After Larry Ellison Keynote, I Can’t Wait For SAPTeched 2012, Las Vegas


SAP Teched is just around the corner – about 2 weeks from now. The timing is also perfect – since SFDC and ORCL would have finished, and SAP will need to explain why it has a better strategy than competitors, without sounding defensive or reactive. After seeing the tweets from my pals who attended Oracle Open World, I am all the more curious about SAP messaging at Teched.

For the techie in me – SAP Teched is the ultimate event.For one, I can walk around without wearing a tie and a suit. Second, I get to hang out with a lot of techies way smarter than moi and learn from them. Last time in Madrid, Thorsten taught me River in 2 hours – may be less. This time around, I will be trying to get smart on Netweaver cloud – just need to figure out if I should bug Mattias Steiner or Dick Hirsch to be my teacher. And finally – I am always excited to hear what Vishal Sikka has to say in his keynote.

I am typing this from US Airways Flight 45 to Kona, Hawaii, for a week of vacation. The last call I had before we took off from PHX was from Vishal. He is never short on passion for what he does. And consequently, he never ceases to amaze me. He has a clear vision of where he wants to take SAP on technology front, and has never once been annoyed when I have given him some candid feedback. And one of the things that seems to be foremost in his mind is making sure SAP has a comprehensive platform strategy, of course powered by HANA. I expect to hear a good story from Vishal on platform direction in his keynote.

There are 3 things I expect to hear at Teched with respect to platforms . I already touched this subject in more detail in my last blog https://andvijaysays.wordpress.com/2012/09/21/sap-needs-a-better-cloud-and-platform-story-and-a-good-story-teller/

1. Is SAP’s platform strategy primarily inside out (protect the turf) or outside in (open to the world to do what the larger market cares about) ?

2. SAP historically has been a product company. What is the future? Is it aspiring to be a platform company or continue to be a mix of product and platform?
Both are valid and can co-exist – but SAP does need to express what is their priority for next 5 years or so.

3. When SAP did the netweaver messaging back in the day – it morphed from a big fascinating “change the world” type thing to “it is a good way to package today’s and tomorrow’s SAP products”. How will SAP avoid a repeat of this mistake?

The challenge for SAP is to build a platform story that does not sound like boiling the ocean, as Vishal himself says. And SAP needs to be specific. As Jon Reed would no doubt attest, at the last teched we could never get a straight answer from SAP executives on whether HANA supports multi-tenancy or not. And today, ORACLE went ahead and announced its DB is going to be multi-tenant. This is a big deal if your intention is to attract cloud providers to build on your platform. SAP needs to make sure its messaging and technical abilities don’t have a big gap between themselves. Multi-tenant database has some advantages in my opinion. It should at least in theory make it easier to build apps on top, and provide faster access to data than letting applications abstract in a layer above the database. There are of course architectural differences between ORACLE and HANA, but if those are not to an extent that a customer cares, then it practically won’t matter. Larry Ellison did not seem to tout any business use cases as far as I could tell from the tweet stream, so that is definitely an area SAP can outshine Oracle.

Outside the platform – I am keen to see if there is any further news on SAP’s database ambitions. ORACLE is a good example of a company who is in a financial sweet spot because it controls a fundamental layer in enterprise software stack. If SAP manages to get control of that share, it will be brilliant for them. But I am not going to bet on that happening unless there is a larger platform play that ecosystem buys into, and DB just happens to fit into it. I do expect SAP to come out with a larger number of HANA customers – I am guessing 700 +/- 10%. Any more than that will definitely make their competition sit up and take notice in my opinion.

As far as I know, SAP has no stated hardware ambitions. I am not convinced SAP can become a big cloud player without a HW play to go with it. They also need a more comprehensive datacenter consolidation/integration story to be taken seriously as a cloud player. I doubt this will change in Teched – but I really think SAP should consider it seriously

If the Ariba deal closes and legal teams allow it, I would like to hear how SAP plans to make use of its amazing network. I will be disappointed if Ariba is treated as just another cloud business. It might need to stand alone for business and organizational reasons, but I would expect to hear a platform unification or integration story.

Integration is a hard topic to deal with,to say the least. SAP will probably charge for integration, and not everyone will like that. We recently had a friendly debate on this on twitter. Customers generally do not always attach sufficient value to anything that is free. And SAP only have themselves to blame for getting customers used to huge discounts on list prices. So when a customer buys 2 SAP products and wants to integrate – should they pay extra? or should SAP just bake the price into other software? On principles of fair play – I think making integration free or very cheap is the right thing to do when both sides are SAP products. But I would guess that SAP sellers will probably throw in the integration as a deal sweetener to make the customer buy. So may be it all works out the same in the end.

Mobility has a similar challenge. Why charge extra to expose an existing application through a mobile device, when customer already pays for backend systems ? It is a nuanced discussion – due to the arbitary nature of defining what is existing and what is new. The answer varies between POV of customer and SAP. On the bright side, SAP does have a good strategy on MDM with Afaria. The rest of it just needs to evolve some more. But they are getting there at a fair clip, with Sanjay Poonen and team leaving no stone unturned. Pricing is much simpler to understand now too. I would really like to see Sanjay up on stage during one of the keynotes to explain the future of mobility.

One final thing I am keen to learn from SAP is the progress it has made with developer and start up initiatives. Without these succeeding – there is no point in having a platform to begin with. I know there are multiple people trying to make it work at SAP – and from outside looking in, I am not sure I always understand how everything fits in. It doesn’t matter really to me – as long as there is some concrete results to show.

I will close out this post with something I wanted to do for a while – a BIG shout out to Mark Finnern, the herder-in-chief of SAP Mentors. The Mentor program is not perfect – and Mentors will be the first to admit it. But we are all unanimous in our opinion, I believe, that without Mark doing what he did/does/will do – we probably won’t be as effective as we are. If I were in Mark’s job – I would have gone crazy a long time ago. SAP should be incredibly proud to have Mark as an employee.

SAP Needs A Better Cloud And Platform Story, And A Good Story Teller


This past week, there was a 2 day influencer event in Palo Alto where SAP explained (or tried to explain) its Cloud, Mobility and DB&T vision to about 16 of us. SAP paid for my airfare and hotel and ground transportation. Many thanks to Mike Prosceno and Stacey Fish – you are the best at what you do.

We started with cloud on Day 1 .  Cloud session was led by some of the smartest people I know in SAP, yet it did not go as well as I expected.  None of us in the room seemed to understand what the cloud story really is even after SAP tried a few times. As a technology fan, it did not matter to me that SAP had a sub par performance in the same week as Dreamforce was happening, but I am not sure if everyone else in the influencer gang look at it that way.

Sanjay Poonen and his team did the best job at the event when it came to explaining SAP strategy on mobility. I would say Sharron Ruddock, the COO for mobility, deserves special mention for  how well she explained mobility pricing. Steve Lucas and team took second spot – a close second I should say – with their HANA and DB&T story. And cloud brought up the rear.

If I travel back in time, when SAP execs were pitching ERP to customers, it was all about the business needs that ERP solves. It was not based on ABAP and Basis that a sale was made (which I felt bad about at the time, since I made a living as an ABAPer).  Fast forward to cloud era – and the whole conversation started with technology. Isn’t the whole idea about cloud that we don’t need to worry about technology as much as before?  SAP missed the boat on this one, and should try to revise the story line before their next attempt at Teched and SAPPHIRE.

It is not to say technology vision is less important – it is vastly important. But technology does not serve a purpose without tangible business benefits. If SAP has to succeed in cloud – it needs a VERY strong play as a platform.  This is also where that old DNA question comes to mind again. SFSF has the DNA for cloud based Apps without a doubt. But has that acquisition helped SAP inherit something useful for platforms ?  If it has, then someone needs to point it out, I did not see it.

There were a few highlights that definitely caught my attention. My friend Sethu, who is the deputy CTO at SAP, explained to things that are important.  The most important one is that SAP should not have multiple platform pitches – like mobility platform, analytics platform, Neo platform and so on. There should be  just one SAP platform going forward – which unfortunately does not have a name yet. Sad to say – this important memo did not reach the other parts of SAP in time. We got great explanations of mobility platform and Netweaver cloud platform right after Sethu told us there will only be one platform. The second thing that caught my attention from Sethu was that SAP is aiming for a unified semantic layer for everything that works on SAP platform. This is a much needed aspect of the platform story, and I am waiting to learn more about this.

SAP also has a good integration story that Nayaki Nayyar explained. I had met her once at Madrid last year, when we co-judged innojam before SAPPHIRENOW there. Cloud integration is critical to SAP’s cloud and platform future, and Nayaki explained that there is an integration technology they developed called Netweaver Cloud integration , and that it has two components – PI on demand, and Data services on demand.

The integration concept is webservices based. That is good – I get that, but that is not to say it completely reduces integration costs. It still needs harmonizing security, data, IDEs, and a consistent way to meter the services and components.

I am not fully convinced of the integration story on cloud. To begin with – I am shocked SAP positioned it as Netweaver brand. I don’t know a lot of clients who think of netweaver as a best in class integration platform. And calling its components as PI on Demand and Data Services on demand just gives the impression that SAP just repackaged something to make a new offering. Nayaki clarified that it is not so – and that it is all brand new.  I am sure I have said it before, and will say it again – without an acquisition story to go with it, I doubt SAP will have credibility in market with an integration story.  There are a variety of acquisitions possible based on what SAP can afford from TIBCO to snaplogic.

There is no MDM on the cloud from SAP in this whole cloud integration story. So essentially, one of the existing transaction systems will need to be treated as the master for the data that integrated systems will play with. I am sure this is just a matter of prioritization for SAP on where to invest for short term. While this is ok in convincing bloggers, I am not sure this is a good story to tell customers who typically need a longer term roadmap. Not having an MDM on cloud story makes it harder for them to buy into this integration strategy in my opinion.

I liked the analogy that Aaron Au used (he is the SFSF CTO, and a very friendly guy) of how Amazon evolved from “it is all about the shopping cart” to “shopping cart is just a small part, and only used to close a transaction” to explain how SAP is looking at User Experience.  It is probably the best explanation of Systems of Engagement concept that I have heard from SAP till date. What did not happen unfortunately is that SAP could not tie this example to their products and strategy in a coherent way.

Rainer Zinow was articulate as usual on the ByDesign side. I finally understood the thinking behind Financials on Demand. It is good to know it is not exactly carving out financials out of Bydesign. In fact nothing is carved out – just some parts are activated and others kept inactive. And the business case is mostly the ability to do Mergers and divestitures faster, by moving those entities to the cloud solution first.  That is a story I can live with and I see value in it. I did not hear a ByDesign for Large Enterprises story – maybe I missed it, or maybe there is no such thing. In any case, I think ByDesign and B1 ( Richard Duffy is an excellent speaker I might add)  did not get sufficient coverage in this event.  At least there were no surprises.

I don’t recall anything earth shattering in terms of bold new use cases for cloud. May be the intention was to set the foundation with this meeting, and make the big announcements at Teched or SAPPHIRE. Or maybe I missed out the transformational message when it was mentioned. In any case – there were heavy weight cloud experts in the room with me amongst the influencers, and one of them might explain that part better.

Sameer Patel could not present his vision for social and collaboration in the event proper, but he took time at lunch to educate me on that. I am duly impressed – and it is a grown up version of how social and collaboration should work in enterprises, and it puts it in the context of business processes where it belongs.  Sameer gets the prize for the best elevator pitch of the day.

There was a slide shown at the end of the meeting, but put under NDA – which is kind of sad, since that was the best part of the story. Maybe the next time around, they should start with that picture and work back to the technology issues and solutions. I know it sounded cryptic – but I respect SAP’s reason to put an embargo.

Bottom line – SAP should do some serious homework on unifying the theme of their cloud story . Knowing many of the people involved in this, I don’t have the slightest doubt that SAP will get its act together quickly. It is not to please us bloggers that they should do it – if they don’t do this in quick time , there won’t be much attention from their customers who are getting better messages from other vendors. HANA will run fine for SAP for another year with no issues – but without cloud and mobility picking up pace big time, SAP might not live up to big ambitions of its leadership team. And as much as the story is important, SAP needs to find a good candidate from inside the company or outside to say that story clearly to the world.

This was way longer than I expected when I started the rant here, and I am sure I missed a lot of points. But given my day job needs me to to run back to my customers 🙂

 

 

Is There Anything Left To Be Said About SAP HANA – Yeah, There Is


I have written a lot about HANA, and have participated in several podcasts, webinars and so on about HANA. And I am probably the least prolific person around on the topic. SAP and its influencers have all done a lot to spread the word to the extent that I was joking on twitter recently that I wonder if there is anything left to be said about HANA.

I guess there is – about what is going to happen next about HANA.

Apart from the stand alone HANA option and BW on HANA that are both in GA, a lot of things are in the pipeline from what we have heard from SAP – ECC on HANA, CRM on HANA, and every other business application from SAP on HANA, the HANA App cloud and so on. There is also a lot of activity going on about HANA start ups. We know this – but what remains as a question is what will SAP prioritize when it comes to HANA ?

We have heard Vishal Sikka state that ECC running on HANA in some shape will come out in Q4 this year. I know it is a topic close to Vishal’s heart – and for good reason. Having heard Hasso on the topic too multiple times, I know this is a big priority for him as well. I think the primary reason to do this is to prove to the world that HANA can take transactional workloads as well or better than Oracle and other traditional DB vendors. It is a coming of age of sorts for HANA. So this definitely has merit as a worthy goal for SAP to aim at. But is this a good commercial goal for SAP?

HANA apparently has about 600 customers for what is available today as functionality. Not all of them have projects on HANA, but probably will have one at some point. Now, it has only been out for a limited time – so we have to give it time. For a 16000 strong install base, HANA has barely skimmed the surface. Probably it will sell a lot more – and it is a safe bet, since BW is not always a mission critical system, and more customers can be persuaded to buy HANA for BI purposes even though it has only gone into GA recently. There is enough value to offset cost for most BW customers.

However, that is not the story for ECC. Most companies will come to a screeching halt if anything at all goes wrong with ECC implementations. Although to a lesser extent, so is the case with CRM. So I am curious as to how many customers will make the leap into ECC or CRM on HANA in near future. I am sure there are a few that always will buy into SAP’s vision and jump into it. But the vast majority of SAP customers might take a conservative stance on changing their database for a production ECC or CRM instance.

As I and many others have pointed out before – just by porting ECC from some database to HANA, things won’t get incredibly fast by default. The reason is that most of the bottleneck is in the ABAP layer. Unless all that code is rewritten, the schemas simplified and so on – it is difficult to imagine ECC consistently getting a huge boost from Hana. I am sure SAP will probably rewrite some code to make use of HANA, at least for long running batch jobs. But even in that case – the best case I can see is most customers using it as a secondary database for accelerating some parts of ECC at best. Add to this the efforts of all the other DB vendors to attack HANA to protect their turf. So all things considered, running ECC etc on HANA is at best a technical triumph, but not a sure shot commercial success in itself.

Then there is the HANA App cloud. When I first heard about it from Vishal, I was super excited at the potential. But not a lot of action has happened for customers to jump into it. But I am a bit confused on the whole cloud strategy at SAP now. There is the big cloud division under Lars Dalgaard that has BByD, LOB On Demand solutions, SFSF etc. Then they bought Ariba – and I am curious to see where that will fit in. Will Ariba folder under the existing cloud organization? I doubt it – but curious to see is it does. And then there is the Hana App cloud, and netweaver cloud. Where does all that fit? will it stand alone ? Will it fold under Lars’ organization? Why does this matter ? Only because now SAP has so many disparate technologies and data centers, that I am not sure they have the time and effort at their disposal to get synergy out of all of this – in data centers, in applications, and in platforms. Sure we can assume that user experience will converge at some point, but if the back end is heterogeneous, it is hard to drive down costs. I hope I can get some clarity from the SAP people next time I meet them.

Many years ago – SAP made an all out effort , though not quite as impactful as current efforts on HANA , on Netweaver. Netweaver was supposed to be the super platform that would make everything work together seamlessly, and with great performance and low development effort and all that good stuff. As it turns out, it was only a moderate success. Not many people – except some die hard SAP shops – trust netweaver as the platform to run non-SAP stuff. With HANA – SAP has a chance to correct that, and make a big platform play.

Hana as a Platform is where I think SAP has biggest bang for their buck. I also think that is where SAP customers and the developer ecosystem also has the biggest bang for their buck. I am not sure if SAP sees it that way – but surely there are people there who are exploring that. Look at all the start ups, the interest in HANA during techcrunch and so on. These are not the traditional SAP ecosystem people. Their needs are different, and they have no loyalty from past that will keep them tied to SAP . And SAP has a relatively short window to keep their interest and make them loyal.

But there in lies the problem – there is only so much money and time SAP can throw at HANA, despite their deep pockets and excellent commitment at all levels of the company. The needs of HANA as a Platform are not always consistent with the features it needs to be an excellent database for ECC and other business suite products. If SAP tries to do this sequentially by getting HANA ready for business suite first, and then think of Platform plays, they might not have enough of interest from the ecosystem by the time they are ready for pltforms. Of course when I say platform, I don’t mean just the technical features – I mean everything from Go to market, pricing, support – the whole enchilada.

There is a blogger meeting with SAP coming up in few days – I will try to find answers to these while I attend those sessions, and post a part 2 if needed.