Build house

You invest in your own land and build your house for fifteen years. The garden is well-tended, the car is parked in the garage. Over time, you want to hand over the maintenance and administration to a service provider who takes over the land and the house - but not only charges a maintenance fee, but also suddenly demands rent.

Sounds crazy, but it's true. With the Hana Enterprise Cloud (HEC), SAP is trying to sell a very aggressive all-round carefree package, and we have already been approached - it was embarrassing!

The new SAP sales strategy is divided into product groups: There is a sales team for enterprise support, one for on-premise tasks and also for HEC.

It is a disaster, because the young ladies and gentlemen all have a college or university education, but hardly any experience of real life, the SAP community and the needs of existing customers and partners.

In the past, the SAP VB was a consultant and partner, but today he is at best a mouthpiece who knows the current list prices. History, technology, community are foreign to the young VBs.

Thus, of course, the attempt to get us interested in HEC was also unsuccessful - not even a productive conversation about cloud computing in general was possible.

HEC is thus the current pipe-dropper in Walldorf - and I'm not the only one who sees it that way, the opinion at my SAP regulars' table is quite similar.

"Purchased software is as seminal as a VHS tape".

I quoted a London consultant in my column of June this year.

Perhaps purchased software has no future, but those who own licenses should not give them away under any circumstances.

I got the house example mentioned above from a Gartner analyst: Why invest in licenses for years, build up a vested interest with them, and end up "giving it all away" and going back to a rental model?

No, I will certainly no longer voluntarily give away the land and the house that I have earned and maintained. The HEC model has hereby failed - but perhaps not completely pointless.

The aforementioned Gartner analyst recommends two courses of action: first, leverage existing licenses and their maintenance to significantly reduce cloud subscriptions.

This would pay about ten percentage points more than the current SAP maintenance fee and still be orders of magnitude below HEC list prices!

Secondly, before going into the cloud, with or without your own licenses, it is essential to work out an exit strategy. There may be good reasons for cloud computing, but nothing in IT is created for eternity - one day you will want or need to leave the cloud. It is essential to make provisions for this day X!

Unfortunately, our SAP completely ignores this fact and even our dear colleagues at DSAG hardly question and discuss a possible exit scenario.

Gartner offers advice and support, recommending suspending all SAP support and release upgrades, switching to Rimini Street, for example, and waiting to see how Walldorf manages the S/4 Hana consolidation.

What's going on in Walldorf?

It is well known that CEO Gerd Oswald is leaving the company for good this summer. His designated successor since the beginning of the year is the prudent and experienced Michael Kleinemeier.

Here, most things seem to be orderly and settled. The situation in the technical area is completely different: With a lot of luck and at the right time in the right place, the former Oswald pupil Bernd Leukert was not only able to quickly move into the global Managing Board, but also to take over the job of Chief Technology Officer due to the surprising departure of Executive Board member and CTO Vishal Sikka.

But he couldn't get a foothold and establish himself there!

Now danger looms from Steve Singh: He came to SAP through the acquisition of Concur, was able to position himself quickly and has now arrived on the SAP Executive Board, where he is officially responsible for SAP's new growth areas - whatever SAP CEO Bill McDermott wants to understand by that.

At Sapphire this year, it became clear where Singh is headed. He is claiming all of cloud computing, excluding S/4, for himself.

He leads the development, defines the concepts and the markets. However, this reduces Bernd Leukert to on-premise, Hana and S/4, which still generates by far the largest revenue for SAP today, but according to Bill McDermott, the future lies in cloud computing and business networks such as Concur, Ariba, Fieldglass, Hybris, etc. Steve Singh wants Microsoft, Amazon and Google customers for SAP.

At the moment, no innovative topic seems too small, too complex, or too low-yield for SAP.

Only the attributes Hana platform and cloud computing seem to be set irrevocably - everything else is up for discussion. Hopefully not also the old R/3 existing customers, who are still responsible for the Walldorf profits.