Phil Wainewright has provided a first take on John Wookey, SAP executive VP's saas strategy session at SIIA Europe. As Wookey outlined the strategy, I could not help but feel 'about time.' SAP has been dancing around the whole saas/on-demand topic for some time. On the one hand it came to market relatively early with Business ByDesign. Then it put the brakes on, saying little about how other parts of the application portfolio might get the saas treatment. Today, the company has CRM and e-sourcing management along with a slew of on-demand analytics solutions inherited as part of the BusinessObjects acquisition. Tomorrow?
Wookey's vision is based on using acquired technology from Frictionless Commerce to build a multi-tenant infrastructure that ists alongside the Business Suite. This raises interesting development questions. In recent times, SAP has de-emphasized Java in favor of ABAP, its own proprietary language. Frictionless is Java based. He doesn't see this as creating a problem: "This has been presented to the board and the IT council...there hasn't been any issue on this...I think it is important that allows us to build services to which people can integrate to the Suite...that I can eventually make available to partners so they can build additional on-demand services."
While listening to Wookey, I had a feeling of deja vue. It sounded similar to Shai Agassi's fast track development approach from several years back. I wondered whether this might mean product overload: "We're not bringing 70 apps to market - it's unconsumable. We're talking about a handful...some of which might be iterated two or four times a year, others might just be once a year."
Wookey also talked about go to market, offering expense management as an example: "I don't think it should take six months to sell expense management into an existing financials customer. It should be an internet sales demo with one person perhaps showing up with a contract to sign."
As Phil says:
Wookey’s task, of course, is huge. His acknowledgement of the importance of on-demand for SAP’s future success and survival is a welcome boost not only for on-demand advocates within SAP but for everyone in the wider industry, and it appears that Wookey’s team has a great deal of autonomy to pursue its goals: “Effectively we’re like a start-up organisation within SAP,” he said. But at the same time, the strategy is focused on using on-demand as a means of helping customers add extra functionality around their core Business Suite infrastructure, which remains on-premise. On-demand becomes a kind of innovation layer that sits on top of the existing on-premise investment."
We didn't have time to explore the internal conflicts this will inevitably bring in any depth but the impression I got is that Wookey is confident the stand alone unit nature of his group will allow it to thrive. But then we thought that about Business ByDesign. The difference perhaps is that Wookey is trying to work out how to get to volume sales early in the cycle. "We're not there yet but we're working on the model." More important perhaps is Wookey's intention to use agile development that puts code into user's hands every four weeks so that the customer remains engaged in the development process.
We tend to think of SAP as this ponderous company that eventually gets it right but these are very different conditions to those which the enterprise vendor community is familiar. In order to produce a good outcome, SAP has to act differently and Wookey knows it: "It's critical that SAP embraces change."
These are early days and like Phil I am hopeful that Wookey will deliver. He has the pedigree and the internal structure to get the job done. The good news is that Wookey intends to provide quarterly updates. That puts him under pressure but keeps the topic close to top of mind for customers. The bad news is that SAP's recent history suggests it has struggled to move to the saas/on-demand model. Wookey's choice of concentrating on the existing customer base gives him the potential for a head start in making this model work but questions remain. Watch this space for the next episode in this particular enterprise apps drama.
End note: Part of our conversation was recorded on video and this will be made available on my YouTube channel in the next days.