SAP’s strategy: All cloud, all mobile and all in memory

ORLANDO — SAP AG announced Tuesday it is launching an “accelerated” cloud strategy spearheaded by SuccessFactors, a cloud provider it acquired this past February.

SAP said it will integrate its ERP, CRM, financial and HR software closely with SuccessFactors’ BizX Suite.  It also announced the upcoming availability of SAP NetWeaver Cloud, which is intended to be the company’s main platform-as-a-service offerin,g and which SAP co-CEO Bill McDermott described as a way for businesses to move into the cloud “with a very light footprint.”

SAP, best known for its ERP and CRM software, is now investing heavily in cloud, mobile and in-memory data analytics technology (particularly via its in-memory HANA platform). Indeed, Jim Hagemann Snabe, co-CEO of the company, predicted that in less than five years, all computing worldwide would be mobile, in-memory and available in the cloud.

He drew a distinction between SAP’s efforts to create cloud-only applications and those of its competitors, such as Oracle Corp., which create applications that can run in either on-premise or cloud environments. “It’s a fundamental mistake that what was designed for on-premise can just be moved to the cloud,” he said.

Some of these applications, he added, by virtue of having been created several years ago, “cannot have been created with the cloud in mind.”

Lars Dalgaard, CEO of SuccessFactors, said that while cloud environments will never totally replace brick-and-mortar data centres, they are clearly going to dominate the future.”(On-premise) is going to be around forever,” he said. “There’s just going to be a lot of cloud to complement it.”

Stefan Ried, principal analyst at Forrester Research Inc., said that the recent announcements show that SAP is “really getting serious about the applications in the cloud, which is a a bold move, because previously, they were just looking at specific needs like [those of] … small and medium enterprises.” He said the acquisition of SuccessFactors was like “renovating the whole company” and demonstrated that SAP had recognized the widely different conditions under which enterprises set up cloud environments, whether private, public or hybrid.

With regard to SAP’s predictions of an all-cloud future, he said there was “big difference” between having computing resources available in the cloud and customers actually using them.

“In many cases you have components that you could source out of the cloud but it depends on if it… make[s] sense for the specific case. I believe in that respect it’s very likely that you have in five years every, or most, of the business logic that SAP is selling today on-premise in a cloud version, but’s it’s not likely that every customer will use all of those.”

Ried said what is likely is that “commoditized, standardized business processes” will be moved over to cloud environments, while enterprises will keep the highly individual components of their business closer to home for the time being.

In line with its recent predictions, SAP is positioning HANA as the powerhouse behind its cloud strategy, banking on the fact that high-speed analytics will play an increasingly big role in business decisions in the coming years. The company says it hopes to become the world’s second largest database vendor in the near future.

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Jim Love, Chief Content Officer, IT World Canada

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