Why do customers choose SAP cloud?
- Summary:
- We are now starting to see some solid SAP cloud customer case studies. In this article, we hit on three very different implementations, shared concerns and benefits expected.
At Sapphire Now 2013, the JD-OD.com team had a chance to shoot five customer cloud videos, mostly with Business ByDesign customers (see them all on our SAP cloud playlist). For some readers, 'SAP cloud' is probably an oxymoron. Doesn’t matter.
As it turns out, these customer stories had common cloud themes – and shared pain points. But first we should frame these use cases. In Orlando, we shot a video with SAP’s Rainer Zinow where he provided an update on ByDesign (still alive and well, despite being used as a perennial punching bag by SAP’s critics). Zinow also clears up some confusion about how ByDesign differs from Financials OnDemand (now SAP Cloud for Financials), while sharing almost all the same code base. If you want to dig into those product nuances, I’ve posted the Zinow video and writeup on JD-OD.com.
Zinow outlined several new use cases. For ByDesign, the formerly SME-focused product is moving upmarket through two channels: 1. ByDesign for subsidiaries of SAP Business Suite customers, and 2. Larger deals for professional services firms. The third use case is Cloud for Financials, a large enterprise product that is essentially the kernel of ByDesign financials with additional interfaces and enhancements bigger companies need. Cloud for Financials fits into SAP’s Line of Business SaaS product line as the “Money” component.
Thanks to the scheduling gods and the efforts of the SAP blogger program, we were able to get at least one video example of all three emerging use cases. I'll show you one of each in a minute.
As to the 'why cloud ERP?' question, common answers included:
- 'We aren’t an IT company' (or words to that effect)
- Quick rollouts required
- Disparate offices needed process standardization
- Migrating users off of rogue programs and spreadsheets
- Ability to start small and scale quickly
- Ideal for ambitious growth plans in new regions
- Compliance and global reporting requirements
- No CAPEX – start small and pay as you go
- Mobility: 'work anywhere from everywhere'
- Data integration across a suite
Bottom line? cloud ERP was perceived as having faster time to value. Beyond cloud, integration with the existing SAP investment was no small factor either. For the subsidiaries customers, that included the oft-mentioned advantage of integrating with the parent company’s SAP solution.
While these implementations weren’t without their change management obstacles, the go-lives were all in timeframes of months and not weeks. Not all results had been fully measured at the time of the shoots, but all customers planned to continue with cloud deployments. During these discussions (some of which occurred off camera as we were setting up), security fears were not dismissed lightly but were not seen as a reason to cling to on-premise options.
For a ByDesign for subsidiaries use case, check out the Hilti interview. They now have 8 subsidiaries live on ByDesign, mostly in Eastern Europe and the Middle East. By end of 2013, 20 subsidiaries should be live:
Show Notes
:41 Hilti’s presence in 120 countries worldwide created the need for ByDesign
2:32 Why ByDesign is the better solution for subsidiaries with smaller workforces
3:07 Rollout of ByDesign creates less pain than on-premise ERP
4:10 End-of-year goal: 20 subsidiaries and 1,000 users live with ByDesign
4:39 Except for what’s legally required, localization is avoided
5:15 Though hard to measure monetarily, key systems have undergone big (and positive) changes
6:05 Subsidiaries seeing the benefits of an integrated system
For a professional services ByDesign rollout, we have Roland Berger. As you’ll see, Roland Berger had the dreaded 'green font problem' – they needed a major upgrade of their resource management software. To be clear, Roland Berger has not gone live yet; they just completed their proof of concept. They plan to have offices in the first three countries live on ByD by this fall.
The Roland Berger story has interest from a software evaluation perspective. During the interview, Principal and CIO Daniel Gerster explains how they narrowed from 80(!) possible options to the selection of ByDesign, with cloud becoming a deciding criteria they were not initially emphasizing:
Show Notes
:48 Roland Berger is a strategy consulting firm: 2,700 employees in 36 countries and 51 offices
1:28 Company’s data stored in several systems; some software was 17 years old
2:44 SAP’s cloud solution was chosen from among some 80 competitors
4:10 ByDesign offered benefits that allowed the company to focus on what it does best
6:17 ByDesign distinguishes itself as the only really ready-to-use cloud solution
7:14 Rollout objective is for the first three countries to be productive this fall
Finally we have Aasonn, a recent Cloud for Financials customer. Allan Peterson, CEO of Aasonn, hits on cloud security, dishes on how they went live with multi-org, multi-currency and multi-country in three months, and explains why cloud integration matters when you are an “all cloud” company:
Show Notes
:39 Aasonn went all-cloud when starting up in 2006, and recently moved financials there
1:14 SAP’s commitment and product roadmap key to Aasonn’s cloud decision
1:51 Aasonn aimed for a pain-free integration, and got a good result
2:17 Native integration of other SAP cloud products was a big factor
2:58 Multi-org, multi-currency and multi-country was live in 3 months
3:59 Aasonn’s cloud pitch: 'Work anywhere from everywhere'
4:41 Cloud security almost always greater than on-premise security
Verdict
I don’t personally believe cloud ERP is right for every industry or use case. But these stories back up how cloud is impacting customers and disrupting vendors right and left. Even, you could argue, SAP itself.
One thing these videos didn’t hit on is customers building their own cloud apps. I don’t expect customers to always buy cloud apps out of the box; some are going to want to build. For an example of an SAP customer building on the HANA Cloud Platform (formerly NetWeaver Cloud), our fifth customer video hits on that issue. Cloud platform is an important topic for SAP and a story to watch as we head into TechEd season.
Disclosure: SAP paid most of Jon's travel and expenses to Sapphire Now 2013. SAP is a diginomica premier partner.