SAP SE conducted its annual ASUG and Sapphire customer conference this week with the usual fanfare and series of product and strategy announcements. Attendance was announced as over 30,000, not to include virtual attendees tuning-in on the live broadcasts.

There were several overall themes, but a consistent one was that of the continuance of last year’s theme of listening more to customers. In that vein, the enterprise technology provider indicated that individual Solution Roadmaps have been published for all application areas including supply chain management. Two further results from the overall listening effort were SAP Cloud Trust Center and SAP Transformation Navigator.

SAP Cloud Trust Center is described as a public website that offers real-time information on SAP’s Cloud operations and applications, as well as efforts directed at security and privacy of SAP Cloud data. The site is noted as an effort to promote higher transparency standards with customers. Given the latest news of global-wide coordinated cyber-attacks, this effort is obviously timely and should be well received. We encourage other Cloud technology vendors to initiate similar transparency efforts.

SAP Transformation Navigator is a self-service tool to allow SAP customers guidance on the upgrade roadmaps to the new SAP S4-HANA applications suite.  The application provides an inventory of all existing SAP applications and technology, including those directly related to supply chain management, and makes recommendations for likely upgrade paths or on-ramp entry to various SAP S4-HANA applications and technology. As an example, one on-stage keynote showed an example of a likely upgrade of SAP APO supply chain planning applications to SCM elements SAP Integrated Business Planning.

One other area of customer transparency addressed directly by CEO Bill McDermott was that of indirect pricing transparency. Some background, first. In the case of SAP UK Ltd. Vs. Diageo Great Britain, SAP claimed more than £54 million in additional license fees based on API access to its software from a Salesforce application utilizing SAP PI Integrator software. In this case, a judge ruled in favor of SAP and on the right to collect additional license fees based on the wording of the existing contract with Diageo. However, the final amount owed is still to be determined. In his keynote, McDermott pledged that SAP would address and make clearer, its indirect pricing policies. The two areas to be directly addressed for pricing modification were noted as Procure-to-Pay and Order-to-Cash processes supported by SAP. Obviously, this is an area for SAP customers to further monitor.

Two rather significant other product announcements were made at Sapphire, each of which has implications for the SAP extended supply chain management technology community.

The announcement of SAP Cloud Platform offers customers options for a multi-Cloud deployment environment to develop and run applications utilizing their choice of infrastructure providers. Announced providers included SAP itself, Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform— all to be managed in a new SAP Cloud Platform cockpit. That is a far broader deployment option strategy than the prior SAP alone strategy, and an obvious acknowledgement that customers likely demanded broader choice options for deployment. Noticeably missing from the listing was IBM Cloud and Oracle Cloud. Regarding the latter, in the news conference held with the SAP Executive Board, CTO Bernd Leukert indicated emphatically that Oracle will be ignored (For obvious reasons).

Further announced was the expansion of SAP Leonardo, that adds what was noted as machine learning, Internet of Things (IoT), Big Data, analytics and Blockchain capabilities on SAP Cloud Platform. SAP executives painted the picture that Leonardo would eventually become the System of Innovation for customers. In Tuesday’s keynote, SAP founder and Supervisory Board chair Hasso Plattner noted that SAP Leonardo should be viewed not as a “system” but rather a set of powerful tools that will sit inside of SAP applications to bring higher levels of automation and information intelligence.

Before we close this initial 2017 Sapphire blog commentary related to SAP, we want to highlight another observation that was articulated this week. That strategy amounts to a new design approach that moves analytics capabilities to the actual data within SAP’s S4-HANA applications. The premise is a good one- analytics performed directly on the backbone system where data resides. The implication however, is one that SAP communities who have bolder strategies reflecting data lakes or streaming data need to be aware of. SAP can potentially be making such actions more difficult with an ERP-myopic data and analytics approach.

By this analyst’s view, that strategy could cut-off options for all-important extended supply chain data lakes. Obviously, more specifics are needed, and we will strive in the coming days to provide added clarity and perspectives.

We plan to add a further commentary on SAP product direction and implications in the coming days, with emphasis on Hasso Plattner’s remarks at Sapphire.

Stay tuned.


Bob Ferrari

© Copyright 2017. The Ferrari Consulting and Research Group and the Supply Chain Matters® blog. All rights reserved.