Business as Unusual... with SAP? One book, eight enterprise megatrends - but should you read it?
- SAP's Thomas Saueressig and Peter Maier have authored a notable book on the trends enterprise customers must address. But does the book succeed in its editorial aims? Here's my opinionated review - and a look inside its creation.
I don't read business books often anymore - with the exception of some Audible titles on my various excursions. But a recent title from SAP Press, Business as Unusual with SAP: How Leaders Navigate Industry Megatrends, by SAP's Thomas Saueressig and Peter Maier, caught my eye.
Why? Well, for starters, I like a book with ambition. Attempting to cover off all the major trends in today's enterprise certainly fits that bill.
Then I got this note from analyst Vinnie Mirchandani, who was involved with this endeavor:
The key message is Business as Usual – circa 2019 – is a recipe for mediocrity. Evolve rapidly for a world turned upside down.
Yes, that's jugular enough. But if you're like me, a book like this raises burning questions. If only you could pursue those questions with the authors. In this case, I can. I've talked with Saueressig, Member of the Executive Board of SAP SE for SAP Product Engineering, on multiple occasions. Our dialogue has informed my SAP reporting/analysis, as in: Back to the SAP S/4HANA public cloud debate - an opinionated take on SAP's direction.
Business as Unusual - answering reader questions
Meanwhile, Mirchandani and I have been debating enterprise topics - as pesky analysts are prone to do - even before diginomica. So, I'm in a position to press the issue, and give readers answer to questions like these:
- What are the megatrends? Given the monster hype around generative AI, why wasn't AI one of them?
- Is the book just for SAP customers - or could other readers gain from it?
- How can leaders with packed calendars navigate this book and apply it?
- Is this book effective in getting across SAP's product relevance - or is it over-branded?
For a view on how the book came together, this video interview with Mirchandani and Tilman Goettke of SAP., is a good place to start. Goettke, who was the project lead, explains that publishing a book that went industry-to-industry wouldn't be a very compelling format. So, Goettke's team seized upon the "megatrends" format instead. What megatrends were selected? Via the book:
- Everything as a Service - the trend toward developing new business models by moving from making and selling products to delivering product outcomes as a service.
- Integrated Mobility - mobility that is convenient, safe, and sustainable in urban environments and across continents requires new concepts, business models, and digital technologies.
- New Customer Pathways - goes beyond a sales transaction and looks at the full customer lifecycle.
- Lifelong Health - an increasingly common concept, as smart watches with more sensors than the average intensive-care unit form the visible peak of an emerging health and lifestyle system iceberg.
- The Future of Capital and Risk - fintech and insurtech innovators challenge incumbents in the banking and insurance industries by leveraging innovative digital products and services.
- Sustainable Energy - finite fossil fuel resources and climate change are good reasons to accelerate the transition to decentralized and renewable energy.
- Circular Economy - looks at managing resources within our planetary limits. This perspective changes product design and lifecycle management.
- Resilient Supply Networks - keeping supply chains lean while making them resilient requires new approaches to combine supply chain transparency with intelligent planning.
I truncated these from the book; you'll want to check the full versions. And how were these megatrends selected? During the video chat, Goettke said the co-authors:
Talk to customers, partners, and analysts every day. They are really living and breathing working with customers, understanding what what they need, where the industry is; where their business is going. Those conversations are focusing on the core business of our customers in the industries, and on SAP and our ecosystem... So we thought that compiling all those experiences and interactions, in a book that you can take away is a great idea.
Megatrends - only relevant in an industry context
Five years ago, I used to warn customers that software vendors were pushing "transformation" to sell software. But the world has changed. Now, transformation is driven by customer imperatives. Customers might not necessarily use the "T" word, but they are taking action. However, the pressures and opportunities of each industry are different. That's exactly what Business as Unusual wanted to capture. As Goettke says, "We thought we would take a look at the forces that are behind the transformation for our customers' business in their industries."
The biggest mistake a book on "enterprise megatrends" can make? Being too generic and generalized. But as Goettke says, the focus of the book was always on industries:
Of course, every industry is exposed to a range of big trends. But the impact on how the trends are relevant for the business of our customers is pretty industry-specific... One of the big findings: no company and no industry is working and living in isolation; they're living in an ecosystem along value chains. That's how they are exposed to those trends, and that's how they get influenced.
If SAP leaders authored a "megatrends" book without customer proof points, it would come off as an exercise in pontification. Instead, the authors took a different approach, and that's where Mirchandani and his editorial and research team fit in. As Mirchandani explained to me:
My role was to bring out the story teller in over a 100 SAP, customer, partner executives and specialist analysts profiled in the book. You know I like lots of use cases and expert voices in books. The big difference for BAU (Business as Unusual) was the vast majority was sourced by SAP.
So, having a front row seat listening to all these domain experts talk about everything from the emerging hydrogen economy to servitization to molecular recycling to personalized medicine and more was definitely a highlight of the project.
2,500 pages of transcripts, slides and research materials turned into the SAP Press final - where you can get fortunately get the content in 300 pages. I asked Mirchandani:
"Business as Unusual" is not a title I would have expected from SAP. What do you think SAP is trying to get across here? He responded:
In the last few years, we have had one "Black Swan" event after another. Unlike in the past, these were not paced decades apart, but have come in rapid succession. Climate change urgency, COVID, energy crisis post-Ukraine, big digital transformations among them.
These shocks have led to so many new business processes and related application opportunities in every industry – curbside pickup and last mile delivery in retail, micro-fulfilment and related bot technology in logistics, telemedicine in healthcare etc. etc. Industries are blurring – pharmacies and retailers as healthcare clinics, product companies selling services in outcome based contracts. These are major shifts.
It's not just customers that have to shift - SAP does as well. Mirchandani continued:
Of course you need traditional GL, MRP and payroll functionality but they are no longer enough. SAP will continue to sell those, but in addition is developing e-mobility, gene and cell therapy, intelligent returns and more contemporary applications as cloud modules.
Validating with SAP customer stories
Mirchandani doesn't think that customers are underestimating these trends. But he does think some vendors are behind the times:
There is a nice heatmap at the start of the book – figure 1.2 – which maps the 8 megatrends to various industries. Not sure the industries with high exposure in that chart are underestimating their specific trends. In contrast, I find many vendors are still trying to sell circa 2019 functionality and services to those industries which do not adequately reflect many of the unique, newer vertical practices.
Given that SAP customers are featured throughout the book, is there a standout example or two that stuck with Mirchandani?
In terms of customers, when you listen to Aldo Noseda of Eastman talk about molecular recycling, when you see Shell in Figure 7.6 cover renewables, hydrogen, biofuels, carbon capture, when you hear Anthony Watson compare architectures at Nike where he was CIO to that at the clearing bank, Bank of London where he is CEO. you want to yell out loud "Toto, we are not in Kansas anymore."
If I had to pick one anecdote, it would be from the sustainability megatrend - about why sustainability and circularity are not just compliance driven. This story comes via the US Environment Protection Agency, touring the Ford plant at the start of the Flint, Michigan, water contamination crisis:
One of the solutions was importing millions of plastic water bottles to get people fresh drinking water without lead and legionella contamination. Estimates show that anywhere from 31 to 100 million bottles were generated as waste in the first three weeks alone. This could have led to a massive local waste problem, but local companies stepped in to create new products from this wastestream such as eyeglasses, clothing, and even automobile parts.
This example has a real world edginess to it, while retaining the ingenuity we need, if we want to capitalize on new business models. There's no reason we can't do that, while serving our communities better than we have in the past.
Anyone who thinks SAP is still caught up in an old school, ERP "back office" cul de sac will find a strong rebuttal in this book. But then, I've felt for a while that SAP's current executive board, including Saueressig, is quite forward-thinking - my question has always been how that translates into modernized products, while serving customers on older releases as well. Business as Unusual excels at showing how SAP's own customers are pushing SAP software beyond what you'd expect. Those are the projects SAP wants to be in the middle of - if SAP wants a seat at its customers' business transformation table going forward.
Is this book relevant to non-SAP readers? I'd say yes - there is nothing SAP-specific about these inescapable trends. Yes, there is a good amount of SAP product presence in these pages, but when you serve up a substantial offering like this one, you can get away with a bit of promotional product language here and there.
I credit the authors for keeping the real world context front and center, including the impact of the war in Ukraine. That type of globalist view is, I believe, SAP's greatest strength and most appealing quality, in a world too often mired in nationalistic navel-gazing. That refreshing big picture thinking is a major reason why I'd recommend this book to non-SAP audiences, despite some SAP product jargon.
I thought it was notable that Artificial Intelligence - certainly the biggest tech story of the year so far - did not get cited as a megatrend. However, applying AI is weaved into the book's use cases, so the authors certainly aren't ignoring next-gen technology. However, Business as Unusual's focus on customer results keeps the tech hype in check. There are about 25 mentions of AI, but mercifully, only three mentions of the Metaverse. Blockchain gets about ten mentions, but most of those mentions are still about pilot projects. That shows us this book is about portraying customers' current needs accurately, rather than pushing tech for its own sake, the way so many firms have shamelessly done with over-the-top Metaverse hype festivals.
For readers who aren't up for a 300 page read amidst 2023 deadlines, you can definitely approach this book more selectively. Check the overview, then cherry-pick the most relevant trends. SAP should look to get this book in as many hands as possible. For that reason, I hope they have plans to eventually issue a lower-priced e-book/Kindle version. SAP Press does offer this as an e-book, but the pricing is similar to a hands-on tech book. I would not have gone that route.
However, SAP may well have plans to follow this up with other book promotions. In the meantime, Mirchandani has certainly done his part to make the book's concepts accessible:
If you want a Reader's Digest version of the text for each megatrend and a YouTube Shorts version of the many interviews we recorded, read the blogs I am running on Deal Architect. The updated index as blogs are posted is at https://florence20.typepad.com/renaissance/2022/12/sap-business-as-unusual-blog-posts.html. This will allow a reader to read about 10% of the final copy and watch about 5% of the conversations we recorded for each megatrend. Hopefully that will give a lot bigger audience a taste for the content and convince them to read the whole book.
Mirchandani believes if enterprises want to make good on these megatrends, they need to push through the "doom and gloom." As a grouchy creator who sees creative power in skepticism, disappointment, and even genuine frustration at the status quo, Mirchandani and I have always had our differences over the need for optimism to solve problems. That said, he made a good position statement to me:
There is so much doom and gloom in the world right with health, energy, financial crises. We have forgotten that in spite of all the negativity there is a group of entrepreneurs and innovators which are driving tremendous change... I like to cite Albert Camus "' In the depths of winter, I finally learned that within me there lay an invincible summer" – this book shows plenty of sunshine in all the dark mood around us.
Fair enough... I'm not going to quarrel with sunshine - or Albert Camus.