We are ERP
Since Fkom 2020 in Las Vegas, USA, SAP has been saying, "We are ERP." An email from an analyst friend reached me in mid-January, pointing me to the latest SAP message from Executive Board member Adaire Fox-Martin.
She reportedly proclaimed at the SAP Fkom in Las Vegas that SAP is primarily an ERP company - but not a word about cloud, about the in-memory computing database Hana, and about C/4 and Qualtrics.
The latter seems logical to me, the CRM story of ex-CEO Bill McDermott has been dead for a long time - strictly speaking: The C/4 idea from Sapphire 2018 could never be brought to life, only the Swiss SAP acquisition Hybris was reborn as "C/4".
And Qualtrics? SAP is keeping the ball very low at the moment: Qualtrics is raiding and robbing SAP's regular customer database and making good sales with these new business contacts.
But the goal and the task were different! The world's most powerful CRM system was to be created from several acquisitions and in-house developments. Even Professor Plattner was quite taken with Bill's idea at Sapphire 2018 in Orlando.
Like so much at SAP from the past few years, it was a wash. Bill McDermott is gone and the dust has settled: C/4 is dead and Qualtrics operates as an exoplanet in the SAP universe.
The "declaration of war" by Adaire Fox-Martin "We are ERP" is therefore the admission "Back to the Roots": Not only C/4 has failed spectacularly, but also the cloud strategy with HEC and HCP and now also Hana 3, the new code version with infinite cloud scaling and "software multitenancy".
Going back to the source may be reasonable in some areas. In a SAP R/3 universe far back in time, data compatibility and module integration were truly exemplary.
The desire of us existing customers to also harmonize, synchronize and integrate the many cloud purchases did not come about on a whim.
Older members of the SAP community have come to appreciate the holistic nature and compatibility of the R/3 modules and now miss this ease of use.
This is ERP, not Hana 3, right? A special case in SAP's current construction site is Hana, the ingenious in-memory computing database that was never designed for cloud computing.
Hana was supposed to bring "real realtime" to SAP's ERP universe, as once outlined by ex-SAP chief technology officer Vishal Sikka. Hana succeeded perfectly in "real time" with many fantastic computer science tricks, but it was an on-prem project from the start. If Hana doesn't scale in the cloud, it's a systemic failure of the Hana code.
SAP has recognized the architecture deficit of Hana: Cloud computing can only be profitable if the application scales infinitely. Setting up a separate Hana instance in the cloud data center for each new existing SAP customer is expensive, illogical and counterproductive - at the beginning of SAP's cloud era, this path was taken, but it is not financially viable.
The success of IBM Power and Hana is based exclusively on on-prem installations. Two years ago, there was already a Hana workshop sponsored by IBM at the Hasso Plattner Institute in Potsdam.
The goal was to show possibilities and ways how outsourcers and cloud providers could realize scalable Hana instances on IBM Power in their data centers. The meeting with prominent participants ended without a result.
SAP has recognized the Hana dilemma and commissioned Hana 3. For more than a year, they have been trying to come up with a new Hana code that should fulfill all the conditions of successful cloud computing.
This year, the Hana Cloud Edition reprogramming and retread is expected to be completed, but the results so far have been disappointing:
When porting "classic" Hana applications to the "new" HCP, dangerous anomalies keep arising. Not good conditions for 2025, but we are emperors!