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It’s been an exciting time here at SAP with news of our agreement to acquire Qualtrics. We believe that the combination of Qualtrics’ Experience Management (XM) Platform with SAP’s enterprise software and cloud services is a game changer for companies to measure, monitor, and act on the feedback of key audiences in real time.

What is Experience Management?

Qualtrics has pioneered an entirely new category: experience management, or XM. With Qualtrics, data collected about an experience (X-data) – whether it is about customer, product, employee, or brand – provides a richer, more immediate, and more salient understanding of the quality of an experience than traditional data sets. Make no mistake, we’re not talking about a simple surveying tool. The Qualtrics XM platform helps businesses know what is happening in the moment, with customers, employees, or any mission-critical audience. This is significant in an “I want satisfaction now world,” because businesses or organizations can use X-data to course correct or double down based on what they’re hearing in real time.

Simply put, Qualtrics helps companies close experience gaps. When a consumer or employee expects a certain experience, but a brand or employer falls short, that creates an experience gap. A negative gap requires immediate attention to prevent detrimental consequences, such as lost customers, employee turnover, diminished competitiveness, and opportunities for businesses to be disrupted.

Think about the typical consumer environment. You purchase an item only to return it. What is the process to understand why it was returned? Was it the consumer, the quality of the product, or unmet expectations of it? When you have experience data on your products taken from multiple channels, you can begin to connect the customer sentiment to the reason behind returns, to detect patterns. These real-time patterns can lead you to make immediate changes to your production, manufacturing, or engineering processes that have never before been possible.

Conversely, great experiences drive customer loyalty, employee engagement, improved retention, and referrals. Companies can use experience data to more quickly assess how their customers feel about their products or services. If a product being tested or developed is an unexpected hit with customers, a company has the right data to make fast decisions on how to act, such as increasing production, inventory, or adjusting marketing to better capitalize on demand. This is what Qualtrics’s XM Platform enables.

The Key is Speed

Speed is essential. Period. Businesses that lag in transformative decision-making become obsolete. Let’s not be fooled. If it can happen to some of the biggest, most notable brands, it can happen to any business in any industry. Speed is the key ingredient that makes the union between SAP and Qualtrics so incredible. Unlike typical feedback and survey mechanisms, Qualtrics’ XM Platform provides a real-time aggregation of feedback from any engagement method — direct customer survey feedback, social, web, in-app, email, and more.

With this union, we are poised to combine more than 1 billion records of experience data together with operational data from 77 percent of the world’s transactions that SAP systems touch. These are two of the global economy’s richest data sets: experience data (X-data) from Qualtrics that tells you why and operational data (O-data) from SAP that tells you what is happening. Together they paint a complete picture that fuels intelligent enterprises so they can deliver superior experiences, creating a virtuous cycle.

This is a very transformative moment. The next evolution of enterprise applications has begun with a real-time connection between the X-data in the system of action and the O-data within the system of record. Our ability to apply intelligence and machine learning atop these co-joined data sets unleashes the unprecedented power of the new experience economy.

Think about ways that companies try to understand their customers or employees. Most tools show broad feedback but lack precision and speed. The timely process of surveys and manual feedback collection can take months to collect and analyze data. By the time decisions are made and products fixed, the world has moved on. A quintessential case of “too little, too late.”

Consider the feedback airlines most frequently ask about: the condition of the plane, the boarding process, ticket purchase, seat location, timeliness of arrivals. How do those insights connect to paint a broader picture? Can airlines decipher whether customer service feedback is related to how the airline or its personnel operate? Can they analyze the data for commonalities of the most amazing passenger experiences down to a single flight attendant, gate agent, or process? In today’s world, it’s impossible.

Take my own recent experience with a newly offered delivery service. Circumstances led me to pay more for delivery of items than I’d typically ever consider. Was my experience fast and easy? Yes. But am I a repeat customer candidate? Unlikely. Had this company attempted to garner more insight on my complete experience, they would have learned that small adjustments to the experience — customer incentives, delivery price point incentives, or loyalty advantages — could have completely changed my perspective. If only they had the insight and the ability to act.

In the experience economy, your advantage is how quickly you can respond to feedback and trends — positive or negative. In the experience economy, it’s not just about what you know, but your ability to act on that insight with confidence and speed.

The Whole World Becomes Interactive

Think about it: Like an orchestra that builds a following because of its finely mastered group precision producing melodious masterpieces, businesses create loyalty based on holistic, end-to-end experiences. With the addition of Qualtrics, SAP continues to shatter the wall between the front office and the back office, understanding that the greatest experiences require a foundation built on an intelligent enterprise.

Together, SAP and Qualtrics will deliver the only end-to-end experience and operational management system. Will your company be ready for the realities for newly interactive world?

Read the press release


Robert Enslin is president of the Cloud Business Group and a member of the Executive Board of SAP SE.