Some of Latin America’s best millennial minds are partnering at the newly inaugurated SAP Co-Innovation Lab (COIL) in São Leopoldo to deliver next practices for the world. The new lab complements the existing COIL location in São Paulo, founded in October 2010.
What others call reverse innovation, Stefan Wagner, MD of SAP Labs Latin America, calls “next practices.” A perfect example is the energy theft solution that was developed with the SAP Co-Innovation Lab Brazil by Choice, an energy intelligence company that runs its revenue portfolio solution on SAP HANA. While commonly associated with countries like Brazil and India where people regularly tap into power lines and bypass meters to access electricity, energy theft is actually the third largest form of theft in the United States. This kind of innovation creates new market opportunities for a product that was developed to address a specific problem in developing countries.
Understanding what mobile means
Julio Fabio Chagas of MC 1, the Brazilian solution provider that “does mobile right,” says the strategic partnership with SAP enables his company to do a better job about evangelizing in the market to help companies understand what is mobile and what isn’t. “Everyone may be talking about mobile and cloud, but that does not mean people know exactly how those technologies work or how they impact business,” says Chagas. “Thanks to our work with the SAP Co-Innovation Lab, we got a different perspective of what mobile means in the local market. SAP acts as a facilitator, lends credibility and provides a risk-free development environment. But it’s not just about development. One of our key deals with a large Brazilian food retailer would not have happened without sales and presales support from SAP. And of course, the fact that the customer wanted a single platform instead of many different ones. SAP fit the bill with SAP Mobile Platform (SMP).”
Next page: How co-innovation works
Since its inauguration three years ago, the SAP Co-Innovation Lab Brazil has worked with over 50 companies from the Brazilian and Latin American Ecosystem on innovation projects in categories such as mobile, analytics, and Big Data across various industries. The current approach provides partners and SAP a structured process to jointly produce innovative solutions that complement the SAP portfolio and ultimately increase overall value for customers.
Axel Saleck, VP Global SAP Co-Innovation Lab Network, describes the process and benefits of co-innovation by telling the story of the SAP Tax Declaration/Management Framework. Back in the 1990s, SAP invested heavily in localizing standard products to help Brazilian companies remain compliant to the world’s most complex tax system. SAP provided the platform and standard solutions, and an ecosystem of local partners emerged, specializing in different areas of legal and fiscal expertise to deliver holistic solutions to customers. Those investments paid off as SAP has been the market leader in this area for decades.
SAP HANA, tax tool, and legal and fiscal expertise
The SAP Co-Innovation Lab takes this a step further by offering partners the opportunity to develop and run prototypes for real time fiscal analysis simulations using the Tax Management Framework powered by SAP HANA, also offered in a cloud environment. SAP partners now have access to state of the art technology to address customer issues using design thinking methodology and other out of the box approaches. Whereas technical co-innovation environments for Latin America were previously delivered to the partners out of Singapore or Palo Alto, now the interaction is based in Brazil out of São Leopoldo. Customers are pleased with the holistic solution: they get powerful in-memory database technology (SAP HANA) and the Tax Development Framework (TDF) tool from SAP, and they get specialized legal and fiscal expertise from their preferred partner, who gets know-how, best practices, and access to the development environment at SAP’s COIL.
Next page: The ingredients of co-innovation
According to Stefan Wagner, these kinds of technology “next practices” require two key ingredients: a talent pool of millennials with the right skillset to drive innovation locally and globally, and a state-of-the-art work environment for co-innovation with customers and partners. SAP Labs Latin America has both.
“Our talent pool stems from our unique relationship with academic institutions,” Wagner explains. “SAP Labs Latin America is located next to some of the top universities in southern Brazil, making it easy to foster local talent through internships. We offer one of the most innovative and modern work environments in the entire region. Having a great place to work stimulates maximum creativity among our employees and helps ensure we can provide the best service and support for SAP’s 14,000 customers in Latin America. We just inaugurated our second building, LEED-certified for sustainable practices, which houses the SAP Co-Innovation Lab and other spaces where our teams can engage very closely with customers and partners.”
Connecting with university students across the continent
The relationship with universities is important. SAP University Alliances (UA), a global initiative with more than 1,470 academic institutions and 8,400 lecturers teaching the latest SAP technologies, aims to grow its presence by 300 percent in the region during 2014. “We have a tremendous amount of local support to enable students to access SAP’s latest innovation,” says Ann Rosenberg, global head of SAP UA. “We took part in the launch of the SAP Labs in São Leopoldo in Brazil, and we were blown away by the energy, the creativity, and the commitment of the SAP employees that had been recruited directly from partner universities. There is a wealth of talent and enthusiasm, and we aim to build on this by engaging with 200,000 students across the continent, making them aware of all the great things we are achieving as a company and the opportunities for students and professors to engage with SAP HANA, mobile, analytics, and all of our other great solutions.”
Next page: Tackling the big issues of the future
SAP Labs Latin America has been recognized by the Brazilian government as a Research & Development center, and over 80 successful co-innovation projects have been completed with customers and partners using Design Thinking methodology. This combination of analytical and intuitive thinking helps address the paradox prevalent among many customers who want to have reliable, unique solutions based on global best practices while having the flexibility to experiment with innovation.
The recently expanded lab landscape enables the kind of out of the box thinking that will help SAP jointly drive advances in technology with partners and customers to tackle the big issues of the future, such as big data or huge population growth in urban areas.
SAP shows commitment to Brazil
Luciano Ramos, a software research analyst for IDC Brazil, summarizes the significance of the development center: “The expansion of SAP Labs Latin America is proof of SAP’s commitment to Brazil, as exemplified by the focus on fostering local talent, co-innovation with partners of all sizes, and the evolution of initiatives to localize standard products such as the Tax Management Framework (TMF) tool.”