It is almost 18 months since SAP released business suite on HANA. They now claim a little over 1000 customers have jumped aboard – although the number that are running in production is significantly less. This is hardly a ripple on the surface – in fact if we take SAP numbers at face value there are more startups using HANA than Business Suite customers.
HANA is brilliant, HANA is great, yada yada yada, but the adoption rate is pretty underwhelming. And that makes sense because HANA is a platform and no one needs a platform until you have something to run on it. To achieve mass adoption a killer app or, even better, several killer apps are needed.
When the personal computer first appeared last century most people, and especially enterprises, responded with a “meh”. The killer app that drove mass adoption of the personal computer was the spreadsheet. Once the CFO saw that he fell in love and away we went.
I was invited to take part in the SAP Influencer Program at SAPPHIRE NOW and ASUG Annual Conference last week. While there I think I might have seen a potential killer app for HANA. And guess what – it is SAP Financials!
Of course SAP don’t call it that, and they have muddled it up inside messaging about HANA Enterprise Cloud and a cloud-only offering called SAP Simple Finance. New SAP CIO Ingrid-Helen Arnold demonstrated it during Hasso Plattner’s keynote (replay here) – and it rocked! The business types in the audience I spoke to were very impressed. With a little sharpening of the messaging SAP could have CFO types all over the customer base falling in love again.
When Arnold drilled down on Operating Margin from the above dashboard screen to the screen below there was no perceptible delay and she claimed the application had analysed 380 million records in the process.
The current name of this thing is, I kid you not, “Financials Add-on for SAP Business Suite Powered by SAP HANA“. I’ll call it SAP Financials because it is in essence just the latest update to that application which will be available to all existing customers. But of course the cool new ‘simplified for HANA’ stuff by definition requires HANA. If you are not running on HANA then bad luck. And all this ‘simplification’ has just begun. SAP Finance is just the first piece of the SAP Business Suite to be ‘simplified’.
Note – it’s not a bad non-disruption story either. SAP themselves upgraded their in-house ERP systems a bit over a month ago and none of their Business Suite users noticed – with the obvious exception of those that use SAP Financials.
So here is the kicker. HANA needs widespread adoption to be successful. Good technology alone will not succeed if it doesn’t achieve mass adoption. Anyone else, like me, buy a Betamax format video player? SAP Financials could be the killer app that drives adoption of Business Suite on HANA, and therefore HANA itself, within the existing SAP customer base.
I would like SAP to recognise that adoption of Business Suite on HANA is the most important thing to them – more important than anything else. That means doing everything possible to remove any “friction” that will impede adoption. The first big issue here is pricing. Let me be very clear – this is an update to existing SAP Financials. Sure it takes advantage of the unique capabilities of HANA but that does not make it a new product. Customers who have bought SAP Financials have been filling SAP coffers with maintenance euros and dollars for years – their expectation is that this type of innovation is exactly what they have been paying for.
Of course some SAP people disagree with me. SAP is currently planning to charge a “small license fee” for this update. When challenged they cite “revenue recognition” as one of the reasons for this. Whatever “revenue recognition” is – it seems to me it is a SAP problem not one that should be passed onto their customers. The pricing issue is friction, and friction will slow adoption. So if adoption is the most important thing there could be a short meeting at SAP between the strategy people and the execution people that clears away this issue. (There are other issues of friction I might cover in another post.)
If SAP can get the new SAP Financials to GA status quickly, if they can remove all possible friction, if the CFO’s fall in love – some amazing things could happen.
For a start at every opportunity a smitten CFO would stand up and talk about how happy they are with the latest SAP Financials. People do that when they are in love.
Other dissatisfied CFO’s would seek to get the same feeling. And suddenly instead of 1000 SAP Business Suite on HANA customers there might be 10000, or 20000. And that would mean HANA, Business Suite on HANA, and probably even HANA Enterprise Cloud will have crossed the chasm.
It makes pretty good sense to me – but what would I know right?