SAP CEO McDermott: 'Suite always wins' in cloud too

"We're not going to be about spare parts. We will lead with the cloud. We're bringing it with everything we have," said SAP CEO Bill McDermott.

NEW YORK--SAP CEO Bill McDermott laid out a strategy that revolves around cloud delivery, an integrated suite, a common customer support team and


McDermott's positioning for SAP is to corner Salesforce and Workday as commodity plays and redefine the company's pitch toward integrated cloud stacks, industries and business returns. McDermott noted salesforce automation is a commodity everyone has. Ditto for many HR features. SAP's real win will be transitioning customers to the cloud---powered by its HANA platform---and delivering business outcomes.

"We're going to assert our will and let people know what the other ones don't have," said McDermott. "The future of the cloud is the integrated enterprise. In the end, the suite always wins. Always has. Always will."

Also SAP's master plan: A look at the challenges ahead

McDermott, who fleshed out comments made on SAP's recent earnings call, was a headliner for a bevy of presentations that should reveal the product roadmap, line of business applications and cloud pricing. As you would expect with a master salesman like McDermott in charge, SAP has its messaging and core narrative down well. 

If SAP can outline clear pricing and subscriptions for its software it will have a big advantage. For many large enterprise software, cloud pricing isn't transparent, wrapped in with license deals and hard to find with just a few clicks. Simply put, enterprise software companies don't want to surface cloud pricing the way Amazon Web Services or Rackspace do. 



The suite bet for SAP is a well known play. That play built the company's success. What's unclear is whether that strategy will work in the cloud where it's easier to integrate best-of-breed players.

SAP's big challenge will be navigating from a license model to one based on subscription while growing its core on-premise business at a slower rate. "The on-premise model is still a growth model, but it's slower for customers to consume innovation," said McDermott. SAP's plan is to integrate its own products seamlessly and then the enterprise.

"We're not going to be about spare parts," said McDermott, who didn't mention names but appeared to be referring to Oracle. "We will lead with the cloud and we're happy to sell it as a subscription...We're bringing it with everything we have."