German-speaking SAP User Group (DSAG)- Technology Days Hamburg 2024
SAP has potential, but SAP is currently not putting the available horsepower on the road. The user association does not demand or promote SAP, but accepts the sad reality. SAP will not bring an AI vision for DSAG members and existing SAP customers to the streets with single-digit million sums. The direction of SAP's vision may be right, but a billion for Signavio, a billion for LeanIX and another two to three billion for AI is a system error: the billions for Signavio and LeanIX are a successful double whammy, but AI needs a mega whammy. We can already see on the horizon how Aleph Alpha is falling further behind.
Technical developments
At the Technology Days of the German-speaking SAP User Group (DSAG) at the Congress Center in Hamburg, pressing questions about current technical developments were discussed under the motto "Black Box - From Vision to Reality". The hype surrounding generative AI systems is currently attracting the attention of many companies, who are also increasingly looking for suitable areas of application. From DSAG's point of view, integrating AI into existing products to improve their functionality makes sense and can be helpful. However, there is still a world of difference between vision and reality or between sales and usable software.
Large Language Model
While Aleph Alpha CEO Jonas Andrulis raved about the potential of his Large Language Model (LLM) and Signavio's process mining at a Handelsblatt event at the end of last year, SAP Chief Technology Officer Jürgen Müller was unable or unwilling to comment on this challenging combination. Process mining LLM would be a game changer and would reach far beyond ChatGPT in the B2B and ERP world.
Thanks to the quick and easy availability of ChatGPT, the topic of artificial intelligence has gained a lot of momentum since November 2022. However, from DSAG's point of view, it often remains unclear what AI means in terms of specific applications. AI was already being used at SAP long before the hype surrounding generative AI and large language models. If AI is now increasingly integrated into existing processes and data-driven approaches are further developed, this could help to increase the competitiveness, profitability and resilience of companies in the long term. However, this would require an enterprise architecture LLM (LeanIX) and process mining LLM (Signavio) from Aleph Alpha and SAP. Jonas Andrulis already seems to be working towards something similar.
Where is SAP?
Where does a DSAG challenge the ERP world market leader? The announcement of the Generative AI Hub at the last SAP TechEd in Bangalore, India, can therefore be seen as a glimmer of hope. The existing SAP AI Core and SAP AI Launchpad on the Business Technology Platform (SAP BTP) will be expanded to include this Generative AI Hub in order to connect to external LLM models, initially OpenAI to be precise - Aleph Alpha, which would probably be the better choice in conjunction with Signavio and LeanIX, is also missing here.
The introduction of SAP Joule also clearly demonstrates SAP's intended focus on "Business AI". This voice-controlled AI assistant based on generative AI is intended to understand the business context and be directly integrated into the cloud portfolio for business-critical processes of user companies. In his keynote speech at the DSAG Annual Congress 2023, Thomas Saueressig, SAP Board Member for Product Engineering, had already specified this focus on business processes in conjunction with AI. "In principle, we welcome this strategic direction from SAP - especially in light of the dynamic developments surrounding the major models such as OpenAI, Bard etc.," said Saueressig. However, we still have a number of unanswered questions from a commercial, professional and technological perspective," says Sebastian Westphal. For example, transparent and proven billing models and metrics are needed. It must also be possible to prove that valid guidelines have been implemented and documented when AI makes process decisions. From a technological point of view, one important aspect would be how to handle the sensitive company information that is used. The question of indirect use is also still open when SAP data flows into an external LLM.
DSAG Chief Technology Officer Sebastian Westphal discussed with SAP Chief Technology Officer Jürgen Müller at the Technology Days 2024 in Hamburg: There were lots of good ideas - visions!
For SAP Datasphere and the SAP Analytics Cloud (SAC), the DSAG image of the black box is particularly vivid. The product visions fit, but in practice it is not yet possible to map complex, comprehensive end-to-end business applications that companies urgently need. "In addition to the live connection of the SAP Analytics Cloud to all SAP products, this is also needed for non-SAP sources. Appropriate migration scenarios that take existing solutions into account and a license model for occasional users have also been necessary for years," warned Sebastian Westphal, as this is where the topic of indirect use comes into play again.
SAP Business Technology Platform
According to DSAG, users of the Business Technology Platform (SAP BTP) still lack a cross-service strategy and consistency across all BTP services and their interaction. The aim should be to position the BTP even more clearly as a platform in company-wide, multi-level architectures, but also to integrate and position it with the associated business services. The monitoring and logging of the individual BTP services are not yet standardized, and a consistent cloud identity management strategy is not yet a reality. In addition, a uniform access strategy from SAP support to the lines-of-business (LoB) services and a uniform overview of BTP services, including their availability in the price lists, would make life easier for users. In Hamburg, there were also calls for the rapid integration of solutions such as Signavio as a genuine, fully integrated BTP service, which DSAG would certainly promote with its own working groups.
In a publication earlier this year, SAP announced that it would help every existing customer to develop a cloud-first business strategy. In particular, the ERP world market leader wants to meet the needs of users who have already followed SAP's strategy towards S/4 with the Rise with SAP Migration and Modernization programme. This is SAP's response to a request from the German-speaking SAP user group. SAP's announcement last summer that future innovations such as AI will only be made available via the Rise with SAP Premium offering has unsettled many existing customers who have opted for S/4 Private Cloud or S/4 on-prem. However, making the technical integration of AI models dependent on a provider's contractual construct can hardly be mapped in the context of an IT architecture. "Offering AI only in a single cloud contract and operating model is also technically untenable, as large-language models can be implemented independently of this at any time," criticized Sebastian Westphal.
Specifically, SAP will offer a migration and modernization program for Rise that will run until the end of 2024. "According to SAP, this should reduce migration costs by up to 50 percent and significantly shorten the time until concrete added value can be created," said Jens Hungershausen, summarizing the SAP project.
SAP will offer the following to existing S/4 on-prem and ECC customers who sign a Rise contract and move to the private or public cloud: S/4 on-prem customers will receive up to 60 percent of the average annual contract value if they move to the private cloud and will receive up to 100 percent if they move to the public cloud. For existing customers above a threshold value to be determined, SAP will also provide an enterprise architect as part of the Rise contract. This person will advise customers as a trusted advisor without any sales pressure. The costs saved will be deposited with SAP as a credit note. "They can then be used to cover the costs of maintenance, cloud services or additional cloud subscriptions," explained Jens Hungershausen.
