Update from SAP Co-CEOs

Got a quick update today from the new co-CEOs of SAP – Bill McDermott and Jim Hagemann Snabe.

Jim focused on their innovation strategy – making significant steps into on-demand business applications, aiming to support a hybrid approach allowing customers to mix on-demand and on-premise software. In addition they aim to increase support for running the applications on new mobile devices – this, of course, requires a separation of decision-making business logic from front-end logic. Hopefully this will see SAP investing more in its business rules capabilities (described under the SAP tag on the blog). All of this requires that processes and MDM can be orchestrated across this increasingly complex environment, even when non-SAP application components are involved. They are also rolling out more agile development methodologies (like those being described in the new SAP BPM book on which I am working with various other SAP folks).

Lots of interesting questions got asked and here are some of the responses that seem most interesting from a decisioning perspective:

• In memory analytics will change the way high end analytics are deployed. Focused on a variety of partners to bring new approaches, new techniques into high-end analytic space. Still expect to work with SPSS in this regard but also looking for new technologies that take advantage from the ground up of in-memory analytics.
• Business by Design, SAP’s easy to configure on-demand (SaaS) offering, is coming out this summer. Will be interesting to see the extent to which business rules are used to make it configurable.
• Interesting challenge for a company like SAP is that different product lines, different deployment options have a different cycle. On premise software, for instance, cannot be updated too often as customers don’t want to constantly re-install. On-demand software, however, gets updated more often and on-device software is driven by a very dynamic consumer technology market. This is a large scale change, ensuring that different parts of the company can operate on the right timescale while remaining part of the same company. Personally I think that rules-based decision evolution is a key element of this and I hope to see some sign that SAP thinks this way too.
• Asked about mergers and acquisitions – the point was made that Oracle has been much more aggressive – Bill and Jim acknowledged that they are going to be more aggressive going forward while remaining focused on innovation and an integrated, coherent business application suite rather than generating growth through acquisitions. As more and more established customers have been acquired (up to the acquisition of Chordiant by Pegasystems today) this is an interesting topic – increasingly SAP will have no option to grow through acquisitions but this may suit their corporate culture better anyway.
• Asked about the trend (Oracle, IBM) to mix hardware and software they replied that they see a heterogeneous world that is in constant flux – customers never own one vendor’s complete set – so being good at working in this environment is key. Eliminating layers using hardware is good but they see working with multiple partners not owning their own. This requires collaboration with a mix of hardware partners rather than acquiring and integrating their own hardware. Customers don’t want vendor lock-in, they buy a business outcome not a “stack”.
• SAP is not worried about the ownership of Java by Oracle – they see a vibrant, open, multi-company ecosystem around Java and don’t expect Oracle’s ownership to impact this. Interestingly they made the point that programming languages come and go and that Java is not therefore the be-all and end-all.

Interesting conversation, nice degree of openness and responsiveness – much improved over SAP TechEd where avoiding questions was the order of the day.