As HANA matures, where should SAP focus?


It is not news that SAP is betting the farm on HANA. SAP’s sales and marketing organizations have done a tremendous job in making sure the HANA message is delivered loud and clear to its customer base.  SAP sold more that 100M Euros worth of HANA last year , and will probably do much bigger numbers this year too.

 

BW on HANA is already out, and is touted as a killer app. It might very well be a killer app – but that remains to be seen. In our internal lab projects, it is not as smooth as we expected. It is a bumpy road – but it is definitely fast. DSO activation for example is super fast, but it will also fail inexplicably, and then the time you save in activation is lost in trying to research what went wrong. The good thing is that since we know it is very fast, despite the teething problems – I am sure lot of customers will buy it. And to a certain scale, software is sold in bundles any way – so nothing will stop SAP from selling HANA licenses. Customers actually using HANA in production is another story altogether.

 

Buying is just a first step – the bigger question is who will implement. As of now, mostly SAP PSO is doing the implementation. But that is not a scalable model at all. PSO cannot satisfy the market by themselves, and SAP should be aggressively pitching to SI partners to sell and implement BW on HANA. You get some benefit by just doing a database switch to HANA, but the real benefits come from simplification – which means redefining the datamodels and data flow.  And that takes time and expert industry knowledge , and not just technical skills.

 

SI partners are terrific at implementation, and building accelerators for implementation. However, what they are the best at is NOT building apps. For apps, it is the smaller developer’s world. But then, SAP HANA is not yet available for smaller developer to do something about productively.  SAP has made a good first step. A sandbox is available for them to play with. But it is not a full development environment they can create a product, license it and sell it in a store.

 

So on both sides – implementation and apps building, SAP has some ways to go. If they don’t get their act together in short time, next year – we will start hearing the HANA shelfware stories.

 

There has been some announcements meanwhile on HANA for SMEs that I saw a few days ago. I am not convinced how SAP is going to sell HANA to SME clients. SME is primarily a market for hosted systems – public or private.  Why would they care about the nuts and bolts of the database that their system is based on? They just expect it to be reasonably fast.  As I mentioned to few friends on twitter – not verbatim –  “If I hire a landscaper to mow my lawn, why would I care if he uses a Black and Decker electric machine, or a manual push mower?”. I don’t – I just pay the guy to mow the lawn, and will hire another one if the first one does not do a decent job.  If there are special apps that are HANA based that give me a positive top line impact, there is a case to pay a premium for HANA. Otherwise, I doubt this will fly.  Especially after companies like Workday have made their cloud offering in-memory based fully and not charging specifically for it, it is hard to ask a customer to pay a premium for modernizing an old system.

 

Once BW on HANA is out of the way, obviously SAP will come out with ECC on HANA.  With most of the heavy lifting in ECC done in ABAP layer, customers will not see any huge benefits buying HANA as a database. And it is a few hundred million lines of code – so SAP is not going to rewrite everything in ECC to work on HANA. This essentially means SAP needs to build more things like the CO-PA accelerator, and more specialty apps for ECC that needs HANA.  Which then needs the small developers and SIs to play a big role to scale it meaningfully.

 

So, will SAP make the effort and actually make it work for the small developers and SIs ? or will they try to do it all by themselves?  And while they are at it – I hope they try to make this work for mobility, cloud and everything else too.  one approach – is to stay the way it is now. SAP will try to create the market, with the hope that some day in future partners can scale it. Or they can make it work for partners and smaller developers right upfront, and build a larger momentum.

 

None of this is new to SAP – several people have already made the case to SAP on these matters. And to SAP’s credit, they are good listeners. Now the only question that remains is when they will act.

 

 

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12 thoughts on “As HANA matures, where should SAP focus?

  1. Thank You. Can you brief a bit more on what would be the role of a BW consultant from the HANA implementation perspective..

  2. Vijay, very good article. Thank you.
    How do we classify the skills of HANA, is HANA going to be supported by the current DBA’s who are supporting Oracle/SQL/DB2 on SAP or the BW consultants will support HANA..??..I dont get a clear picture on this yet.

  3. Its quit not clear yet, is HANA a database or a IN memory performance tool or its both.. if its both then whats difference in this HANA database and any other IBM,oracle, microsoft databases that are currently supporting SAP ECC/BW…

  4. I agree with your analysis. It is true that ECC won’t see huge performance benefits on their processes running on the ABAP layer and SAP should be clear with their customers to set their expectations accordingly. On the other hand, if they are allowed to model their own views in the same DB as their ERP, they will probably be able to have much better reporting capabilities (using BO products) and definitely faster without the trouble of replication.

  5. Great points, agree with most except the apps development area. In my mind in the near future SIs will also play a role in apps purely because they have a scalable offshore presence and application maintenance support practices that can support such apps. It’s just another avenue to grow and I think with some smart planning, accelerators could in turn become consumable apps with very little additional work. What do you think?

    • HANA is new, and hence we speculate. but ECC has been around for ages now. How many bolt-ons came from SIs ? With all the experience and offshore and all that, SIs did not play a big role in developing apps. However, SIs did play a big role in implementing these “apps”. That was the background of my comment.

      • Fair enough but I am talking about the future business model. SIs didn’t get in to bolt-on earlier because there were bigger and better areas to focus the energy on. Though the bigger and better areas still exists, the pond is getting crowded. I think the next area would be to “also” capitalize on commoditization that has been built over 2 decades. That’s just my opinion..

  6. The SME play might be more HAAS (Hana-as-a-service), somewhat like Gooddata, perhaps. I’m quite interested in seeing how *small* HANA can scale (not just technically, but commercially) to create an OEM/embedded market for the technology.

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