C-Level Competence Is Key

With an open hybrid cloud strategy and platform as a foundation, SAP users can succeed in their balancing act. Moreover, non-SAP and SAP applications and processes can be considered equal and can be methodically integrated together in a uniform manner. This also offers maximum independence and flexibility, where CIOs can regain a sense of freedom through this strategic approach.

Many companies today are facing similar challenges: digital transformation, increasing competitiveness, cost optimization, the shortage of skilled workers, and/or new regulatory requirements. The latest regulations, in particular, demand a high degree of flexibility within the IT infrastructure to ensure swift implementation of both current and forthcoming requirements. Examples of this are DORA, the supply chain act, the digital product passport or upcoming sustainability, governance, and compliance guidelines.

To strengthen their future viability, companies must first and foremost also address new topics such as AI and ML, data analytics, Big Data or IoT. AI and ML are particularly gaining increasing relevance across industries, including among SAP users, due to the hype surrounding large language model (LLM) services. Machine Learning (ML) can be used efficiently in a wide variety of SAP areas, such as master data analysis optimization of production processes, supply chains and quality control. Many companies are currently developing and training models with SAP data, which they then run in production environments.

The scope of tasks encompasses all facets of corporate IT, implying that SAP users will inevitably find themselves compelled to advance their modernization initiatives. The overarching objectives are centered around simplicity, agility, productivity, and innovation, all of which the new SAP landscape must align with, while adhering to the principles of "keep the core clean" and "side-by-side extensibility" in the SAP approach.

A company can only optimally master the diverse challenges with a holistic view and an end-to-end IT strategy. Silo-like IT landscapes are not conducive to achieving this goal. From an SAP perspective, innovation topics are closely linked primarily to Rise with SAP and the SAP BTP (Business Technology Platform). This fulfills many, but not all, of a CIO's wishes and needs. When selecting a target platform, they will want to gain independence and freedom, yet also retain strategic control for the best possible implementation of future innovation topics. Above all, they will also want to ensure a high level of agility in corporate IT. This will only be possible if the SAP landscape does not run in isolation, but rather is embedded in an integrated process landscape, and not just through interfaces, but via operating models, automation, and end-to-end development models.

Often a CIO’s overriding goal is transforming the often siloed SAP landscape into an integrated corporate IT as part of an innovation strategy. For many companies, key components of success in this stage are open source-based hybrid cloud environments, which are based on enterprise Kubernetes platforms such as Red Hat OpenShift and which have been well-established for several years. 

Through the adoption of an agnostic hybrid cloud approach, enterprises attain strategic flexibility. This approach enables any innovation or concept to be deployed and scaled in any environment without the need to adapt its technical foundation, all in line with the core principle of "develop once—deploy anywhere." Applications can seamlessly choose to operate in on-premises environments, at the edge, within private clouds, or across hyperscaler infrastructures. SAP is no longer excluded, as an open platform now supports the SAP concept of "side-by-side extensions," empowering companies to implement end-to-end processes in an agile manner. This integration capability also facilitates the seamless integration of the SAP landscape with non-SAP systems. For instance, Red Hat OpenShift serves as an ideal foundation for the development and deployment of AI solutions in the context of SAP data sources.

An open hybrid cloud environment additionally supports—or rather links—the two different innovation approaches for SAP via modern APIs and development environments. That is, outside-SAP-in and SAP-inside-out, i.e. a business-led view from both the non-SAP and SAP worlds. Both worlds refine each other constantly and with agility which has not been conceivable through traditional approaches. The user can decide, for example, to go the Rise route with SAP and use BTP. This approach offers clear advantages, as the BTP features numerous pre-integrated extensions tailored for SAP processes. These extensions can now be expanded to encompass all target environments, with an open hybrid cloud serving as the underlying framework. Consequently, an open platform serves as the foundation for an "outside-SAP-in" approach, facilitating the connection of any modern cloud-native, edge, or factory applications to SAP.

Nonetheless, a single platform is insufficient to tackle all the challenges posed by various environments, be it on-premises, at the edge, in a hybrid multi-cloud setup, or in the context of non-SAP systems. The primary overarching objective during the modernization phase is to enhance the application development strategy with agile SAP integration. Furthermore, as part of the modernization process, SAP users receive comprehensive support from the expanding ecosystem of open source-based SAP tools, encompassing cultural, methodological, and technological aspects.