From R/3 to Run Simple – How Much SAP Has Changed!
I’m not sure I should admit how this blogpost came about, but it’s funny, so why not? I was updating my LinkedIn profile, as you do, and found myself trying to explain why I have only been at SAP for the last 15 years! I realised that it didn’t feel really like that, partly because I have done different things and lived in different places, but also because SAP has changed unbelievably in that time. So much so, in fact, that by the time I had finished explaining it, I had exceeded the maximum length of a LinkedIn summary by 1000s of characters! In the mean time, I’ve finished the LinkedIn summary, but I couldn’t bring myself to delete the long version, so here it is ;o)
Personally, I think the *real* change started with the acquisition of BusinessObjects in 2008. This was the first *big* acquisition of SAP. It was SAP admitting, after 26 years (!), that the World of business software was now moving too fast to build everything yourself. If SAP has not realised this, I believe it would be quite irrelevant today, but, luckily, nothing could be further from the truth! SAP went on to do other strategic acquisitions, such as Sybase (in 2010), to get a lead in the mobile space, SuccessFactors and Ariba (both in 2012) to get into the cloud and business networks, hybris (in 2013) to turn CRM into omnichannel commerce and, most recently, Fieldglass and Concur (both in 2014, Concur still to be approved) to strengthen the Ariba Network and build the biggest (“omnicategory”) Business Network the World is ever likely to see. I recently pulled together all the Gartner Magic Quadrants and Forrester Waves I could find and found that SAP is a Leader in 31 out of 35 of them! A lot of this is thanks to these acquisitions and it just goes to show that, when SAP buys, it buys the best! It also pays good money, but hey, you get what you pay for ;o)
Today, SAP still has all of its traditional strengths (more integration than anyone else; industry solutions, knowhow and references; truly global reach etc), but it also has one of the broadest, largest and fastest-growing cloud businesses and by far the largest Business Network, which will make SAP the “Google of
business data” and lead to all sorts of new opportunities for its customers. As it that wasn’t enough, SAP took the wind out of Oracle’s sails (which is funny,
if you know what Hasso Plattner and Larry Ellison like to do in their spare time ;o), by re-inventing the database right in front of their eyes. I’m talking about SAP HANA, which is a completely new way of managing data and building software, comparable to going from the horse-driven carriage to the car. Okay, so we don’t always do a good job of explaining HANA (and some people even complain of HANA-fatigue!), but the more time you take to understand it, the more you will realise how revolutionary it really is (and that’s why we can’t shut up about it!) and what incredible things it can do for a business, especially in combination with the cloud, the Business Network, big data, the Internet of Things and so on. The possibilities are endless!
Great technology is one thing, but deploying it in the real World is something else, and the one thing stopping them from doing that is complexity, both in business (layers of management, complex-decision making, complex business processes, many approvals etc) and technology (number of applications, vendors, releases, databases, integration etc). Earlier this year, SAP made it its mission to rid customers of this complexity and “Run simple”, so they can grow and innovate. Many people find this ironic, because SAP has been known for the complexity of its own products and processes. It’s fair to say that SAP has sometimes made things more complex than necessary, but, at the same time, SAP has 42 years of experience, in helping many of the World’s largest and most complex organisations solve their most complex business problems, and we believe you have to understand complexity, before you can beat it. Bear in mind that “Run simple” does not mean “doing simple things”, like many of our niche competitors arguably do. It means doing the same complex things as before, but in the simplest possible way. As Albert Einstein said, “Everything should be made as simple as possible, but not simpler.”
Having said that, the onus is on SAP to simplify every aspect of its own business – including its products, pricing and processes – and that is exactly what it is doing. Personally, I am amazed at the fast pace at which all of this is happening, but I do also understand the scepticism of (other) SAP oldtimers, who say, “SAP has tried to simplify itself before and it never really worked. What is different this time?” Well, a group of us recently asked that question to our Global Head of Strategy, Deepak Krishnamurthy and his answer was surprisingly… simple ;o) He had two reasons. Firstly, this is the first time the simplicity has been the TOP priority, across all 6 Board Areas, at the same time. Everybody knows it’s not an option anymore and there are no excuses this time. Secondly, we now have technologies that promise massive simplification and are ready for prime time, especially the cloud, to simply all aspects of software consumption (and development), and, of course, HANA, to simplify the IT stack and the customers’ IT landscape. When you (re)build an application on HANA, it becomes much smaller (factor 7-20 less lines of code) and much more powerful at the same time. It’s like having a car with a very powerful engine, but also a very small and light one, which makes it very fast, but also very simple to run (in the cloud or on premise), maintain, extend, everything! SAP is applying this to its entire portfolio and it’s also using it as an opportunity to integrate all its products much better than before, so HANA is not only “the great simplifier”, but also “the great unifier”, and I’m convinced that customers will love it.
Hopefully, I’ve convinced you that “Run simple” is more than a marketing slogan! Personally, I have never felt more empowered to speak up when something
needs to be simplified and I do my own bit, especially in the area of strategy communication. As I also wrote at the end of my LinkedIn summary, Albert Einstein once said, “If you can’t explain it simply, you don’t understand it well enough.” And, if you can, your audience will love you for it ;o)