SAP's narrative economy

Investment decision: Rise with SAP and Clean Core

For existing SAP customers facing the monumental task of „Rise with SAP“ and „Clean Core“ - i.e. restructuring their entire historically evolved IT architecture - a visionary and comprehensible narrative is not just a marketing luxury, but an existential orientation aid for the future.

In this critical phase, the global ERP market leader SAP from Walldorf seems to have completely forgotten the essential art of storytelling and in-depth educational work. An investigative look behind the scenes reveals that SAP drastically underestimates its own communication and marketing because the company has retreated into an isolated echo chamber driven by the fear of losing control and an almost obsessive focus on the short-term share price.

Instead of engaging in open, critical discourse with the community and independent quality journalism, management takes refuge in controlled invitation-only events and one-way digital communication. SAP CEO Christian Klein acts less as a visionary architect of the future and more as a top administrator who is caught up in an endless „repair service behavior“ and patches up small-scale construction sites.

Cloud, AI, qubits

Following the hype surrounding cloud computing and the rise and fall of the SAP share price, the topic of quantum computing was briefly on the SAP agenda. However, recent reports and personnel changes on the SAP Executive Board have put the focus on AI. But there is no SAP storytelling on AI! What happened to RPT-1? Where are Joule and SAP Business AI positioned? Will the BTP GenAI Hub be expanded or discontinued? Is SAP in control of Agentic AI compliance? Many questions and no answers from SAP CEO Christian Klein.

From SAP's perspective, cloud computing is a done deal, AI is on the rise and quantum computing is the next big challenge. What SAP CEO Christian Klein overlooks, however, are the completely different architectures and challenges of these three IT fields. There is no one-size-fits-all approach to dealing with each of these topics. There is not only a lack of storytelling, but also a lack of respect and understanding for these IT scenarios.

To make matters worse, marketing effectively imploded under Julia White, who has since left the company, leaving the Group without a soul and customers without a strategic compass. SAP is criminally neglecting its own educational mission, as it is simply easier to dazzle financial analysts with cloud growth rates than to laboriously explain the complex business added value of the new IT tools to actual users.

Cloud only, cloud first and AI

The current narrative that Christian Klein presents to the public and existing customers is therefore a confusing cacophony of buzzwords that primarily revolves around the forced march to the cloud. His story oscillates erratically between „cloud only“, „cloud first“ and „hybrid cloud“, but always serves the ultimate goal of transforming valuable on-prem licenses into lucrative cloud subscriptions via programs such as „Rise with SAP“ and „Grow with SAP“.

Christian Klein talks tirelessly about artificial intelligence, green ledgers and technical agility, but fails to provide his customers with a fundamental answer to the „why“, which means that the change is not perceived as an inspiring business transformation, but as a commercial constraint. While the stock market celebrated the narrative of falling costs and rising recurring cloud revenues with all-time highs last year, frustration is growing at the SAP base over a lack of ERP vision, a lack of empathy and the threat of vendor lock-in.

SAP S/4, BTP and BDC

The narrative surrounding the core products S/4 Hana, SAP BTP and SAP BDC reflects this deep conceptual divide. The story of S/4 began ten years ago with the full-bodied promise of „Run Simple“ on the fast in-memory database Hana, but has now mutated into a purely coercive measure driven by the fear of the end of maintenance in 2027 or 2030.

As S/4 is increasingly perceived as a rigid vehicle whose innovative strength is stagnating, SAP has presented the Business Technology Platform (SAP BTP) as the new savior of the clean-core strategy. The BTP story says that all individual modifications and proprietary Abap developments must be banned from the ERP core as „steampunk“ and outsourced to this agile secondary platform in order to guarantee upgradeability.

The latest chapter in this confusing IT construction kit is the Business Data Cloud (SAP BDC), which is intended to resolve the immense data chaos as a saving „data fabric“ and reconcile the SAP world via interfaces with hyperscalers and partners such as Databricks.

Although an official narrative for SAP BTP and SAP BDC exists on paper, it is frighteningly anemic, purely technocratic and completely devoid of business appeal.

Rebranding of Data Hub and Datasphere

SAP's lack of concept in telling these stories was revealed at the presentation of the Business Data Cloud, which was not celebrated as a visionary milestone on a big stage, but was casually dealt with in a mundane livestream, leaving analysts and the trade press stunned. Instead of weaving a captivating story about an open „composable enterprise“ in which BTP and BDC enable customers to orchestrate state-of-the-art AI and data tools with confidence, SAP merely delivered a hasty rebranding of old products such as Data Hub or Datasphere.

If SAP does not rediscover the laws of the narrative economy as quickly as possible and find the courage to develop a genuine, customer-oriented ERP vision, the Group runs the risk of no longer being perceived by its users as a strategic business partner, but rather as an interchangeable infrastructure supplier in an increasingly fragmented platform ecosystem.

Contagious viruses and collective decisions

Professor Robert J. Shiller, winner of the 2013 Nobel Prize in Economics, has shown in his book „Narrative Economy. How stories influence the economy - a revolutionary explanatory approach“, Professor Robert J. Shiller proved that storytelling acts like a contagious virus and influences collective decisions far more than pure facts or mathematical formulas.

WiWo writes: „The prices of individual shares have been experiencing remarkably violent swings for some time now, both upwards and downwards. [...] The reason: the power of narratives. Stories have always had a major influence on the stock markets. Not only the figures have to be right, but also the story. If it is good, fundamentals are of secondary importance.“ (Source: WiWo)

In the foreword to his book „Narrative Economics“, Nobel Prize winner Robert J. Shiller writes: „We must incorporate narrative contagion into economic theory. Otherwise we remain blind to a very real, very tangible mechanism of economic change, as well as to a crucial element of economic forecasting. If we do not understand the epidemics of popular narratives, we have an incomplete grasp of changing reality and economic behavior.“