difficult to tackle SAP.
(Technogies: A Technology Social Network)
The no-news SAP TechEd 2011, Las Vegas show was a success. By which I means SAP didn’t fall prey to pre-announcing yet another ‘innovation’ that won’t be delivered for years to come. Instead, it regaled the assembled throng with HANA…for the third (or is it fourth?) year in a row. In doing so, it kind of confused the audience.
TechEd is supposed to be a technical conference, not another marketing pitch play. Yet some of the geekerati I met were pissed that they didn’t see any tech until the press conference. Which is kind of a waste of time because 95% of the media couldn’t write a line of executable code let alone a line of ABAP if their lives depended upon it. Be that as it may, the technical sessions, and especially those related to HANA, were packed to bursting. Good news - not really. Here’s why:
- I was told there would be new HANA apps at TechEd. SAP claimed 20 whereas the app count is 17 of which only two are in working order. The rest are are beta at best and most of those had been telegraphed beforehand. In other words, nothing really new. Why is that an issue?
- SAP is delivering patch releases to the GA version at a rate of one every two weeks. That’s goodness. But those releases are not solving fundamental problems that exist in HANA’s executed design. They’re applying a constant strip of Band-Aids to a technology that is barely working. Vishal Sikka, executive board member SAP and the person who owns this puppy has to deliver on this. It’s a big ask as HANA is the first real solution of any significance he’s been tasked to deliver.
- Consultants to early adopters have been in stop-start mode for a variety of reasons. Some are connected to problems around the supply of HANA machines. Others are connected to software quality problems. Still others are/were connected to documentation issues.
- The net result is that when early adopter consultants talk about their experience, it is hard for them to report a clear score card. More important, it is even harder for them to talk about live, running examples.
- Bottom line - SAP has done a fabulous job of cranking up the hype machine and stuffing its pipeline - allegedly. But that’s not turning into the welter of use case examples that should be flowing through by now.
It wasn’t all bad news. Despite my negatives above, colleagues came away with excellent outcomes. In our influencer meetings with Sikka and his lieutenants, we got to speak about the practical problems associated with HANA. Sikka promised and delivered immediate action on some topics. Those actions get three major consulting organisations out of a jam, albeit with lingering problems that need resolution.
With TechEd moving to Madrid and mashed up with the more marketing oriented SAPPHIRE Now conference, SAP needs to shut up about HANA and find a different schtick. It can let the marketing run on from TechEd Las Vegas do its stuff. Instead, I’d like to see SAP talk much more about mobile and progress on the Sybase Unwired Platform, both of which got no airplay at TechEd. Given mobile is so hot at the moment, I was shocked. It is something that is easily understood, does not have to be disruptive or require huge consulting resources while offering the potential to proliferate solutions into the larger enterprise workforce and beyond.
It seems that SAP still doesn’t get the fact the market for mobile holds enormous potential way beyond anything HANA will deliver. The main problem comes in the licensing model. I find it staggeringly backward thinking that SAP almost invariably finds it necessary to monetize everything that has running code attached to it. That world has been left behind. If SAP could mobilise itself to think differently to the way it is accustomed it could (almost) easily bulk up without having to find another mega acquisition that inevitably amplifies disruption.
The good news is that SAP now has an articulated AppStore story emerging from its ecosystem executives. I can’t say it is terribly well formed or as attractive as I’d like but at least they have something in the works - with development resource attached. That’s much more than they had six months ago.
Here is something for SAP to think about. I have been listening to a vendor that’s in stealth mode. It will come out in the next few weeks with an interesting take on risk assessment in business planning. They have customers already. The solution almost (but not quite today) fits governance, risk and compliance requirements. They will offer this as a secure, cloud based service and will be more than pleased to let potential customers map their data and trial it at no cost. Even then, the contracted cost will likely work out 50% of an equivalent on-premise solution over a five year period. Plus it will be state of the art, natively running on iPad.
What of broader development issues? Vijay Vijayasankar subtly points in the direction he would like to see. Vijay breaks the execution issue into three pieces arguing for:
- Cross-pollination and learning from people who are good at execution
- Inclusion of the ecosystem in development and testing
- Industrialize innovation
In the detail, he says of innovation generally:
Innovation should matter to the company in some measurable way. Sure it is fun to do gamification innojams, and a couple of apps in HANA a year. That will not add $$ to topline or bottom line. For that – innovation needs to be focused, and the process should be industrialized.
A good example is LOB on demand products. Sales on demand, Career on demand etc are all very good – and have some of the best people at SAP doing their best to make it succeed. But they are too few to make it count. My gut feeling is that each takes couple of years to get to market, and then in another two years or so – they might make $100M or so. I could be wrong – and am glad to stand corrected. But at this scale – how much (and when) will it affect a $15 Billion company’s financials ?
I have a good idea where this is coming from since a number of us have been hashing these issues out the last six months. I’m less worried about the development focus and more concerned about opening up SAP to widescale development opportunities. Despite moaning about this over three years, it still isn’t happening. Just like in mobile, SAP needs to fundamentally rethink and invent a business model that offers real growth and not the fake growth we see coming through maintenance revenue. From what I am seeing, that’s out of reach today. The irony is that in the enterprise market, SAP has the best shot at getting this right.
As you might have gathered, SAP TechEd for me was not really about technology although that played a good part of what was under discussion. Successes were score. Key issues remain.
Once again, the business model dominated conversations. Once again, the same arguments I have espoused for a number of years resurfaced like a bloated corpse. Once again, the reasons I’ve heard before were repeated. I guess you can do that readily when you are protected by a massive maintenance revenue condom reliably ringing the cash register till. (apologies for the mangled metaphors.) It won’t last forever.
[Jon Reed and my show wrap is above]
