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Cloud Solutions: Hybrid and user centric solutions come off as winner (CeBit 2013 Bert Schulze)

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70% of CIOs will embrace a “cloud first” strategy in 2016 …

70% of CIOs will embrace a “cloud first” strategy in 2016
Prediction
  Today, only 23% of enterprises have a “cloud first” strategy on all new IT purchases
  As CIOs establish cloud architecture standards, update service mgmt processes for cloud and develop a cloud migration path, this will grow
  Experience in cloud initiatives will address the current “skills gap” identified by many CIOs
  PaaS solutions will be the Next Gen platform for CIOs
  IaaS will radically drive down costs for early adopters

75% of all IT spendinds will go into cloud or hybrid systems by 2016. This strongly indicates the market in on the move…

And what is SAP doing?

The cloud happens now and SAP is already among the biggest cloud players in the market @ Time of CeBiT 2013:
$1B cloud run rate (We reached, calculated based on Q3 billings a revenue run rate of $1B, which is already 40% of our way towards a €2B business in 2015 in the cloud)
20m+ paying business user in the SAP business cloud (this is by far the largest number of paying business user in the cloud which makes us #1 cloud player in this categorie)
6000+ customers
5000+ people in the company work in the context of cloud

This should give an idea that
1) Cloud is there today
2) SAP takes it serious. This is not a hype, this is a strategic piece of our business
3) We are prepared for scale in the large Enterprise segment

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  • 70% of CIOs will embrace a “cloud first” strategy in 2016 Prediction   Today, only 23% of enterprises have a “cloud first” strategy on all new IT purchases   As CIOs establish cloud architecture standards, update service mgmt processes for cloud and develop a cloud migration path, this will grow   Experience in cloud initiatives will address the current “skills gap” identified by many CIOs   PaaS solutions will be the Next Gen platform for CIOs   IaaS will radically drive down costs for early adopters 75% of all IT spendinds will go into cloud or hybrid systems by 2016. This strongly indicates the market in on the move…And what is SAP doing?The cloud happens now and SAP is already among the biggest cloud players in the market.$1B cloud run rate (We reached, calculated based on Q3 billings a revenue run rate of $1B, which is already 40% of our way towards a €2B business in 2015 in the cloud)20m+ paying business user in the SAP business cloud (this is by far the largest number of paying business user in the cloud which makes us #1 cloud player in this categorie)6000+ customers5000+ people in the company work in the context of cloudThis should give an idea that 1) Cloud is there today 2) SAP takes it serious. This is not a hype, this is a strategic piece of our business 3) We are prepared for scale in the large Enterprise segment
  • One of the most disruptive technology trends to emerge over the last few years is the “Consumerization of Enterprise”. We define the Consumerization of Enterprise as the large and growing trend of individual employees and departments adopting technology and software on their own volition, as consumers, without prior corporate vendor selection or top-down authorization. This form of technology adoption has fundamentally transformed the enterprise software market and points to a business model paradigm shift in the enterprise. The IDC projects that in 2013, non-IT business managers will buy 80% of new technology directly for their teamsThe shift in discovery channels has gone from a top-down IT committee approach to employees discovering applications through social media channels, peer recommendations, search, and through app stores. The low-friction sales model that is a hallmark of Consumerization of Enterprise companies is conducive to individual or departmental led initiatives that can take advantage of Freemium pricing models, credit card based payment methods, self-serve setup, community-driven support forums, and increasingly native mobile applications. The proliferation of instant-on and always connected technology such as iOS/Android powered smartphones and the rise of cutting edge consumer internet companies have served to increase expectations amongst enterprise software users. These users expect next generation enterprise applications to mimic the UI and UX developed in the consumer space, including frictionless application upgrades versus overly disruptive software upgrade cycles. Enterprise software companies that have successfully “consumerized” their applications enjoy faster innovation (i.e., software upgrades occur at a rapid pace), higher data consumption, wider deployment of software (i.e., easier consumption on multiple devices) and a better overall user experience (i.e., more usage and virality). Consumerization of ITWe see Apple, Google, Webservices, Webmail, social networks, mobility shaping the daily experience of individuals. The way how IT is consumed in the private live today is shaping the enterprise IT at the same time.The Power goes to the individual; BYOD (Bring your own device) as another example, where IT is not happy but companies do driven by LOB; social componentsSozialeKomponenten, Mobilität und die private Nutzung von CloudlösungenhabenunsereArbeitswelt und Erwartungen an IT verändertTech decision makingIDC reported that by 2016, LOB executives will be directly involved in 80% of new IT investments, 2013 already 58%There is a significant paradigm shift of budgets and the way how decisions are made; driven more from LOB than ever beforeFachbereichsentscheidersindstärker in IT Entscheidungeninvolviertalsjemalszuvor. Die Erwartung an IT sindklar - SignifikanteVerbesserung der Produktivität und BereitstellungentscheidungsrelevanterInformationen 
  • SAP’s cloud strategy focuses on four areas: Cloud Applications, Cloud Platform, Business Network, and Infrastructure & Lifecycle Management. This four-part strategy delivers the next generation in cloud computing to help customers unlock the new possibilities and benefits of the Cloud:Cloud Applications: We have over 20 applications and suites in the SAP cloud, which are designed to optimize your most critical assets— your people, customers, suppliers, and money. Each of our applications is built to empower people through beautiful and relevant experiences that are mobile, social and “glocal” – enabling global business processes that account for local requirements.  Because these applications are in the Cloud, they are fast to deploy, easy to adopt, and seamlessly updated with innovations. And, rather than forcing a “rip and replace” approach to the cloud, we’re focused on letting you adopt “your cloud, your way”. Whether you want a full Cloud suite or a selective Cloud strategy, our broad portfolio of applications and loosely coupled design approach enables you to move to the cloud in the way that best suits your business priorities. CLOUD APPLICATIONS KEY BENEFITS TO STRESSCloud meansvelocity – INNOVATION FAST at customer, FAST Onboarding, FAST Roll Out, FAST and HIGH Adoption (fast, intuitive, ease of use)Mobility first - instead of small mobile extensions, the way people work todayLess cost risk in uncertain times– pay per use, OPEX vs. CAPEX, consume your way, nearly NO cost of experimentsHigher standardization - Share Best Practice, less financial and resource risk; Adoption of cloud in commodity processesIncreased data quality  - based on higher LOB adoption – people will use moreFast innovation cycles – run always on latest release,get new capabilities every 90 daysCloud Platform: SAP HANA Cloud is a platform-as-a-service designed to help customers, ISV's and partners rapidly create innovative software applications to succeed in a world increasingly characterized by mobility and always-on social and collaborative business networks.  SAP HANA Cloud is based on SAP HANA, which means it is the only cloud platform that can help customers analyze data at the speed necessary to sense and respond to changes in their business networks.  SAP HANA Cloud is characterized by an open approach, a focus on enabling business processes with seamless integration to on premise, and providing the key services required to create mobile, social, and analytical applications.Business Network: The Ariba Business Network is the preferred network for buying, selling, and/or managing cash. Over 730,000 businesses, doing business in 186 countries around the world, are connected in the cloud through industry-leading technology, proven process expertise, and community-shared best practices. As customers look to extend and automate inter-company business processes, the Ariba Business Network gives companies the transparency and capabilities they need to execute as efficiently and cost-effectively as possible across their entire value chain; from finding and serving new customers to organizing and managing supply to optimizing cash flow. Infrastructure & Lifecycle Management: Intended specifically for customers who have invested significantly in on-premise SAP landscapes to run their mission critical applications, SAP Virtualization and Cloud Management solutions are designed to protect existing investments and minimize disruptions, while providing a staged journey into the cloud.  These solutions enable customers to unlock the direct cost savings and management efficiencies possible through virtualization and private clouds.  Additionally, customers will have the option to deploy complete, traditional on-premise, SAP test environments directly into public clouds, such as Amazon – providing speed and savings in updating SAP landscapes, while fully protecting production systems.For customers that want to deploy their internal HANA-based applications in the cloud, SAP and our partners offer a wide choice of hosting capabilities that provide highly secure environments with the advantage of cloud economics
  • PeopleEnable Business Execution Drivers that create Business Results. Solutions that help you drive better business results through empowering people and creating a compelling, real path forward, focused on business results. Improve strategic alignment, increase efficiency and productivity through team execution, and accelerate business results with people performance and learning management. Our SuccessFactors HCM portfolio (Business Execution – BizX) has a strong leader track record with proven results.   Now together with a complete Core HRIS in the cloud, Employee Central – the largest clients in the industry, THE largest installations are on EC. And another key component has been added recently – payroll in the cloud – supporting more countries and legislations than anyone else in the market.SAP delivers ‘social with a purpose’. Exploding numbers of emails, “searching context” rather than “finding” require a different engagement model for the modern employee. SAP Jam drives social enterprise capabilities to a new level of productivity. But social is not a separate layer at SAP. Social capabilities in the fabric of each solution that engages people around specific business processes, irrespective of the deployment model - like social on-boarding, social learning and social customer engagement. Customers  The Salesman of the 21st century is a social, collaborative and cross-linked persona who is able to manage customer relations in the most comprehensive and collaborative way. Sales Force Automation is legacy. Dynamics and Innovation takes place in CRM-market every day, a sales rep can´t win with 10 years old technology and weapons. The SAP Customer portfolio equips the Enterprise with state of the art tools for Social Engagement, Sales, Service, and Marketing. SAP boosts this offering with HANA because none of our customers have time to loose doing the next sentient analyses or sales forecast. And to be clear here as well – many important processes are still run on premise, so our offering like Customer 360 (including then CRM on HANA) and our integration technology is the right answer. We deliver on the integration promise – simple and scalable.SuppliersThe Ariba Network and application enables our customers from strategic sourcing to contract lifecycle management run the best in class supplier management. Size really matters, because the largest global procurement & finance network guarantees the fastest time to value and it is the most compliant global network, which gives it the lowest risk profile you can get.Our supplier solutions deliver great value to both, supplier sand buyers.Money: The next generation financial solution helps the controller and/or finance departments to deliver what they are asked for: strategic decision support instead of being stuck in transaction entryPowerful solutions leverage SAP´s long term leadership in the finance solution space with a highly modern set of capabilities to support the broader roles and responsibilities of modern CFO´sAnd of course an option if you want to run your complete finance in the cloudTravel OnDemand is a traveler-centric end-to-end solution for a #1 travel experienceBusinessCloud suites for SMBs and large enterprise subsidiaries are a fast growing market with amazing amortization times: comprehensive solutions that enable to run your business better in the cloud. Economies of scale that requires “reduced capital expenditure” in uncertainty and changing market structures require low capital investmentsJoint Ventures, mergers & acquisitions, divestments to consolidate in new and emerging markets. Next level of flexibility and speed of on-/off boarding make it easier to separate or consolidate processesStartups and small fast growing companies who want to have a clear path of growing systems – covering “glocal” needs from the start.Social (“Jam”): Jam continues as the the market leader for social in talent management. Additionally, in 2012, we closed our largest deal for collaboration software (Streamwork + BI OD) with the National Football League for 5 years. In a span of ~5 months we have laid down the foundation for SAPs social strategy and demonstrate where social can really move the needle and impact performance. Four design principles - Social needs to show up where you work. With Jam, SAP has infused a single social platform across key applications such as CRM, Finance and Human capital processes and all devices. Feeds don’t cut it. Social needs to solve problems. With social learning, social onboarding and collaborative opportunity management, SAP offers a) the first set of purpose built solutions designed naturally support what you already do today and b) the right collaborative and social metaphors for each task at hand. Most social networks miss business context and the current rate of adoption reflects this. Because of our purpose built social solutions across our applications, the Jam application now brings all your social and collaborative actions across applications and devices to a single place. With this, Jam offers a modern workbench that’s cognizant of all your collaborative process activates across all touch points.Jam is the one seamless social fabric that works across a customers customer/employee and partner engagement footprint – whether that’s all cloud, all on premise, hybrid, or with third party applications in the mix.Cloud Integration: With SAP HANA Cloud Integration, we deliver a core element of our loosely-coupled Suite strategy by providing Integration-as-a-Service capabilities. We are executing on a roadmap enabling end-to-end business processes between Cloud, on-premise, SAP and non-SAP solutions.
  • The pieces need to fit together. In the center of our strategy we delibver 20+ Apps in the cloud as SaaS.Social is the new key in Enterprise productivity, therefore we deliver SAP Jam for internal collaboration to increase productivity. Jam is an corss layer which today applies for the cloud solutions and will continue to grow alos into our onPremsieBusienss Suite to ensure collaboration in context of business objects.This context also applies to the external supply chain. People need to talk and exchange information. Mail is not the preferred option anymore as it relies on indviduals. Information is not available to the collective who needs have that information. And email is not related to the contextual business object. Jam allows to connect to the whole supply chain members (customers/Suppliers).The cloud foundation is our HANA Cloud platform; aTfansformative Platform for Continuous InnovationSAP’s platform - SAP HANA Cloud, is designed to help customers, ISVs and Partners rapidly create innovative software applications at the pace required to succeed in a world increasingly characterized by mobility and always on, social, and collaborative business networks SAP HANA Cloud is differentiated by being the only cloud platform built on HANA, which means it is the only platform that can help customers rapidly, sense, analyze and respond at the speed required to changes in their business networks. SAP HANA Cloud is characterized by an open approach, a focus on enabling business processes with seamless integration to on premise, and providing the key services required to create mobile, social, and analytical applications.•Some of the applications offered in SAP Cloud are not built on SHC.•SAP has no plans to refactor existing applications that are not built on the above platform.•SAP has chosen to embrace industry standard web-interfaces, such as REST, in our portfolio of cloud applications, this in-turn enables us to utilize this platform new platform as the preferred platform to extend ALL non-SHC based applications.Another important benefit of the platform is the integration architecture, because SAP does not follow a “rip and replace” strategy. We give our customers choice and allow to adopt at own pace and following customers´own business proirities. This makes a robust integration foundation a must have to ensure process and data integrity.This applies to SAP´s cloud offering as well as On Premise integration. In addition the world is heterogenous and we use this technology to integrate with 3rd party cloud and NON-cloud solutions.
  • Some examples of customers, who have reached fast ROI based on integration between SAP cloud and OnPremise.We call it “side-by-side approach” and ensure sustainable architecture with data and processes in synch.
  • Key message: cloud is driven by Viral AdoptionFirst of all SAP provides a consumer-grade user experience. Simply put, customers are now experiencing a kind of people-centricity they had never experienced before. End-user oriented design thinking goes hand-in-hand with social capabilities, allowing for easy and effective collaboration in business. The end user design approach in mind is the paradigm shift we are performing for exponential adoption rates.We at SAP do see viral adoption as key to success. There are several aspects of viral adoption, we made it foundation and design principles: Every application in the SAP cloud will leverage a SMART Foundation:S=Social: to make the right people aware of things that matter, when they matter (relevant expertise, new content, recent updates/activities/notifications, new insights derived from analytics, etc); Imagine. This is not just to transfer communication from individual mailboxes to collaboration in contextM=Mobile: Every SAP cloud application extends to mobile devices – iPhone, iPad, Android, and more. In fact, we even design mobile user interfaces first before extending to browser UIs. We understand that immediate access leads to maximum business agility and much better adoption in business. Think of further trends like BYOD (Bring Your Own Device). The cloud´s central processing and thin client technology enables BYOD instantly. This ensure people are able to take action where and when they need to…anytime, anywhere. In fact, for many of our applications we’re now taking a “mobile first” approach, where we design new capabilities to first work on mobile devices (example: absence management in EC).A=Analytics-Driven: Powered by HANA in-memory computing and real-time analytics to deliver instant visibility and insight across your business; what might otherwise take weeks to understand, can now take minutes…R=Relevant: Designed for the ENTIRE workforce; we’re not looking at these as “Line of Business” applications designed for LOB power users…we’re designing these as Workforce applications that can (and should!) be used by everyone…this means that we’re putting things in a “business language” that people in a variety of roles can understand—managers, employees, line of business leaders, administrators, etc. Breaking down the “lines” in “lines of business” through experiences that are relevant to the entire workforce, empowering end users, etc.T=Toy Like: Intuitive, Fun, and easy to use…this is how applications are designed for the consumer world, and it’s how people expect them to work in the business world…
  • Key message:SAP is the leading provider for Enterprise business software – in the market for 4 decades. We are used to work with customer data for our entire life. Together with SuccessFactors, an SAP company and Ariba, an SAP company we are now running the most comprehensive portfolio in the cloud as well. Data security and data privacy is part of our DNA – and to earn your trust every day is our utmost mission. Background:EU 95/46 EC, PCI-DSS, ISO 27002, BS7799, ASIO-4, FIPS Moderate, BS10012, SSAE-16/SOC2 to name the most important audit standards and certificates which applies to our datacenter and services.Physical data locationUnauthorized data access (credential steals)Data steal from insidersFirewalls to prevent 3rd party attacks Operational complianceShallow securityData PortabilityBusiness ContinuitySecurityAccording to Verizon Data Breach Investigations Report, 86% of all security breaches were accomplished by the use of stolen login credentials, making secure enforcement of employee passwords and single sign-on policies a must. For multinational companies compliance with different local codes was another top concern. No wonder Security is top of mind on the list of concerns with SaaS vendors. The location of a datacenter (e.g. especially in light of US regulations and access to data from 3rd party) fires up further discussions and IT responsibles need to know where the data is stored physically. Interesting enough we also see many US and Canada based companies asking to be hosted in an European data center. This is a severe issue where strictness of European regulations might lead to trust. And where Enterprise usage of data differs from consumerized services. Take an example “Google”. The nature of their business makes it valuable to immediately dublicate each search pattern and result to all global server farms. This ensures repeatable results. But it does not apply to Enterprise data and a determinable geographical storage location is a must.The pressure along the isobars of US based IT decision makers is security affine as well but leave enough room for a value oriented conversation afterwards while European conferences often remain too long at this point. Because security is – after all - only the vehicle to come to better results, help business become more agile and insightful and complement processes. With cloud computing the perception of security changed fundamentally. Security, data protection, and data privacy became more important. And a single case of data loss hits the whole industry. During the 80s and 90s you could have expected customers moving into your direction if a competitor failed. With cloud computing this is different as this is a new category of service. If a single company fails in the cloud, no vendor in this service can bet on more subscribers. It´s a loss-loss.This makes trust the #1 asset in cloud business and drives us handle data with the utmost discretion and strives to deliver software solutions and support that allow business-critical processes to run securely. We protect ourselves against unauthorized data access and misuse, as well as confidential data disclosure, using various measures for employees, applications, organization, systems, and networks.Integration between cloud and on premise or 3rd party cloud is an area we experience every single day. B2B and partner integration is tough. This is a tribute to the disparate integration technology. And the number of technologies continues to grow. This is a challenge day in day out, but within each technology we discover or invent a new set of best practices and design patterns to secure the solution. We provide several integration methods to meet different business needs: Packaged Integrations via integration platform with pre-packaged connectors. Community driven process maps and last but not least user interfaces for developing and deploying file-based, events and process integrations from scratch.Our Network Architecture is multi-tiered. End-user traffic is limited to the front Demilitarized Zone (DMZ) tier of Web servers only. Each single tier in the hosting environment is organized into a DMZ-like pattern. This allows a firewall or Virtual Local Area Networks (VLAN) separation between each tier. A request is individually validated before creating the next tier independent request.This are a few examples of an endless list. To answer all questions frequently we are undergoing a SSAE16-SOC2 Type II auditing twice a year.
  • Transcript

    • 1. Cloud SolutionsHybrid and user centric solutions come off as winnerBert Schulze, Senior Director Customer and Market Strategy, Cloud Business Unit, SAP AG @BeSchulze
    • 2. The market is on the move ….and SAP? By 2016, ≥ 75 % ofnew IT expenditures will be for Cloud based, or hybrid systems 20m+ 6000+ SAP Cloud SAP Cloud user customer >$1b 5000+ 20+ Cloud revenue Cloud related solutions in run rate people portfolio© 2013 SAP AG. All rights reserved. Public 2
    • 3. Cloud is sailing with the wind of three macro trends Business dynamics Consumerization of IT Tech decision making Uncertainty and changing my productivity Business managers are market structures require low involved in and driving IT social and mobile experimental costs decisions more than ever private cloud experience before Joint Ventures, Mergers, Demergers & Acquisitions to have digitized our Expectation: deliver relevant consolidate in new and relationships and created productivity improvements emerging markets require feedback loops and business insights velocity at speed of light© 2013 SAP AG. All rights reserved. Public 3
    • 4. SAP Cloud Strategy rests on a fourfold model Cloud Solutions Cloud Platform Business Networks Infrastructure & Lifecycle Management Line of Business Solutions People Customers Money Suppliers Suite Business SAP Delivered SAP HANA Cloud Ariba Virtualization & Cloud Solutions Platform Network Management Capabilities Platform Collaboration Management© 2013 SAP AG. All rights reserved. Public 4
    • 5. SAP Cloud Strategy – Lead with line of business solutions Cloud Line of Business Solutions Cloud Suite Solutions People Customers Money Suppliers Business SuccessFactors BizX Customer OnDemand Financials OnDemand Business Network and Business ByDesign Supplier Applications  Employee Central  Sales, Service, Marketing  Core Finance  Complete end-to-end Global Core HR  Strategic Sourcing Cloud Suite for medium  Social Customer  Order to Cash size businesses and  Global Cloud Payroll  Contract Lifecycle subsidiaries  Sales & Operations  Procure to Pay Management  End-to-end Talent Planning Business One Management  Project Management  Supplier Management Precision Retailing  Complete end-to-end  Recruiting Travel & Expense  Business Process Cloud Suite for small Social Impact Net Applications businesses  Learning  End-to-end for Business HANA Portal Traveler  Business Network Solutions EPM OnDemand Product Stewardship Net Financial Service Network Product Verification Cross - SAP JAM-Social Collaboration / Enterprise Analytics / Mobility / Business Network and INTEGRATION * Note: Additional solutions available from SAP’s extensive cloud applications portfolio © 2013 SAP AG. All rights reserved. Public 5
    • 6. Trading Partner Processes Supply Chain Collaboration External Collaboration: Ariba Network External Collaboration: SAP Jam People Customers Money Suppliers Business Internal Collaboration: SAP Jam Platform and Integration Customer Partner Apps Apps ISV Apps SAP and 3rd party OnPremise 3rd party cloud how the pieces fit together© 2013 SAP AG. All rights reserved. Public 6
    • 7. Recent Customer ExamplesQuick time-to-value with integrated SAP cloud solutions SAP Customer SAP Customer SAP Travel OnDemand OnDemand OnDemandSAP ERP SAP ERP Legacy Legacy SAP NetWeaver SAP ERP HR SAP ERP (Finance)(Division 1) (Division 2) (Division 3) (Division 4) BW  Multiple SAP and legacy backend systems  Improved effectiveness of customer-facing teams  Employee data feed from non-SAP HR system  Central SAP Sales OnDemand deployment across  Real-time SAP ERP integration for customer and  Automated expense report creation per trips booked divisions material master data  Automated posting to FI accounts and A/P  Integration to non-SAP systems planned in phase 2  SAP NetWeaver Business Warehouse (BW)  Automated approval process and credit card feed mashups for POS, invoices, open orders© 2013 SAP AG. All rights reserved. Public 7
    • 8. Cloud solutions are adopted, if … User friendly Relevant for ME Fast Mobile© 2013 SAP AG. All rights reserved. Public 8
    • 9. Along the IT service isobarsSecurity remains an important topic© 2013 SAP AG. All rights reserved. Public 9
    • 10. Summary – Five essentials for leading in cloudThe most Enable the cloud Put the end-user Design the cloud Security is #1comprehensive for Ecosystem in the Center of hybrid - respect concern in thecloud portfolio and Partner the Design existing cloud. Deliver investments along the IT service isobars© 2013 SAP AG. All rights reserved. Public 10
    • 11. Thank you!Questions…?Bert O. SchulzeCloud StrategySAP AG @BeSchulze© 2013 SAP AG. All rights reserved. Public 11

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