Q&A with SAP CEO Bill McDermott: SAP Solution Portfolio

We recently talked with SAP CEO Bill McDermott to get his perspective on market dynamics and SAP strategy, SAP’s solution portfolio, and how companies can work with SAP to accelerate value creation through digital technologies.

In this Q&A series, we will feature highlights from the conversation on each of these topics. This installment focuses on the SAP solution portfolio.

Let’s get into SAP’s products. You have a lot going on — cloud, SAP HANA, networks, new breakthroughs. Help customers understand the big picture.

It always comes back to that consistency of what we started back in 2010. Over the past seven years, we’ve invested more than $50 billion in innovation for our customers. When you think about how that portfolio has evolved, I would offer you a simple framework: we help our customers “run” as best-run businesses, and We help them innovate to “win.” This is consistent with what you hear from the analyst community— the idea of bi-modal innovation or, put another way, habitual innovation across the business.

First, our customers need to “run.” The key for SAP is delivering the solutions our customers need to run on a day-to-day basis in 25 distinctly different industries and 12 increasingly strong lines of business. This portfolio is embedded with best practices and domain expertise from SAP and our open partner ecosystem.

Customers are also innovating to “win.” We want customers to have a state-of-the-art platform to codify their differentiating processes, products, and services on a consistent data model.

You can’t separate these two categories. They need to work together in one virtuous cycle. The CEOs I speak with make it clear: “Help connect the supply chain to the demand chain in any channel on any device—that keeps me in the game. Then help me disrupt my own business with the latest break­throughs so I can be ahead of my competition.” SAP is the only company that is prepared to lead on both fronts.

Can you describe SAP’s new digital business suite?

Our cloud-based portfolio powered by SAP HANA and built with a world-class user interface, SAP Fiori, is based on five fully integrated solution categories.

It all starts with a fully integrated digital core: SAP S/4HANA represents the most preeminent cloud-based ERP solutions in the market running in real time powered by our in-memory platform. This digital core encompasses the very best practices of SAP’s 45-year history.

Second is the customer experience: SAP Hybris solutions are #1 in B2B and B2C commerce. Every business wants to reach individual consumers in every channel, on any device. SAP Hybris solutions are at the forefront of the digitized customer experience, marketing and sales force automation.

Third, is the people: They are the past, present, and future of any company. With SAP SuccessFactors and SAP Fieldglass solutions, we are the only company that can deliver visibility into the total workforce and drive end-to-end talent management. We are also bringing machine learning to workforce engagement, like eliminating bias in the hiring process, and intelligently matching candidates to specific job openings.

Fourth is assets and supply chain: With technologies like IoT, blockchain, and machine learning, we are truly reinventing how assets and supply chain are going to be run in real time with predictive analytics. This will unleash an enormous amount of productivity in the manufacturing and logistics industries.

Fifth is supplier collaboration and spend management: With SAP Ariba, SAP Fieldglass, and Concur solutions, we are the only company that can manage every spend category from procurement to contractor labor, to travel and expense. This is not something that can be accomplished within the four walls of a company. It has to extend to a company’s ecosystem— true “inter-enterprise computing.”

Help customers understand SAP Leonardo. What is it and how do they consume it?

SAP Leonardo is the result of hundreds of innovation scenarios we built with our customers over the last three to four years. From that experience, we came to several conclusions that are critical for delivering and sustaining innovation at scale:
•Most innovative scenarios require a combination of the new technologies, which I already mentioned. As an example, a predictive maintenance scenario requires IoT services to acquire data from sensors, Big Data storage for managing data, predictive algorithms to make sense of the data, and access to application program interfaces (APIs) from our core ERP solutions to coordinate and execute the actual asset repair. The power comes from all of these technologies—machine learning, IoT, Big Data, blockchain, and analytics—working together to differentiate based on the hidden knowledge behind the data. Only SAP HANA can unlock that seamless value for our customers.
•SAP Leonardo is the most vivid example of the new, open SAP. We know that we can’t do everything for customers on our own. We need to partner with industrial companies, become more open source with innovation categories like machine learning and blockchain, and open our architecture. This is a much different statement than many would ever expect to hear from SAP.
•To make SAP Leonardo data-rich, we’ve also adopted open source platforms, like HADOOP, machine learning algorithms, and blockchain. Our customers are looking for a one-stop shop for our innovation, so we are making that happen at the lowest possible cost.
•We are once again giving customers a choice so they can host SAP Leonardo in the best way for their business. We are of course offering SAP Cloud Platform as an option, but we are also certifying our technology on other advanced cloud infrastructures like Microsoft Azure, Amazon Web Services, and Google Cloud Platform. We may certify other platforms, but our goal is to provide a choice for how companies consume our technology. When you think of strong companies like IBM, Dell and Hewlett Packard Enterprise, there is so much capacity out there.

Download the entire Q&A with SAP CEO Bill McDermott.