By this time, there have been already many blogs, many discussions around what we saw and heard in the SapphireNow 2014 in Orlando. But I wanted to reflect a little to understand what all of these information we got during this 3 day conference really translates into.
SapphireNow has a unique ambiance, with the focus on the customers, on sharing the latest products in SAP, on showcasing the business results which various clients have achieved through application of these latest product innovation from SAP. For the partners, its about showing off the strengths of different product and service offering. With 250 odd partners in the show floor which lived up to its name, it was a lot of showbiz and glitz, with everything in between magic shows, simulation games to goodies to lotteries – everyone vying for attention. There are too many things to reflect on but I have, for this blog, concentrated on the impact of the mantra “Simplify”.
While SAP CEO Bill McDermott talked about the growing problem of IT complexity in the client business today and the solution of making it all
simple through the various technology like SAP HANA, like cloud, I was thinking of the complexity of such transformations. The concept of system simplification has been there in various avatars and there have been some typical challenges.
The clients need to go through a transformation project in order to simplify their IT landscape, their business applications and really free up the resources and bring down, as Bill mentioned , the cost the IT maintenance from its average 72% , to some number, drastic enough to make this investment of the
transformation worth it. So, what is that magic figure? The system simplification is often driven by IT and their direct business benefit is less obvious. If there is a transformation project which brings down the maintenance cost from 70% to 60-65% – add to that the cost of the project, whether or not this provides motivation enough for such a project?
Application owners may want to hold on to complexities as they feel that their business requirements are complex and their IT solutions are special and hence the simple solutions may not work out for them. So, there is an element of change management here and the Enterprise architect groups should get the application managers to see the value, the need to simplify and provide the options to do so.
Business also needs to be convinced that this transformation will pave the path for them to innovate, to have the ability to do analysis of any kind of data in real time using visualizing tools which are appealing yet easy to manipulate, in the meantime, no disruption to their business processes.
For all the above points, it really requires a concrete vision about the end state of the IT landscape. At this juncture, is it easy to have a long term vision for the IT landscape? The era where the EA could exactly envisage the landscape 5 years down the line is no longer there. Traditionally this vision of the end-state enterprise architecture takes care of the challenges of changing business need through flexibility, scalability. It can somewhat take into account evolving
technology, evolving SAP applications .
But how to take care of disruptive innovations? The radical change that can be effected in the standard SAP business applications like ERP on HANA database is evident from the Smart Financials on HANA release (April 2014). Hasso Plattner mentioned the same in his keynote – how SAP HANA simplifies the technical solution, bringing in dramatic reduction in tables and views.
Figure 1 – Source SAP
Simplifying the landscape to enable business users tremendously using making predictive analytics or any analytics with vastly improved visualization, to be able to harness the powers of social media, is a compelling enough reason for simplifying Business warehouse or EDW landscape but even then the cost factor, the time to enable these options is a large contributor to the decision. Some companies have adopted BW on HANA in 3 months while others have actually done process consolidation and simplification and effected such a migration to BW on HANA in 9 months. But today’s trend shows, because of the immediate impact Analytics has on corporate decisions, on even operational decision, marketing strategies, and also because the business transaction systems are not impacted, the adoption is much faster in this area
However, there are also other large enterprises who have been front-runners in adopting then cutting edge technology, who are now taking the giant leap of faith to adopt the disruptive technologies to simplify their ERP landscape. Many others are waiting to see the result of such adoptions before they decide on their course of action.
While HANA can be tagged as a disruptive innovation, cloud is something which has been there for some time now. But its adoption has really picked up in the last few years in terms of moving the infrastructure on cloud or platform as service whereas software as a service has gained a lot of momentum. While clients tend to move their development /sandbox/ testing environments readily on cloud, the move to getting their production boxes on cloud is slower.
The challenges of such situation is, apart from the longer term cost equalization, network bandwidth, regulatory norms related, security concerns (some times
unfounded), end to end testing, etcetera.
But more and more CIOs are considering putting their entire landscape on cloud, while some have done it already.
It cannot be one solution fit all kind of a situation when it comes to cloud and hybrid solutions with integration with on premise and on cloud systems have
become the norm.
From the User experience simplification point of view, while SAP Fiori vastly improves the look and feel of the Business suite transactions (300 odd applications have been created so far, as Bill mentioned), its still some way to go till this UI simplification is effective, with Personas supporting the classic dynpro screens currently. The simplification of the various kind of BO reports is also desirable while the UEx has been vastly improved but still there are too many options.
I must say that Bill McDermot’s first announcement that there would be no additional licenses for Fiori but its included now in the SAP Enterprise license was greeted with enthusiasm from the audience and am sure there must be quite some happy tweets or discussions around this announcement.
Some parting thoughts.
For the SIs , the challenge is, apart from adoption of all the new technology (which has always been there). the changing business content of Business suite and the paradigm shift in the underlying principal, as mentioned by Hasso Plattner in his keynote, that all the data should be available at the lowest granularity while its the business user’s prerogative to do the report modeling on top of that data.
The role of SAP and corresponding challenge, in this scheme of “simplify” is enormous :
- Be it simplifying their product portfolio
- Be it in terms of adopting their millions of line of code base in lines of the above
At the same time, I am wondering whether a version of this simplified solution will also be available for any other database using the in-memory paradigm, since otherwise, from business application point of view – it restricts the customers to SAP’s HANA database and prevents those on other databases from making use of SAP’s simplified business applications – the evolving Business suite.
Disclaimer : This blog contains the personal opinions/thoughts of the author.