that SAP per customer they sell to is absolutely linear. It is does not matter if a customer buys 30TB or just 64GB the code is the same and thus the cost whilst on the HW side theres is a severe cost difference as well as on the project side. Funny enough nobody questions the SW part.
So what is the Point here ?
I think we are all here to make SAP HANA a success. So since we are all wanting this to go the right direction I think we should find ways among all of us to stop looking at each other in a way like the one next to us is earning more and this is unfair and move to real collaboration and once more I think this should be led by SAP. If we continue to kill ourselves in front of the customers and further this is being “instigated” by SAP I fear that the success will be coming much slower if at all. Crossing the Chasm is not just done by excellent marketing it requires a lot of people rowing in the same direction and fully motivated as well.