SAP Is Floundering in the Cloud

Native, first, and singular

The success of many cloud providers lies not in their choice of operating model (cloud computing), but in the fact that they offer only one version of cloud software, providing immediate added value for all users. A good example is Workday's people management software. All users work with the same release, the same version, which means any improvements to said version directly benefit all users. Evaluations such as employee turnover and what can be done about it can always be carried out on the anonymized total workforce.

As long as SAP does not manage to lead customers to a uniform software release, any discussion about the operating model is also invalid. Added value for the community of SAP customers can only result from a singular software architecture. Whether these ERP systems are then connected via cloud, or are themselves already in the cloud, is completely secondary.

Monitoring and CCC/CCoE

The DSAG is the German equivalent of the ASUG; the abbreviation stands for the German-speaking SAP user group. In his keynote address, DSAG board member Thomas Henzler got to the heart of the problem in SAP's cloud theme: he expects a cloud system to run smoothly for the end user, and not for it to be another piece of software that has to be monitored through cloud ALM and other tools. Why go into the cloud if the user has the same effort as with an on-prem system?

Based on SAP's current understanding of the cloud, however, a cloud ALM is indispensable as the successor to SolMan. However, this results in another requirement from Thomas Henzler: a Customer Competence Center (CCC or CCoE) is just as necessary for a cloud operation as it was obligatory for on-prem installations. Cloud computing also requires an SAP Basis team. Note: in 2024, E3 Publishing will once again be holding the CC Summit in Salzburg with all topics relating to SAP Basis for on-prem and cloud.

Composable ERP

Anyone who discusses cloud computing cannot avoid the topic of platforms, meaning the Business Technology Platform (SAP BTP) was the focus of many discussions at the DSAG annual congress, as well as the possibilities that such a platform establishes: namely, composable ERP. Visitors found the buzzword BTP at many a partner booth. The offers ranged from security, authorization concepts, and compliance on the BTP to applications such as electronic invoice receipt as a BTP app.

Some SAP customers have already recognized the possibilities and opportunities of BTP and have become more active in utilizing it. In the early phase of BTP evaluation, however, just as many users still require guidance. On February 28 and 29, 2024 in Heidelberg, E3 Publishing will be hosting a Steampunk and BTP Summit.

A composable ERP on a BTP is certainly still a long way off. However, a discussion about an S/4 successor should be taking place now. This would also help to refocus the ERP discussion on business processes and free it from operational issues such as licenses and operating models.