This week is turning out to be a noteworthy week for enterprise software technology.
Two major enterprise software providers, SAP, and Oracle are now fixated on helping to accelerate existing licensed software customers to migrate to more advanced and flexible Cloud-based software suites. The timing of messaging is beyond accidental, strategies and approaches are different, and the battle lines are growing more pronounced.
In the first of a two-part series, Supply Chain Matters contrasts each approach with initial takeaways for readers.
SAP Sapphire NOW
Let us begin with SAP which is conducting is annual Sapphire NOW customer conference in Orlando this week. Yet again, the global-based enterprise software provider has utilized this event to recast another transitional product roadmap for customers. SAP
The opening keynote anchored by SAP CEO Bill McDermott began with a listing of described demands from SAP customers:

  • Singular views of all data and processes related to customers because their end-customers are demanding such capabilities.
  • That their data be safely protected, and that data related to end-customers adheres to new regulatory guidelines such as GDPR in Europe.
  • That data and enhanced business intelligence is the new currency in the digitally-enabled world, and more timely support is needed to move toward this capability.
  • That they seek a harmonized experience and greater value from SAP. They further seek a less-disruptive and less-costly path to digital transformation.
  • That they are frustrated as being treated as sales opportunities.

The keynote then unveiled SAP’s notion of The Intelligent Enterprise which is to be supported by the SAP Cloud Digital Platform, best described as a more streamlined suite of Cloud-based application suites.
They consist of:

  • A newly announced SAP C/4 HANA suite focused on moving beyond CRM to integrate all customer-facing processes and decision-making to support sales, marketing, commerce, and customer-service. The suite is being designed to bring together the previous acquisitions of Hybris, Gigya and
  • SAP S/4 HANA- which serves as SAP’s Cloud-based ERP suite
  • SAP Ariba – which has now assumed both B2B Business Network as well as direct and indirect sourcing and procurement process support.
  • SAP SuccessFactors– which serves as SAP’s human capital management (HCM) support platform.
  • SAPConcur– which serves as SAP’s travel management support platform for customers.
  • SAPFieldglass– which serves as SAP’s contingent, independent contractor, and flexible workforce support platform for customers.

In the center of these Cloud of Clouds is SAP Digital Cloud Platform, supported by the newly announced this week, SAP HANA Data Management Platform, along with a new SAP Data Hub that is described as managing streaming data flows across the various suites, data lakes, third-party non-SAP applications including other ERP vendor platforms.
Other announcements made this week include SAP Conversational AI, SAP Leonardo Machine Learning Foundation, SAP Cloud Platform Blockchain, and others.
If all of the above seems confusing for readers, it was likely confusing for most of the Sapphire audience as-well. A new multi-year product roadmap is unfolding, and customers are once again, being asked to trust that SAP understands the needs for a more seamless route to digital transformation.
Analyst briefing sessions pointed to other problem areas related to rather large customers, the fact that they have customized their existing ECC on-premise applications to the extent migration to Cloud is a difficult, disruptive and expensive challenge. SAP executives indicate they are working very hard on coming-up with more attractive paths, supported by advanced technology.
Three Potentially Positive Developments for SAP Customers
From our Supply Chain Matters lens, there were three important positive developments that SAP enterprise and supply chain management customers should focus on.
The first was this week’s announcement of Cloud Platform Enterprise Agreement– described as a single contract to authorize use of any Cloud-based applications based on “consumption-based pricing”. The analogy is described as a single contract, pre-paid credit card allowing access to all Cloud applications without having to endure multiple negotiation engagements with an SAP sales representative. That stated, be diligent to the implications of consumption-based pricing, especially for mission critical applications such as customer fulfillment, planning, logistics and transportation which are driven by business volume.
The second is a discernable shift in SAP’s data management strategy to what is being billed as Master Data as a Service supported by the new SAP HANA Data Management suite. SAP is promising to remove the pain of constant data cleansing and updating by leveraging machine-learning technology. There is now a more discernable architectural shift toward allowing data and information to flow beyond individual applications through a data streaming approach. All of this is solid direction, but the question remains overall timing.
The final positive relates to the global network infrastructure vendor choices supporting the SAP Digital Cloud.  In addition to SAP itself, and previously announced Amazon AWS hosting, announcements were made this week for general availability support of SAP Cloud Platform on Microsoft Azure and Google Cloud platforms. An added announcement was intent to provide support on IBM Cloud as a private deployment. Each can provide SAP customers added choices as to geographic support, response, and data security needs. It further removes the barrier of SAP having to be the sole infrastructure platform supplier, which adds to added SAP capital investment that can hold-back deployments.
Initial Summary Takeaways
It will obviously take additional time for customers to have to once again sort-out and evaluate a revised SAP product roadmap and migration options. The analogy is when you thought you saw this movie before, but it now has a different ending.
The big winner for this week’s announcements are clearly the SAP ecosystem of partners, who once again are afforded the opportunity to assist customers in trying to understand and deal with SAP’s ever-changing roadmaps.  Another opportunity is SAP’s intent to turn-over the challenge of complex migration of highly-customized ECC instances to select systems integrators. As CEO Bill McDermott exclaimed in his keynote wrap-up regarding partners, they will either join us as before, or regret they did not.
Supply Chain Matters will provide added SAP Sapphire Now commentary, as well as some added insights related to SAP’s strategies and direction in supply chain management support in subsequent follow-on commentary.
Bob Ferrari
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