According to Gartner, the public cloud services market will grow 18% in 2017 to total $246.8 billion. By 2020, SaaS is predicted to be at $75.7 billion, IaaS at $71.5 billion, and PaaS at $56.1 billion, comprising a total market of $383.3 billion, Gartner adds.
Growth in the infrastructure compute service space will be enhanced by artificial intelligence (AI), analytics, and the Internet of Things (IoT), while the growth of PaaS will in turn also drive the growth of IaaS.
Two Modes, One Strategy
It was also Gartner who first coined the term “bimodal” to describe two fundamentally different but nevertheless complementary ways of working that address different goals. Mode 1 focuses on stability and the integration of all kind of applications running core enterprise processes, as such emphasizing predictability and reliability, while mode 2 is all about digital enterprise platforms, emphasizing agility and speed.
While mode 1 and 2 address different goals, they should be considered as a whole because both modes are fundamental and needed for highly integrated end-to-end processes. An IT strategy fit for the digital era requires both. At SAP, we believe you cannot win in both worlds if you limit your innovations to Mode 2 only. There are two things that matter to make your IT landscape – and as such your company – fit for the digital age: You need to modernize your core, and beyond that, you need the technology that allows you to differentiate to win.
To truly stay competitive, growth is just as important as keeping the business up and running. Companies need a platform that enables them to digitalize their existing IP and leverage all the capabilities in which they have invested in the past. They will need an enterprise-ready PaaS that allows them to innovate with microservices and APIs, and evolve with the help of technology services like integration, user experience, machine learning, connectivity between things and people – the list goes on and on.
An Evolving Platform
Three years ago, we launched our PaaS offering, known at the time as SAP HANA Cloud Platform. The original offering included SAP HANA as a database-as-a-service with capabilities to develop secure, mobile HTML applications and integration services.
Since then, it has evolved from a standard PaaS solution to an innovation platform in the cloud that supports businesses as they transition into the digital age. Today, SAP Cloud Platform offers plenty of application services designed to meet the needs of companies looking to leverage innovative technologies such as IoT, machine learning, artificial intelligence, and big data on a cloud platform.
To represent this breadth of capabilities, SAP HANA Cloud Platform has been rebranded as SAP Cloud Platform and expanded to include new enhancements and capabilities that power our customers’, our partners’, and our own innovation.
It continues to be an agile in-memory cloud development and deployment platform with SAP HANA as a differentiating capability. However, as SAP Cloud Platform has evolved to enable our customers to integrate, extend, and build applications in the cloud to meet their business needs, the power of SAP HANA is now complemented by a number of other very compelling capabilities and services.
To date, SAP has delivered 37 cloud applications on top of SAP Cloud Platform. SAP Cloud Platform is also the platform for SAP Leonardo, our digital offering that brings together Machine Learning, IoT, Blockchain, Analytics and Big Data.
A Digital Highway for Improved Collaboration
Let me share a customer story that shows how SAP Cloud Platform has helped one company transform its business for the digital age.
MAPAL, founded in the 1950s, a leading provider of precision tools to the automotive, aerospace, and hi-tech industries, recently saw a new opportunity in the C-tool space. C-tools are items such as solid carbide cutters and precision clamping chucks, which are considered essential for many precision tooling businesses and are sold on a very frequent basis.
Because of the high volume of transactions involved, the C-tool business generates massive amounts of data – process data, inventory data, master data – that is manually exchanged between parties across the tool ecosystem.
MAPAL saw the opportunity to take collaboration across this ecosystem to a new level and chose SAP Cloud Platform to build a digital highway that enables data to be shared and improves collaboration between customers and suppliers.
With increased transparency and collaboration, all parties in the MAPAL ecosystem can achieve an unprecedented level of efficiency. They gain instant access to unmanned inventory monitoring, detailed analysis options, and easier order processing while promoting loyalty across the ecosystem.
By choosing SAP Cloud Platform, MAPAL got exactly what they wanted: a means to digitally transform their business. Cloud is the way to go, and we are just getting started. With SAPPHIRE just around the corner, stay tuned for more stories on how SAP is supporting companies in running, steering, and differentiating their business to enable innovation while still sustaining their core investments.
Bernd Leukert is a member of the Executive Board of SAP SE.