In June, SAP rolled out a new suite of applications created to advance its market share and shake up the CRM market. The portfolio, called SAP C/4HANA, includes applications and services from acquired companies such as Hybris, Gigya, CoreSystems, and Callidus Cloud.
Today, participants can expect to learn about updates to SAP C/4HANA solutions, customer benefits from the current portfolio, and what the future of CRM holds at the SAP Customer Experience LIVE event in Barcelona, Spain.
Ahead of the event, Moritz Zimmermann, chief technology officer of SAP Customer Experience, shared his thoughts about the experience economy, why customers need an integration platform for digital transformation, and what’s hot in CRM innovation.
The Experience Economy
Zimmermann explains that in a global economy where consumers can get anything online easily and quickly, experience is the key differentiator: “We live in an experience economy. Eighty percent of consumers pick a product or service based on experience — it’s not just about it being cheaper or available.”
What is experience and how do you make experience great? Zimmermann says that design and usability are the first step but ultimately, companies must be able to connect customer experience on the front end to a digital supply chain on the backend. Only the integration of those two pieces will ensure a great user experience.
He provides this personal example to illustrate: “A couple of weeks ago I wanted to hike in the mountains with my kids, and they’re both little so I wanted to be prepared for when they got too tired to keep hiking.” Zimmermann bought a stroller online on Monday before the weekend. The website said it would arrive Wednesday. “But it didn’t come Wednesday, Thursday, or Friday. The result? I had to carry my eldest child for 90 minutes and my back hurt for three days afterwards.”
That was a bad experience because the company didn’t tap into its supply chain. It’s not enough for sellers to promise a two-day delivery, they need to execute. That’s why companies like Amazon have invested in both the digital supply chain and the physical infrastructure — such as warehouses and airplanes — to keep promises to consumers.
SAP has stepped up to the challenge by integrating front-office SAP C/4HANA solutions with back-office SAP S/4HANA applications. This means companies can use front-end applications to engage intelligently with customers while making sure back-end business processes — like procurement, manufacturing, and fulfillment — are aligned. Together this intelligent infrastructure means that when someone places an order and is given a delivery date, the right product will arrive on time.
SAP Cloud Platform Extension Factory and Digital Transformation
At SAP Customer Experience LIVE, SAP Cloud Platform Extension Factory will at the top of the agenda. This platform, based on the open source project “Kyma,” is part of SAP Cloud Platform and allows developers to connect and extend applications in one environment.
With SAP Cloud Platform Extension Factory, developers can easily integrate SAP C/4HANA applications quickly (it also works with non-SAP applications), reducing rollout time from months to days — at a lower cost. Zimmermann also explains the platform allows developers to be more agile and innovative because they can iterate rapidly, without impacting their current IT infrastructure.
SAP Cloud Platform Extension Factory will also help companies with digital transformation projects, says Zimmermann. “In digital transformation, businesses are being disrupted by new players leveraging technology as their competitive weapon,” he says. “Business models are changing; they are becoming more outcome-oriented. For example, automakers now want to sell mobility rather than a car for 50,000 dollars.”
Put simply, software is driving companies’ business model, value proposition, and approach to product innovation. Zimmermann provides another example: A grocery wholesaler in Germany buys in bulk and sells primarily to small restaurants. Now the wholesaler offers restaurant owners a mobile app that lets them photograph their menu and use artificial intelligence (AI) to analyze entrees, and the ingredients required, from a recipe database. It then provides the restaurant with profit margins for each dish. Rather than just selling food, the wholesaler now sells insight into the profitability of restaurateurs’ dishes.
This kind of transformation means all businesses need to think like software companies, which takes incredible speed and agility. SAP Cloud Platform Extension Factory helps developers use SAP C/4HANA applications together quickly and easily — and embed functionality like machine learning or analytics into them.
Artificial Intelligence Is Hot
Unsurprisingly, AI is the hottest market trend in the CRM applications. SAP has been quietly embedding AI across its customer experience applications for many years. “We’ve been using AI-based driven capabilities for years and have more than 30 capabilities live across all the different SAP C/4HANA clouds,” Zimmermann says.
For example, companies use machine learning from SAP to ensure that service tickets are automatically classified and sent to the right expert. Another example is sales deal intelligence, which SAP has piloted internally. “Sales forecasting used to be an art not a science,” says Zimmermann. “Often deal forecasts for a quarter are based on a gut feeling. Now we use AI to see if customers are opening our sales team’s proposal, how quickly, if they responded to email, and other factors.” The solution can even pick out regional differences in the accuracy of quarterly sales forecasts.
Expect to hear about more CRM innovation this week from Barcelona. Stay tuned.