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At this year’s SAPPHIRE NOW conference (Twitter: #SAPPHIRENOW) SAP demonstrated its in-memory computing technology and applications. SAP’s High Performance Analytic Application (HANA), which I think of as a high-availability network appliance, is part of the technology industry movement to increase the performance and scalability across a range of applications, from analytics to transactions, to drive timely insights on data or real-time interactions across a business value chain that includes everyone from customers to suppliers. As part of the in-memory computing initiative, SAP demonstrated its in-memory database, which uses a columnar data store that employs technology SAP acquired with the Sybase IQ product. As I noted before the conference, in-memory technology is part of a major new focus for this global business applications company.

In a technology keynote, SAP CTO Dr. Vishal Sikka let the customers do the talking. More than a couple of dozen testimonials came from the likes of CIOs at Caterpillar, Colgate-Palmolive, Nestle, P&G and other global companies, all of whom said they have been implementing HANA not just to run faster and more cost-effectively but also to enable new levels of efficiency in business processes.

To make the case that you do not need a dedicated appliance like the hardware HP, IBM and Oracle sell, SAP cofounder Dr. Hasso Plattner demonstrated that HANA can operate on platforms as small as an Apple server or as scalable as a Dell PowerEdge R910 rack server. The company highlighted its partnership with Dell to further its message of interoperability.

 SAP demonstrated many applications it has built on top of HANA, including strategic workforce planning, a dynamic cash flow management for supporting financial operations for managing cash and accounting operations across AR and AP, and a new available-to-promise (ATP) order-inquiry application that had many attentively watching. In addition, SAP showed a range of modeling and calculation operations that can be computed on the platform and that could be part of any planning process. It is building a new advanced planning optimization (APO) system for companies that have struggled with limitations of the existing SAP APO. Many of these applications were presented through Microsoft Excel to demonstrate the power of SAP HANA, though eventually they will be more formalized, like the applications SAP offers under its the business analytics umbrella for lines of business and vertical industries. SAP partners offered demonstrations, too, among them Centrica, showing smart-meter analytics, and Medidata, using HANA in a cloud edition for supporting clinical trials and analytics against patient and outcome data.

SAP NetWeaver BW will add support for SAP HANA in the fall with the NetWeaver service pack 7.5 and the SAP HANA service pack 3. HANA will be able to replace the existing database with in-memory computing, which will not just speed up performance but also reduce the cost of database maintenance and support. This new combination should dramatically increase the throughput of BI tools using SAP BW and help further the adoption of the recently released SAP Business Intelligence version 4 that my colleague assessed.

SAP is clearly in the big-data market, where a lot is going on now. A main focus has been on the open source application Hadoop. Commercialization of Hadoop by providers such as EMC and Cloudera illustrates that we are living in the era of large-scale data. IBM is focusing on the unification of Hadoop and large sets of data and shifting away from its acquired Netezza and IBM DB2. Meanwhile, Teradata is expanding its processing power with in-memory computing using solid state disk and the acquired Aster Data to help reach data across multiple platforms. Oracle is advancing its Exadata appliances using Sun hardware and storage with Oracle database technologies as part of its playbook. Part of the vision of HP’s new CEO, ex-SAP CEO Leo Apotheker, includes analytic database technology from newly acquired Vertica, but HP’s technology is yet to be proven to be scalable and ready to compete in this market though the company is promoting like it did with its predecessor product called HP Neoview. So this is a very busy market of technologies to address the need for faster computing of data to support business.

In order to compete successfully in this developing market, SAP must continue to focus on the business applications aspect of big data and in-memory computing. The company has been committing on-site resources for its customers to demonstrate HANA’s capabilities. SAP HANA will extend its Enterprise Information Management products to advance what’s possible in management of data across analytical processing and operational execution. SAP made it clear that HANA and the future integration with SAP NetWeaver BW are part of its new generation of applications and that the company is eager for competitive bake-offs on its reliability and scalability. SAP HANA is definitely something to examine if you are looking to gain significant throughput of your data and analytics for business for which our benchmark research finds to be in high demand by organizations across the globe. Let the games begin.

Regards,

Mark Smith – CEO & Chief Research Officer

At SAP’s annual SAPPHIRE NOW conference (Twitter: #SAPPHIRENOW) this month, the company introduced a new portfolio of human capital management applications that will be available on many devices and added mobility options for users, including offerings for smartphones and tablets and cloud computing. This move beyond the traditional on-premises approach of SAP’s ERP Human Capital Management product suite is a critical step forward for SAP if it is to remain relevant for HR organizations.

SAP’s established HCM applications cover the basics of talent management including recruiting, performance, succession, learning, planning and analytics and employee and manager self-service, along with core HRMS features of payroll, benefits, time and attendance, scheduling and deployment. While the suite is robust, so are the costs and resources necessary for businesses to install, upgrade and maintain the on-premises applications. This burden has influenced HR departments in the last five years to shift their focus and investment to applications that can be rented and readily deployed across organizations.

Quick access to on-demand talent management applications has fueled the growth of companies such as Peopleclick Authoria, Plateau, Saba, SuccessFactors, SumTotal, Taleo and Workday. Many of these talent management software providers have grown due to their focus on a couple of key applications including performance management and compensation management that have been in demand for access and use in business which we have confirmed through benchmark research.

SAP still has a significant base in global and domestic HR organizations due to its long presence in the HRMS market and support of languages and currencies around the world. The company provides upgrades to SAP Business Suite 7 for HR with enhancement packages and the SAP Rapid Deployment Solution (RDS) approach to application deployment.

SAP also works closely with software partners to round out its offering to meet the growing demand to manage human capital across the entire workforce. For example, SAP has worked closely with Nakisa for many years to provide visualization software like the applications available from Human Concepts and Aquire. (Aquire was recently acquired by Peopleclick Authoria.) SAP should explore additional ways of looking for talent across social networks such as Facebook, LinkedIn and online job boards to streamline the recruiting and hiring processes, as SAP partner Talent Technology has done with Talemetry.

At SAPPHIRE NOW SAP executives discussed and demonstrated new directions for their human capital management applications. Career On-Demand will build performance, development and analytics around employee activities and evaluate what employees can do to advance their careers. To compete better SAP has redesigned the application’s user experience to be more efficient. In addition, as seen in the new Sales On-Demand application that I recently analyzed, SAP has a new approach to business collaboration and social networking across the enterprise. This will probably take shape within SAP’s human capital management software as it has in sales since the existing collaborative manager and employee dialogue could use improvement.

The conference also saw new developments and customer validation with SAP’s high-availability network appliance (HANA), which provides in-memory computing for analytics and transactions. HANA is the foundation for a new suite of applications that can process large volumes of data for a range of business analytics and planning needs. A new HANA-based application for strategic workforce planning can handle large volumes of employee hiring, promotion and termination data to predict the three- and five-year makeup of the workforce. This next generation of human capital management is more sophisticated than regular workforce planning for looking at headcount, salary and succession planning. We recently completed a business analytics benchmark that researched the needs for workforce analytics and found the majority of organizations still using spreadsheets. Instead of this ineffective practice, HR organizations should employ a workforce analytics foundation that can integrate data to develop key people metrics and indicators.

SAP has outlined an aggressive roadmap for its HR line of business, with a quarterly release of new software in on-premises, on-demand and mobile platforms such as the Apple iPad. It faces competition from global providers of HRMS and Talent Management such as Oracle, with its Fusion HCM application suite, and Infor, whose acquisition of Lawson is not to be underestimated. In addition, many talent management products, such as SumTotal Systems and Workday, come with an underlying HRMS for managing the employee record, which is sometimes required to retrofit the entire set of human capital management processes.

I see 2011 as a critical year for SAP to keep its relevance to HR. It must expand its footprint of applications to meet the next generation of needs in human capital research management. It looks like SAP will be busy with plans for a portfolio of new applications and advancements. HR professionals who are using SAP ERP and HR applications should examine these plans and balance them against today’s human capital management needs.

Regards,

Mark Smith – CEO & Chief Research Officer

Mark Smith – Twitter

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