Many of us have surely heard more than once, and maybe more than enough, all these buzzwords (old and new), trends and hypes relating to concept such as Fog Computing, Edge Computing, IT/OT convergence as well as the newer or reworked ones such as IoT, Industrial IoT, Industrie 4.0, Empowered Edge, Autonomous Things, Osmotic Computing and the list goes and will go on…
Today we don’t want to know anymore what are the latest smart technologies that will revolutionize the market, how many connected devices are we supposed to have by year so-und-so, about the latest micro-vertical killer-apps, or whether or not the above-mentioned trends and hypes are going to change our life as individuals.
“Bring together Business and Physical Processes
by embracing novel technologies”
That’s why I decided to approach our experts at SAP Security Research with the mission to (please) not to deep dive into the specifics of all those above mentioned concepts, but rather to explain to the company and to our ecosystem how does SAP intend to embrace these for the sake of progressively building and delivering added business value for our customers.
And no one can articulate this better than our SAP colleagues José Márquez, Chief Digital Officer for the SAP Labs Network, and Dr. Laurent Gomez, Co-Innovation Lead at SAP Security Research. They are leading/driving/shaping SAP’s thought leadership on the topic of Distributed Enterprise Systems, being active already for half a decade through various scientific publications, patents, external contributions (from renown research conferences, ecosystem events to the very SAP Select 2019) as well as internal guidance around portfolio strategy and technology adoption (e.g. Secure Internet of Things). Particularly notable is their award-winning co-innovation work with the French Public Sector (refer to page 13 of the SAP Run with Purpose Booklet 2019) together with Schneider Electric and NVIDIA, as well as their most recent publication on Springer Nature.
This time around I decided to challenge them by asking candid and #Unfiltered questions on the true business relevance for SAP of the aforementioned technology trends.
A: Laurent, José, let’s talk about Edge Computing, Fog Computing, IT/OT Convergence, IoT, Industrial IoT, Industrie 4.0, Empowered Edge, Autonomous Things, Osmotic Computing…what is actually enabling the rise of this specific category of technology-based trends?
LJ: Hi Antonella, we can say that this has its origin on the recent advancements in hardware and communications, targeting bespoke on-site deployments of software (i.e. sensing technologies, hyper-connectivity, computing-power) together with an overall decrease in hardware size and price. This is the quintessence.
A: OK, and what do all these terms (here again: Edge Computing, Fog Computing, IT/OT Convergence, IoT, Industrial IoT, Industrie 4.0, Empowered Edge, Autonomous Things, Osmotic Computing) really mean for the business of our customers? In one sentence please.
LJ: Those concepts, partially overlapping, point collectively towards the vision to bring business and physical processes together, at the enterprises, ecosystems and economies.
A: Is there a word for this (i.e. to bring business and physical processes together)?
LJ: That’s a good question, not actually one but three: Distributed Enterprise Systems. This is the term which has been coined by SAP after years of research and strategic co-innovations with selected customers.
A: Bringing business and physical processes together sounds catchy, but what are the concrete advantages for our customers?
LJ: If our customers are able to end-to-end streamline business with physical process (intra- & inter-company), the possibilities become endless; our customers will then be able to boost their existing business models, unlock new ones, even participate in novel target economic models; they will also be able to enhance their existing business capabilities.
A: Could you briefly share with us some concrete examples on the business models to be boosted, the new business models to be unlocked, one main target economic model and how existing business capabilities will be enhanced by bringing business and physical processes together?
LJ: Sure, there is well-known academic research work on all these topics. Basically, the boosted existing business models are for example: add-on, direct selling, fractionalized ownership, freemium, guaranteed availability, pay-per-use, multi-sided market.
The new business models are those on object embedded services, physically reachable services, sensor as a service, and business-platform as a service, at least.
In terms of target economic models, the mainstream focuses on the so-called circular economy, which is well known by the way it embraces different industries and ecosystems fostering efficiencies among all parties.
For the how business capabilities will evolve leveraging the adoption of new technologies, we can refer to the work of Gartner on this subject, i.e. dematerialization, disintermediation and democratization of business capabilities.
A: OK! Now, it is surely interesting to know how this is going to be possible from a portfolio perspective. Do we develop things from scratch in order to deliver the vision on Distributed Enterprise Systems?
LJ: No at all, actually we couldn’t be better off for this endeavor. On the market of Distributed Enterprise Systems, SAP is in a unique and unmatched position to :
- Capitalize on SAP’s data, by distributing selected Digital Core (i.e. business processes related) data assets into the places where these could be aggregated with those (physical processes related) data assets; enabling by this, unique and competition-less real-time insights.
- Capitalize on SAP’s processes, by decentralizing a selected scope of Digital Core business processes towards the places where the physical processes are being executed in order to offer unmatched capabilities and integration.
- Capitalize on SAP’s frameworks, by delivering the above within the well-known enterprise grade SAP lifecycle management, compliance and security frameworks in order to enable our portfolio, customers and ecosystems on the adoption of Distributed Enterprise Systems.
A: Tell us more about the SAP frameworks aspect, what is actually meant by that and why do they represent a unique value proposition for SAP?
LJ: The frameworks are actually the secret sauce of SAP. From a high-level perspective, our frameworks (e.g. Security, ALM, Compliancy, Industry Standards, Resiliency, etc) are actually the ones that enable and catalyze a durable adoption and operation of SAP software ever since.
While infusing our solution portfolio with innovations – on business & technology – our strength will always reside on our capacity to embrace, productize and deliver those innovations through our frameworks, i.e. in a standardized and in a durable way.
A: Right, and now, speaking about the security aspect of our frameworks, McKinsey recently reported that “the number and severity of cyberthreats continue to grow exponentially as the world becomes increasingly connected…“. Don’t you foresee similar risks along the way towards the vision of Distributed Enterprise Systems?
LJ: Well, surely there will be a number of challenges on our way, speaking specifically about security we expect to basically recalibrate our risk management strategy. Distributed Enterprise Systems will have by definition a wider attack surface and therefore already known vulnerabilities could be amplified, at the same time as new threats will certainly arise. To put it in perspective, while bringing business & physical processes together, cybersecurity and physical security will have to converge.
In this regard, SAP has the non-transferable obligation of delivering a security continuum. In the future, as of today, any proposed ways to adopt the vision of Distributed Enterprise Systems will have to attain established & always evolving security standards, this, agnostically from the underlying technology. As an ultimate consequence, all Enterprise Systems (including Distributed Enterprise Systems) are to be securely provided & consumed.
A: And apart from this nice vision and the good thought leadership work, where are we actually getting concrete traction here, any customers or partners?
LJ: (laughs) You’re right, it might sound very theoretical! But we have been and are still engaged quite concretely with selected customers, materializing this vision. For instance, we have so far co-delivered through the following engagements:
Process Industries with Pepperl+Fuchs and BASF on Chemie 4.0 (see IT Gipfel 2017)
Industrial Manufacturing with Schneider Electric on Software Defined Automation
Utility Management within Public Services with the City of Antibes on Future Cities (see page 13 of SAP Run with Purpose Book 2019)
A: Wow, it looks like you have successfully managed to navigate those times of changes and transformation while working on this topic. What’s next, what can be expected for 2020 and beyond?
LJ: A game plan for a holistic portfolio impact is to be crafted within and among the different development units during H1 2020, we can’t tell more about it for the time being, but we’ll keep you posted! 😊
This is an edited interview with:
- Dr. Laurent Gomez, Senior Security Researcher Expert, currently Co-Innovation Lead for SAP Security Research, based in Sophia-Antipolis.
Check out his profile on Dr. Laurent Gomez / LinkedIn
- José Márquez, Development Architect formerly at the Business Suite and IoT&DSC, currently the Chief Digital Officer of the SAP Labs Network, based in Paris and Walldorf.
Check out his profile on José Márquez / LinkedIn
Gartner Top 10 Strategic Technology Trends for 2020, October 2019
City of Antibes, Catalyst Award, Green Electronics Council, 2019
Security for Distributed Machine Learning Based Software, Springer Nature, November 2019
Business Models and the Internet of Things, Bosch Internet of Things & Services Lab, 2016
Three Emerging Trends Driving Digital Business, Gartner, 2015
What Does Enterprise Grade Really Mean?, Forbes, 2013
Digital Manufacturing – escaping pilot purgatory, Digital McKinsey
There’s No Halfway To ‘Enterprise-Grade’, Forbes, 2019
Preparing for Physical and Cybersecurity Convergence, Security Magazine, 2019
Ten trends shaping the Internet of Things business landscape, McKinsey, 2019
Chemie 4.0: die Prozessindustrie erfolgreich digitalisieren, SAP News, 2017
Run with Purpose, SAP Booklet, 2019
How IoT is turning this French resort town into a Smart City, sap.com, 2017