I am just returning from SAPPHIRE with my head full of all the new innovations wondering if I just saw R/4.

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It wasn’t called R/4 it was called Simple Suite (see Bernd Leukert discuss it roadmap in his Keynote The Future of Enterprise Applications – 2 hours and 16 minutes in)

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Reactions to it made me think about conversations I overheard at the start of my career in 1992 when R/3 was release. The company I worked for was running R/2 (the mainframe version of SAP for those too young to remember) and many people were sceptical about this young upstart call R/3. There concerns were something like this.

  1. New Platform : Was it “safe” to trust your business to this much cheaper and more flexible hardware landscape called client-server ? Didn’t real businesses have to run Enterprise Systems on mainframes that cost millions ?
  2. New Code : Was there really anything new in the box ? It looked like SAP had just ported R/2 code to R/3 ? Some pointed to the fact that many of the programs / tables had the same names. People understood the way R/2 was configured (often via tables of switches) and they were suspicious about the configuration menus (that would become the IMG)
  3. New User Interface : Did we really need this new user interface called SAPGUI ? GUI’s (Graphical User Interface) and menus were all the rage at the time, but many of my then colleagues who knew all the R/2 transactions and could “tab round” their green screens, saw SAPGUI as a toy that wasn’t required.

As we all know it turns out that the Platform could run Enterprise Systems and was the death of Mainframes in many organisations (certainly the one I worked at didn’t have one by the early 2000’s).  As for new code, it was true that much of the code base was the same as R/2, but the more flexible client-server platform and more open standards meant that SAP developers could do things that were not possible on R/2 and the features available in R/3 soon outstripped those of R/2. Finally SAPGUI and those configuration menus made the system accessible by a whole new group of people who could configure the system without being a mainframe expert and end users got features like on-line help and role specific menus.

If I compare this to Simple Suite, I heard many of the same conversations this week at SAPPHIRE that sounded something like this :-

  1. New Platform : Was it “safe” to trust your business to this much cheaper and more flexible hardware landscape called the (HANA Enterprise) Cloud ? Didn’t real businesses have to run Enterprise Systems on-premise (or on dedicated hosting environments) costing millions ?
  2. New Code : Was there really anything new in the box ? It looked like SAP had just ported Business Suite to Simple Suite ? Some pointed to the fact that many of the programs / tables had the same names. People understood the way R/3 worked with database and application servers and they were suspicious about code push down and the XS engine.
  3. New User Interface : Did we really need this new user interface called Fiori ? We know that HTML5 and responsive design (screens that adapt to the device they are running on) are all the rage, but didn’t you still have to use SAPGUI to access all the detailed feature of Business Suite ? Fiori was just a toy that wasn’t required.

So we will have to see how this all plays out in the end but my prediction is we will look back on this SAPPHIRE in the same way that we look back on the moment that SAP unveiled R/2 at CeBIT.

  1. New (HANA Enterprise Cloud) Platform : Doesn’t it make sense that the company the writes the software would be better at running it and keeping it patched ? Why should companies using the software have to worry about this part ? Should they care if the system is running on HANA if the provider signs up to deliver a service at a monthly charge ?
  2. New Code : It is true that most of the code in Simple Suite will be the same as R/3 (Business Suite), the exiting point is that the new platform can do the same as the old one AND it can do new things the old one couldn’t. The first glimpse of this was Simple Finance, which does away with aggregate data, providing super fast on the fly analysis of financial data, eliminates reconciliation between FI and CO and hinted at predictive capabilities that couldn’t be imagined in the old landscape e.g predictive financial statements that alert to potential problems before they happen. I believe that this is only the tip of the iceberg – with SAP and their partners thinking of ways to exploit these new capabilities. Another key difference in the switch between R/2 to R/3 and Business Suite to Simple Suite, is that the latter is just a database switch (if you have kept up with Enhancement Packages) so you can bring all your old configuration across. 
  3. New User Interface : Whilst it is true that today you can’t access all the features of SAP via Fiori, I think the SAP direction is clearly that all new user interface will be HTML5 (using SAP UI5) and with a combination of Fiori and Screen Personas (which will get HTML5 capabilities), the way users access SAP in the future will be via HTML5. Further more behind Fiori is an architecture that can be used by customers and partners to create role / industry specific screens. SAPGUI may not be dead, but you will see less and less of it over the coming years. Perhaps later this year we will see the first group of SAP users who will never have used SAPGUI (like I never actually used green screens).

So what should SAP customers do today. One option is nothing (not something SAP would recommend) another would be to call SAP and sign up to HEC (something that would please SAP a lot 🙂 ).

What I believe most should do (and some are doing) is start to plan there way to HEC (or the on premise equivalent if your industry / country rules mean you can’t consider the cloud). At a high level this will mean the following (they are listed in no particular order – they just need doing) :-

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  • SAP HANA Roadmap : For those that want to get confidence in this new platform call HANA, look at the options you have to get it into your landscape and select the one that delivers you the most benefits at a risk profile that is acceptable to your business. Many organisations have started there HANA journeys with BW, but an increasing number are looking to start with new HANA powered applications like Operational Process Intelligence powered by SAP HANA which enables real-time end to end process monitoring – and is be deployed in a non-invasive way.
  • New Releases : Review all your modifications and custom code and remove as much of this as possible whilst upgrading to the latest enhancement packages and support packs that are required for the switch to Simple Suite (I believe this is EhP 7 for ERP). Also consider if some of your features could be replaced with their cloud only offerings e.g HCM to SuccessFactors and SRM to Ariba. It is also worth understanding the HANA Cloud Platform and the key roll that this will play in “personalizing” your SAP systems in the future (see SAP River – Rapid Development Environment (RDE)).
  • Real-time Integration : Whilst doing the above take full advantage of the possibilities to simplify your SAP landscape by running as few versions / instances as possible and removing dual stack systems where possible. This is particularly true for the NetWeaver Java products many of which can now co-exist e.g Process Integration, Business Rules Management and Business Process Management become Process Orchestration. The fewer systems you have the easier the switch to HEC will be.
  • User Experience Roadmap : Now that Fiori and Screen Personas are included in your user licence, get them out of the box (along with SAP (NetWeaver) Gateway) and start to re-think the way your existing (and new) users will interact with SAP. Also look at the advanced integration capabilities of Process Orchestration to ensure that all interactions with the platform are controlled in real-time for both system to system (A2A and B2B) and human to system processes (workflow).
  • Roadmap to the Cloud : Start the conversation with SAP (or one of their HEC Certified Partners) about HEC to judge if this managed cloud is affordable and practical for your organisation or if you need to keep your systems on premise.

One thing is clear to me – it is not a question of if you will use HANA – but a question of WHEN.

I believe that those that stay off HANA / Simple Suite / Fiori the longest will see little for their maintenance payment, with most innovation happening in or around Simple Suite (for large enterprises).

And I managed to say all that without mentioning exploiting Big Data, Predictive Analytics, Mobility and Social……I’ll save that for another blog once the jet lag has worn off.

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7 Comments

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  1. Bala Prabahar

    Nice job. A few thoughts:

    1) Not sure why Business suite on HANA – released last year – is missing in the diagram. 1000+ customers are running Suite on HANA.

    2) In 1992, SAP had ~2,200 customers in R/2. Almost everyone in R/3 is new customer. They probably moved from another environment of multiple systems to single ERP R/3 system for multiple reasons, Y2K probably being primary one. In other words, they had an (or multiple) issue(s) to solve. For current customers, what issue would they solve by moving to Simple Suite? I see one in your blog: Most innovation happening in or around Simple Suite. Any other reasons?

    3) In 1992, SAP didn’t have as many modules as today. BW didn’t exist then. Not sure how BW & Simple Suite can coexist. Aren’t they built based on fundamentally different principles? (or would BW be relevant only for those customers who use it as an EDW with non-SAP source systems?)

    4) Last year SAP released Business Suite on HANA. My understanding was that they rewrote original code to take advantage of HANA. Where possible & viable, SAP tried to use similar logic (Stored Procedure being one)  for other RDBMSs as well. Is Simple Suite a change in strategy between last year & this year? Is SAP rewriting Business Suite second time since the introduction of HANA?

    5) Last year SAP recommended 3-tier landscape for Business Suite on HANA. Is that recommendation still good for on-premise version of Simple Suite or the customers can get rid of application layer?

    Regards,

    Bala

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    1. Owen Pettiford Post author

      My answers in << >> below

      Nice job. A few thoughts:

      1) Not sure why Business suite on HANA – released last year – is missing in the diagram. 1000+ customers are running Suite on HANA.

      <<Owen – Because this the just same stuff on HANA and not a real evolution – IMHO)

      2) In 1992, SAP had ~2,200 customers in R/2. Almost everyone in R/3 is new customer. They probably moved from another environment of multiple systems to single ERP R/3 system for multiple reasons, Y2K probably being primary one. In other words, they had an (or multiple) issue(s) to solve. For current customers, what issue would they solve by moving to Simple Suite? I see one in your blog: Most innovation happening in or around Simple Suite. Any other reasons?

      <<Owen – That would be the main reason>>

      3) In 1992, SAP didn’t have as many modules as today. BW didn’t exist then. Not sure how BW & Simple Suite can coexist. Aren’t they built based on fundamentally different principles? (or would BW be relevant only for those customers who use it as an EDW with non-SAP source systems?)

      <<Over time BW will be rolled into to Simple Suite (I think) – if not it will use tables directly from Simple Suite for SAP data – not more load windows>>

      4) Last year SAP released Business Suite on HANA. My understanding was that they rewrote original code to take advantage of HANA. Where possible & viable, SAP tried to use similar logic (Stored Procedure being one)  for other RDBMSs as well. Is Simple Suite a change in strategy between last year & this year? Is SAP rewriting Business Suite second time since the introduction of HANA?

      <<They just improved existing features (which was good) – Simple Suite will bring lots of new stuff>>

      5) Last year SAP recommended 3-tier landscape for Business Suite on HANA. Is that recommendation still good for on-premise version of Simple Suite or the customers can get rid of application layer?

      <<You sill need the 3 tiers for the classic stuff – but lots of the new innovation will not need the ABAP/JAVA Stack and run directly on the HANA Platform>>

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  2. Vineet Gupta

    Great job summarizing the message. All of us have been waiting for SAP to use HANA creatively in their own application. Looks like we are finally starting to see the signs now….

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  3. Twan van den Broek

    Great comparison to the past. Your explanation is what SAP should use to convince its customers. There is no innovation without disruption. Make sure you’re prepared!

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  4. Markus Theilen

    Great job, Owen!

    I have to send the link to your blog to my colleagues to wake them up from their R/3 sleep mode. 🙂

    I totally agree with your thoughts but I also see a lot of work of communication for SAP to make their ideas and roadmap clear to the customers. And even if I personally believe that the SAP cloud offerings are at least the second best after sliced bread, there are a lot of IT managers out there that don’t go easily into cloud offerings.

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