SAP Aims to be More Cloudy and Mobile in 2012 and Beyond

I attended the annual SAP Influencer Summit (Twitter #SAPSummit), at which executives from SAP meet with analysts and customers from around the world to discuss the company’s direction. Pointing out that in 2012 SAP will reach its 40th anniversary of operations, chief communications officer Hubertus Kulpus and chief marketing officer Jonathan Becher kicked off the summit, then passed the microphones to co-CEO Jim Hagemann-Snabe and CTO Vishal Sikka for overviews of the business and technology strategies. They presented a well-rehearsed dialogue on SAP’s definition of its software business as being in two areas, the “system of record” and “system of engagement”; the first term describes its transactional applications and the second its portfolio of business analytics.

SAP has invested significant resources in expanding from its core of ERP applications. The latest investment is into cloud computing and human capital management with the costly acquisition of SuccessFactors. Its earlier acquisition of Sybase is now showing progress in mobile technology, which I have assessed, and it is progressing also in in-memory computing with SAP HANA, which it launched earlier in 2011 at its SAPPHIRE conference. All of these are important areas for the company’s present and future directions. CTO Vishal used an interesting approach in comparing the company’s technology advancements to events in Greek mythology, but I have to question the effectiveness of describing what SAP is trying to accomplish in the future in terms of the ancient past.

Nevertheless Vishal said SAP aims to help customers advance technologically with no or little disruption to their existing deployments of SAP. It is trying to achieve this by adapting SAP HANA to operate under its current analytic and transactional systems; if that effort succeeds, it could displace what SAP calls 20th century disk-based databases (particularly Oracle’s) with today’s memory-based ones. In addition SAP is integrating other technologies such as cloud and mobile with existing software deployments. Later in the discussion SAP presenters provided statistics and a roadmap of advancing its Sybase-based database technologies ASE and IQ to harmonize with SAP HANA.

Presenters also insisted that SAP is focused on the cloud, devoting the second day of the gathering exclusively to cloud computing and its strategies for the future. This is an important step forward as SAP works to convince influencers and customers that it provides not just applications in the cloud but also a platform and technologies to support them. The company has significant deployments of a variety of applications in the cloud today, and now it’s time to focus on perfecting a cloud platform that can support any type of application. For example, I recently assessed its Sales OnDemand offering, which shows potential if the organization can effectively engage sales organizations with direct marketing and sales. SAP also communicated the steady growth of its SAP Business ByDesign cloud computing application suite that is commonly compared to Oracle Fusion applications but not everyone is looking to rent an entire application suite in the cloud which is why its discrete efforts are so important. I believe that SAP has set expectations unnecessarily high for the role of SuccessFactors in its future cloud computing efforts. SAP definitely is committed to cloud computing, but the question is whether it can fend off major competitors, especially and even Oracle, and the many smaller vendors that use the cloud to deliver applications to specific lines of business (LOB). In addition SAP has not addressed the customer challenges of integrating processes, applications and data that must interoperate whether they are in cloud computing environments from SAP or other providers and in on-premises applications from SAP. We recently found in our business data in the cloud benchmark research that organizations are just beginning to realize their challenges of just renting applications in the cloud with no information strategy or method to automate the interchange of data across them and the enterprise. Over the years SAP handled the challenges of application and data integration inside the enterprise with its SAP EIM and SAP NetWeaver; now it needs to do likewise with its cloud computing efforts. To do this might take acquiring a software vendor or licensing software from providers such as Dell Boomi, IBM, Informatica, iWay Software, Pervasive or SnapLogic to shorten time to market and ensure it can be as dominant in the cloud as it has become inside of enterprises today.

I see simplicity and accessibility of its applications as critical issues for SAP to address so that more organizations can experience its advances, and the company seems to be working on both. On the simplicity side, SAP has been working to improve the usability of its applications and showed the audience examples of new user interfaces for its upcoming releases. Presenters spoke of providing a “consumer-grade user experience” and demonstrated some examples, but I suspect SAP will have to invest plenty in marketing to prove this point. My own experience of what it’s delivering for mobility shows a need for more human factors in the design. I personally have seen improvement in my recent analysis of the new SAP Strategy Management applications available on the Apple iPad and how applications like this on a tablet are the right approach for the next generation of business computing. I found it odd that this application was not mentioned in the event at all as it is clearly a high-value business application. Regarding accessibility, SAP is making more applications available for trial and purchase through its online stores. Currently an Internet search will reveal many online outlets for SAP products, from business analytics to mobility, but none interlink smoothly to the others; I assume SAP is working on its own software superstore.

As for business analytics, SAP president Sanjay Poonen provided an overview that showed it is investing in all key aspects, from its platform and tools for BI and information management that I assessed earlier this year to applications for finance and operations using its EPM and GRC suites. SAP is making a case for an integrated approach to these “systems of engagement.” Its plan for unifying of them with cloud, mobile and to some extent collaborative platforms is more coherent than Oracle’s or IBM’s, although the latter is beginning to understand the importance of bringing its own software divisions together in a direct approach to the market. Now the challenge for SAP is to convince the lines of business of the value of its business analytics as it focuses on evolving its LOB applications to address real departmental needs better than the generic approaches of CRM, ERP and SCM.

At the summit I spent some time evaluating SAP in the LOB areas including marketing, sales and customer services as well as product- and service-centric industries and operational areas. While SAP has offerings of potential value in each of the lines of business, presenters emphasized its cloud and mobility technology advancements for business in general but did not explain the value of its business analytics offerings to the line of business areas. I wonder whether SAP is struggling to develop messages about why its products would be the best for each line of business. However, speakers did discuss the role of new mobile applications for travel and expenses tracking and order and customer information, and provided insight into its customer and human capital management areas. SAP realizes that application buyers now have a business orientation and leadership and responsibility to invest, but it will require more marketing to persuade them that it is not a vendor that requires more IT resources than others which is why cloud and mobile is so important for them.

SAP is leading the market in terms of the quantity of new applications that operate on smartphones and tablets. IBM, Infor, Oracle and others are not as far along, and you can find SAP’s breadth today in application stores including its SAP EcoHub and Apple’s AppStore. But SAP has to balance this with a mobile technology infrastructure to ensure it does not under invest in the unique design requirements of mobile applications such as collaboration and visualization elements to be competitive in the market. It is too early to tell how this will play out, but a point of concern is SAP’s emphasis on HTML5, for which it has been developing an application container in its Sybase Unwired Platform (SUP). It is risky to believe that developing to a lowest common denominator like HTML5 will help popularize applications across mobile platforms like Apple, Android, RIM and even Microsoft, each of which have unique design aspects in their native operating environments. So far my assessment is that the majority of SAP’s mobile applications are oriented more to tasks than to roles or applications. The company has not articulated a vision of how elements like voice interaction can advance mobility; this is already available on the Apple iPhone 4 and Siri, along with Google’s voice technologies. SAP also will have to deal with smaller competitors providing specific LOB applications such Peoplefluent in HCM or Roambi and MicroStrategy in business intelligence; these are accelerating their growth in mobility with advancements in the user experience and interactivity.

SAP has come a long way in the year since its last influencer summit in late 2010, which I assessed. It has been a busy year with advances from its new blend of management tools to new applications. SAP has shifted its priorities to the cloud and mobility at the right time to attract more customer commitment and market acceptance while still being an innovative supplier of enterprise software. While the technology is advancing quickly, SAP’s communications are lagging in explaining why it provides the best user experience and for line of business  and why they can collaborate better; that is at least as important as investing in the cloud and mobile infrastructures. If it can sharpen a more business-centered focus, SAP will remain relevant to business and IT buyers around the world for some time to come.


Mark Smith – CEO & Chief Research Officer

IBM Brings Business Analytics to Apple iPad

Fulfilling its intention to make it easier to access and use analytics and business intelligence, IBM released its Cognos Mobile application natively for the Apple iPad. Of course IBM is not the first to release a native application for the tablet, and many might say that it is late in doing so, but in reality the market for dedicated applications on tablets is just heating up. The adoption rate of the iPad as the tablet of choice for business continues to grow, and while statistics are not yet available our research has found a groundswell of interest this year and last among businesses in mobility for analytics and BI. In this context, the mobile app is significant for IBM Cognos. It has delivered software for mobile technology including smartphones for over a decade, but the new application was carefully designed to establish a foundation for upcoming incremental releases in the tablet format.

After monitoring its progress in development over the last year, I personally downloaded the production release of the application from the Apple AppStore. With a couple of clicks I was up and running on the demonstrations and examples, which is the best way for anyone to get an understanding of what is possible with the application. It provides a folder and library view of analytics that you can select from and open to interact with. Nicely laid out views of analysis can be combined with geographic maps to add context to the information, and you can use charts to update data and charts in the same view. A range of customer, geographic and product analysis is available in the example of a recruitment dashboard for workforce analytics. You can easily connect to your own IBM Cognos server to access content designed in IBM Cognos 10, which my colleague David Menninger assessed.

A somewhat hidden feature of the application I like is the pencil graphic in the upper right;  this “scribble” capability enables you to draw on the screen, highlight any content or write a message that you can email to anyone who should attend to the issues or opportunities you point out. This is one of those simple capabilities that can make an application easy to use; I would have marketed it more strongly to differentiate the application’s approach. In my view, this application is comparable to others in its class that I have assessed, like Roambi, or MicroStrategy, which David recently assessed,although they have been in the market longer and have more interactive and navigation capabilities. The IBM Cognos app is simpler in some ways than those from ActuateQlikView and SAP, but those have more data-driven methods to adjust the analytic views. All of these are better than those like that of Oracle, which does not provide a publicly available demonstration from Apple App Store. Information Builders’ WebFOCUS toGo has some interesting features, but it is a Web application, not a native application, and also is not accessible for general review although I did assess it recently. Microsoft is not competitive in this field, lacking even an application for its own platform and apparently hoping for a miracle to get people to adopt its mobile technologies as I have assessed. For mobile analytics and BI, Microsoft should transition to support the Apple and Android platforms if it hopes to utilize its underlying technology. 

IBM supports other mobile platforms including RIM, which has struggled in recent months with slowing adoption and migration to platforms like Apple, though I have written of its potential. IBM realizes the importance of Android and supports that platform, too and has skipped supporting Microsoft platform.

Overall IBM Cognos has taken a large first step by providing a native application on the iPad, and its cute scribble capabilities complement its overall BI platform and tools. As David Menninger has written, the consumerization of collaborative BI has arrived, and the use of mobility is part of the evolution of business analytics. IBM is smart to support the major Apple, Android and RIM platforms natively. I expect IBM to add more collaborative and interactive capabilities in later releases of the application, which the company has promised to provide more frequently, perhaps even quarterly. If you have not taken a look yet, I think it is worth a couple of clicks from your iPad to see what this major player in business analytics is doing in mobility.


Mark Smith – CEO & Chief Research Officer