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Speed and Clarity Drive SAP's Success
SAPPHIRE '09: Keynote addresses by several SAP executives reflect the company's desire to quickly deliver business value for companies during the downturn.
Posted May 14, 2009
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ORLANDO, FLA. — Speed and clarity continued to be key value propositions emphatically echoed by SAP executives during SAPPHIRE '09, the German software company's annual user conference held here this week. A keynote delivered by SAP Cofounder Hasso Plattner, in fact, went to great lengths to impress upon the crowd of attendees that the sheer speed of modern computing means companies must ramp up immediately or risk being left behind.

[Editors' Note: For more of Christopher Musico's coverage from SAPPHIRE '09, see his earlier destinationCRM.com news story here, and his blogposts here and here.]

Plattner began his address by warning attendees he'd be speaking to them not as a vendor executive but rather as a kind of professor, delivering a lecture about how the formerly abstract concepts generated in the halls of academia and among computer scientists can now produce clear business benefits. "Increased bandwidth is a reality today," he noted, as an example. "We can build different enterprise applications to make you better understand your own data. We collect an unbelievable amount of [data], but how to digest, interpret, and derive information from data is still slow -- or is actually getting slower -- because of the increased size of our databases."

This paradox can be a killer, Plattner said, especially in today's economic environment. Decisions must be made quickly, in part because circumstances shift quickly. Giving an example of SAP's own battle with this conundrum, Plattner recalled that "in the beginning of [last] August, SAP thought it would have the best quarter ever…by the end of [the month] we thought it would be a good quarter. But, the outcome, as we all know, is that we didn't do so well."

This real-world example -- not only of corporate performance, but of corporate transparency -- underscored Plattner's contention that a delay of even two minutes in receiving data requested by a database query is, oftentimes, simply too late. "The reality is we take data out of our production [and] transactional systems; [utilize] a process called extract, transfer, and load into a business [data] warehouse; and from there we create large cubes for reporting, and report against those," he said. "This is not appropriate anymore. I don't want to change everything we did in past, but want to make it tremendously faster…and I predict it will change how we work."

Shaking up business-as-usual for companies is of the utmost importance today, according to the previous evening's keynote by Bill McDermott, president of global field operations for SAP, and Jim Hagemann Snabe, a member of SAP's executive board.

McDermott described our current economic cycle as one that occurs "every seven to 10 years." The difference this time around, he said, is that the cycle is driving structural change in every industry and market segment worldwide. "In order to lead in this environment, you must align business strategies, enablement of information technology, and business outcomes," he said.

Snabe explained that there are four forces shaping what he called "the new reality":

  • business network transformation;
  • technological innovation;
  • business models; and
  • business outcome.

All of these, Snabe added, involve the idea of sustainability -- a topic discussed at great length during SAP Co-Chief Executive Officer Leo Apotheker's keynote address on Tuesday. "The world is looking for ways to deal with the new reality, and [technology] is ready to deliver a new level of value," Snabe said.

Increased speed and technological innovation are beneficial, of course, but McDermott plainly stated that everything boils down to having the transparency necessary to perpetuate successful business outcomes. "Changing your business model is very important, but [it's] only one thing," he said."Having clarity to execute is another. Business insights are more important now than ever, and the fact is [that] too many business professionals today lack the clarity to run their business[es]. Instead, they operate in a world of data complexity and rear-view information."

To drive business outcomes, McDermott argued, companies must use technology strategically. He and Snable outlined three steps necessary to do so:

  • Discovery — benchmarking areas of your business -- such as supply chain management -- and looking for improvement opportunities;
  • Realization — turning to business-process design to understand how a solution might work specifically for the business in question, and to gauge the value expected; and
  • Optimization — implementing the business-process designs and measuring them to ensure the delivery of the expected value.

A legitimate argument can be raised that these phases should always be applied when considering technology investments, but McDermott inistsed to attendees that the hard economic times are ushering in a renaissance of rigorous implementation best practices. "To be clear," he said -- echoing once again one of the company's key concepts for SAPPHIRE '09 -- "this has always been relevant. It just has never been more relevant than it is now."

News relevant to the customer relationship management industry is posted several times a day on destinationCRM.com, in addition to the news section Insight that appears every month in the pages of CRM magazine. You may leave a public comment regarding this article by clicking on "Comments" at the top; to contact the editors, please email editor@destinationCRM.com.

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