As this rather busy week draws to a close, SAP has concluded yet another annual Sapphire Now and ASUG conference. Supply Chain Matters has provided four separate commentaries direct from the conference and readers can reference each at the following links;

Commentary One

Commentary Two

Commentary Three

Commentary Four

 

In this final posting, we share our summary thoughts and impressions regarding 2011 Sapphire Now.

 

General observations and positive notes:

  • As was last year, SAP obviously invested lots of production support money into Sapphire.  There was video coverage broadcasted live via the Internet, lavish production sets, live bands and talk show formats all expertly designed to present SAP as a world class, enterprise ready company.  That is an obvious positive since on the whole, there really was not a lot of hard news or product announcements generated by the 2011 Sapphire.
  • As in the past, SAP’s blogger relations team (Mike Prosceno, Stacy Fish, Andrea Kaufmann, Craig Cmehil and others) performed admirably in providing each of us unfettered access to SAP executives and customers.  Most all of my requested interview requests were accommodated.  This is a world class team, setting the standard for all other technology providers.
  • More than other years, supply chain messages, topics and implications were threaded in many of the talks, panels and keynotes.  We noted Hasso Plattner’s declaration that he believes that all of SAP’s business planning applications should be the primary target for rewrite on the HANA platform, and his specific mention of SAP APO as the number one priority. Steve Lucas addressed supply chain business intelligence requirements in his overview of SAP Business Analytics strategic direction.
  • While on the subject of HANA, we continue to believe that if successful, conversion of SAP applications and software infrastructure to take maximum advantage of in-memory technology is game changing.  With this year’s Sapphire came a more detailed understanding of extensive and far-reaching this objective really is, as well as the difficult technical challenges that remain for SAP.  That for us is the real takeaway from 2011 Sapphire, what is going on behind the scenes. While SAP often declares itself as an innovative company, the true test of that statement really occurs in the coming months and years.
  • Where 2010 was a focus on business reporting business intelligence, 2011-2012 has been characterized with a focus on operational focused business intelligence.  We trust that SAP will follow-through on that objective.
  • The few supply chain related presentations seemed well attended indicating heightened interest by SAP customers.
  • This year’s Sapphire included a novel micro-discussion format which we tended to like.  Attendees who are interested in the featured topic can attend, and the designated SAP facilitator can not use any PowerPoint or canned presentation.  The facilitator has to know his subject matter and be able to interact with attendees in responding to their questions.  These sessions were planned to accommodate 10-15 attendees, but those in the supply chain area were largely swamped. In one session, a hand count noted over 90 attendees.  We observed a session focused on the new RDS in SAP Procurement having a similar headcount, where two facilitators had their hands full.  The concept of a focus group discussion is great but perhaps the planning and execution will be improved for future Sapphires.
  • It was good to note that the SAP SRM applications area has been granted a strategic priority by SAP senior management.  It seems that SAP will no longer tolerate penetration from various other best-of-breed providers in this space.  Expect more aggressive product initiatives as well as a potential acquisition in this area.

 

In the needs work or concern category:

  • The technology gaps among where existing SAP customers are in their systems landscape and where SAP is headed is widening even more, and customers face difficult decisions as to strategic direction and budgets.  Keeping current with SAP NetWeaver, Business Objects and other technologies could be an expensive proposition and as noted, SAP has now put on-demand HANA on the table for long-term consideration. Now, more than ever, supply chain functional and IT teams within SAP shops need to insure close communication and collaboration with the office of the CIO.
  • As noted, SAP’s move toward HANA has far-reaching implications particularly in the areas of supply chain planning, execution, response and business intelligence.  The big open question remains the overall timetable, which is, of course, multi-year in nature.  Also announced was SAP’s intention to move HANA to the cloud which has all forms of implications related to data security, response time, and the long-term presence of Business Warehouse (BW). SAP management acknowledges that more concise communication and timetable roadmaps are required to assist customers in their technology and applications upgrade timetables, and we trust that this area will be on particular focus for the remainder of 2011.
  • We were disappointed in the continued lack of clarity regarding SAP’s efforts to develop an sales and operations planning (S&OP) support application that leverages HANA capabilities. In the interim, SAP customers are left with an existing sub-standard S&OP support application that requires far too many dependencies on other applications to manage an overall process.
  • We remain concerned relative to ongoing synergies among SAP SCM, PLM, Manufacturing  and SRM solution development teams.  After being previously unified, SAP SRM is once again independent with its own set of priorities and strategic deliverables.
  • We were somewhat disappointed in customer adoption numbers of SAP Business by Design, SAP’s thrust to support small and mid-market company needs. Accumulating just 500 customers to date, we would have anticipated that this application suite would have far more numbers of adoption.  This is another obvious area of emphasis for SAP in the coming months.

 

During their keynote presentation, SAP Co-CEO’s Bill McDermott and Jim Hagemann Snabe stressed that SAP continues with the belief that customers have the right to have trusted partners, and that SAP must constantly earn its seat at the table.  In the past, SAP had sometimes embarked on initiatives that were better for SAP’s bottom line. With the declared objective of in-memory computing and HANA, SAP is embarking on a massive objective with far reaching implications.  The open question remains whether customers and supply chains will discover compelling value in these efforts.

Bob Ferrari