Is SAP HANA an unlikely combination with midmarket businesses? The German weekly publication VDI Nachrichten doesn’t think so, saying, “This SAP technology called SAP HANA has now made it to the midmarket for the first time. Schukat Electronic in Monheim am Rhein (Germany) wants to use the software to accelerate its processes as well as gain a complete overview of process runtimes.” (June 29, 2012) In this interview, Andreas Naunin, on the management team at SAP Partner All for One Steeb AG, explains why things are set to change for SAP HANA and the midmarket.
SAP.info: What is your impression of the number midsize companies deploying SAP HANA today?
Andreas Naunin: At All for One Steeb, we look after the biggest installed base of midsize SAP customers in German-speaking countries, and have seen that the demand for the new technology has increased dramatically. This no doubt applies to the entire midmarket, beyond German-speaking borders, too. Many companies were curious, and this was followed by an evaluation of different scenarios in which the technology could be used. The first specific use cases are providing convincing results. It is less the pure technology but much more the business benefits of completely realigned business processes that determine market success.
Can you give a specific example?
I know a midsize food manufacturer with annual sales of around €150 million. It has one product, which it supplies to 50 different countries. The only difference is a sticker on the packaging that informs the consumer about what’s inside, depending on the specific country. This food manufacturer said that if they could perform a daily planning run for their supply chain, they could increase their revenue by 10%. They managed to do this with in-memory technology. The company invested a seven-digit sum and achieved time-to-value in less than 12 months.
Next page: Where are the stumbling blocks?
That’s an encouraging example. But isn’t the midmarket still too immature for SAP HANA?
The midmarket emerged strengthened from the difficult years between the end of 2008 and the beginning of 2010. In spite of the crisis, many companies not only hung onto their staff, but also invested consistently in new products. That’s why many of our customers are viewed as hidden champions and global market leaders. This forward-thinking strategy is now being followed more by process innovation. The IT agenda in the midmarket is defined by cross-location and international software landscapes; operation with an external cloud provider, including e-mail systems whose availability requirements surpass even those of ERP applications; planning and control to countersteer before things go off course; and – naturally – mobility so that ERP access is possible from anywhere. In all of these aspects, SAP HANA is beginning to play an important role.
Where do you see stumbling blocks?
Some companies don’t want to amass their own SAP HANA expertise. In such cases, we – as a full-service provider – take over the existing infrastructure and operate it from our data centers before we add the in-memory technology. It’s often the case that a system can be accelerated more easily if it has been consolidated beforehand. Fewer interfaces often mean less maintenance is required. Where the in-memory solution can bring benefits without prior consolidation, we deploy it right away and then consolidate the system landscape at a later stage.
Despite SAP HANA offerings aimed specifically at the midmarket, like SAP HANA, Edge edition, for example, do you think midmarket companies haven’t yet understood that they’re also a target group?
Technologies alone are rarely sure-fire successes. While major corporations can gauge and analyze the benefits of innovations with their own resources to a much greater extent, midmarket companies work more closely with external consulting partners.
Could you make a prediction? What do you think the relationship between the midmarket and SAP HANA will be like in one year? And in three to five years?
Currently, it’s still difficult to quantify. But Big Data isn’t just an important topic for big companies. Where a service technician at a customer can check a system and look at comparable system states in real time, it’s going to be much easier to make effective repairs. Where a retail company can see demand developing for every product at any time, rather than weekly or monthly, because all data from the point of sale is analyzed immediately, the shelves can be filled, the warehouse can be stocked, and the supply chain can be honed optimally and over the long term. Where complex material requirements planning is available within a matter of minutes rather than after 24 hours, requirements planning can be performed in a much more needs-based way. In all such cases, the time-to-value for SAP HANA is usually very fast. That’s why I think it will become an intrinsic part of many enterprise solutions, even beyond SAP. This will lead to the emergence of completely new business models.