The Next Generation of Cloud

Photo: SAP
Photo: SAP

You’ve heard the rap: SAP is an enterprise software company. SAP is expensive. SAP doesn’t get the cloud. But as the one-year anniversary of its acquisition of Ariba approaches, a different picture is emerging.

While others have been talking about the cloud, SAP has been quietly transforming itself into a force to be reckoned with. Fueled by a portfolio of cloud solutions that is arguably the most comprehensive in the industry and an aggressive strategy to market and sell them, SAP is fast marching towards its goal of becoming the world’s leading cloud company.

Robert Calderoni, President, SAP Cloud and a member of the SAP Global Managing Board, reflects on the transition and provides a view into what lies ahead for SAP. A year ago, you took on a tall order to unify cloud business at SAP and deliver the “next-generation of cloud.” How are things coming along?

Robert Calderoni: We’ve put in place the team and organizational structure to define and execute a unified cloud vision and we’re executing well against it:

  • We have the industry’s largest base of cloud users at 30 million plus. More business professionals use cloud solutions from SAP than from any other vendor on the planet.
  • We offer the most comprehensive cloud portfolio – covering all lines of business – from customer to supplier…and everything in between.
  • We own the leading social business platform with more than 10 million users. That’s more than Chatter and Yammer, for example.
  • We operate the world’s largest business network, with more than one million connected companies transacting over $465 billion in commerce on an annual basis.
  • We’re behind the largest business cloud implementations in the world – some with more than two million users.
  • Our public cloud application portfolio is ranked number one in HCM, Procurement, Business Networks, and Social Business Collaboration) and we operate the most trusted private cloud environment.
  • Our cloud platform gives companies the agility to drive new levels of innovation and adapt business processes faster than ever before.


Next page: The cloud is no longer just about IT Lots of other companies seem to be embracing the cloud. How does SAP differentiate itself in what’s becoming a crowded and increasingly competitive environment?

Calderoni: The more companies that give businesses flexibility and choice around how they deploy technology, the better. But businesses today need more than just flexibility. The convergence of trends like mobility, social networks and Big Data is creating an opportunity for businesses to rethink the future and drive unprecedented transformation.

The cloud is not just about total cost of ownership anymore. And it’s no longer just about IT. We’ve entered an era where major technology decisions are made outside the IT department and the office of the CIO. In fact, IDC predicts that by 2016, 80% of new IT investments will directly involve LOB executives as the lead decision makers in half or more of those investments.

The cloud built for business

Today’s cloud is about driving business innovation and agility. And this is where SAP is focused. SAP is, if you will, “The cloud built for business.” We have over 40 years working with businesses – some of the largest and most successful ones at that. While others have tried to get involved in business at the fringes, SAP is embedded in organizations and we have been a trusted partner for years. And we bring this same experience to the cloud.

Next page: The future of cloud computing What does the future of the cloud – and SAP’s place in it – look like?

Calderoni: In today’s “always-on” culture, we can see and be seen, talk and be talked about like never before. We can discover, connect, and collaborate with peers and partners across the street or around the globe more efficiently than ever before. We can glean insights and intelligence from entire networks that enable us to learn from the past, capitalize on the present and chart an effective course for the future – all in real time. But business is moving faster than ever. And SAP is moving with it and helping companies not only sense the present, but see the future and proactively shape it to their advantage.

To get and stay ahead of the competition, companies have to harness the unprecedented amount of information available to them to anticipate risks and trends in the market, analyze the right course of action, and act on these insights before their competitors. They must, in short, become predictive businesses. And this requires four things: the convenience and agility of the cloud; the connectivity and insight of social and business networks; the power and speed of in-memory database and analytics; and the accessibility of mobile. SAP is the only company that can deliver all four.

How to avoid missed opportunities That sounds a little futuristic. Is that something customers want at this point?

Calderoni: It’s something they need. Companies that don’t accurately anticipate customer demands run the risk of designing products that fall short of their needs and fail in the market. Those that fail to sense the potential market, commodity, or supplier risks in their tier-one and sub-tier supply chain face not only higher costs but missed sales opportunities in the market. In an age of social collaboration, organizations that rely on traditional methods to monitor employee performance, manage communications, and drive collaboration may not only see poor execution, but also increased defections. Businesses without a clear view of their spending will miss opportunities to control their costs and more effectively manage their capital.

Next page: Examples of predictive business

Data mining and social media analysis

Companies that embrace predictive business can avoid these pitfalls and vault ahead of the competition. Take Cisco. The company’s strategic marketing group mined historic data and social media mentions for customers who revealed both a propensity to buy and a high readiness to buy. Their sales force then converted that insight to a sales uplift of $4.2 billion.

EMI Music, now Universal Music Group, tapped thousands of data points generated each day for the artists it manages that reveal how particular customer segments are responding to them. As a result, they were able to identify relatively unknown artists whose data signals showed strong market potential, and ride them all the way to number one hits.

Consistent with our mission to help businesses run better, we will help companies not only think about the future, but to act in ways that enable them to deliver the business of tomorrow today.