SAP Business ByDesign and the journey to HANA

Phil Wainewright Profile picture for user pwainewright December 15, 2014
Rainer Zinow of SAP tells me its cloud-native ERP platform, Business ByDesign, is maturing as it ports to the HANA database and builds an add-on ecosystem

Businessman looking at 3d road that goes up in the sky
One of the distinctive characteristics of cloud-native SaaS vendors is their ability to support continuous upgrades. By achieving a separation between the various layers of their architecture, they are able to upgrade the functionality or underlying infrastructure while 'in flight', taking as little as a few hours or even minutes in some cases. There's no need for the highly disruptive re-installation and testing process associated with conventional on-premise software upgrades.

When done well, it's possible to support extensions by customers and partners that continue to work without modification, and even to cary out a complete reengineering of the underlying infrastructure without anyone skipping a beat.

That's the journey SAP Business ByDesign is undertaking right now — porting from its original MaxDB database platform to HANA, while continuing to support extensions that partners and customers have added on top of the cloud ERP application. While new customers go straight onto the HANA platform, existing customers are moved a handful at a time, based on when the underlying hardware in SAP's datacenter is due for an upgrade.

The impact on customers should be "exactly zero", said Rainer Zinow, senior VP of SAP Cloud, when we met recently.

I have to be able to change the underlying architecture but I'm not allowed to disrupt my customers' operations.

In April, I migrated twenty customers without even telling them. We had to do it without add-ons being affected. We found a way even around that one.

Neither the customers nor the partners have to do anything to be compliant with the HANA world.

Growing extensibility

The ability to support customer and partner extensions through this upgrade process is one that predates HANA. It is a product of ByDesign's "honeycomb" architecture, Zinow told me, in which the application is composed of 35 separate sets of business logic. A developer can create additional honeycombs to add their own custom business logic.

The unique thing about the ByDesign architecture is that the integration is not done by shared database tables but only via the message bus. Therefore a partner add-on behaves exactly like all the other components built by SAP. We upgrade the whole chunk as one.

There are now over a thousand separate third-party add-ons running on the ByDesign platform, including some developed by partners that are being used multi-tenant by several customers at the same time. That demonstrates an important maturing of the product, said Zinow.

One of the reasons ByDesign had it tough [during] the first years was because the extensibility was not where it should be.

The ability [now] to extend the solution and integrate with non-SAP solutions is not the exception, it is the rule.

Many partners are adding industry-specific capabilities, ranging from revenue recognition for the software industry to plant maintenance, oil & gas, and pharmaceuticals.

Zinow likened the product's maturity to the 1998 release of SAP's flagship client-server ERP product R/3, which first launched in 1992.

ByDesign you could argue is roughly around R/3 4.0. It's a business suite with deployment to mobile and cloud.

One feature that is well liked by customers is the 'work inbox' which notifies the individual user of actions waiting to be completed. The inbox can be tailored to specific roles out of ninety separate 'work centers' built into the product, and then configured with specific alert triggers, such as stock, cash or order levels.

Customers tell me the one single most useful piece of technology that we put into ByDesign is the work inbox. The work will find you, you don't have to hunt it down.

The built-in analytics are also rated, he said, both for the ease of building new views, as well as the ability to drill down into the underlying data or workflows.

We wanted to get rid of the divide between analytical systems and transactional systems.

[Customers] like the business transparency that the system brings to the table.

Native on HANA

Rainer Zinow SAP
Rainer Zinow, SAP

ByDesign was the first of SAP's portfolio of SaaS products to begin the move to HANA.

We will be the first ones who run natively on HANA without any fallback whatever.

It turned out to be a lot easier than expected, said Zinow, and the first set of customers completed the move in February.

Porting to the new platform is only the first step in a multi-stage journey, however. The real benefits will come when the ByDesign team rearchitects the platform to take advantage of specific capabilities built into HANA. Moving certain operations out of the application server down to HANA will bypass performance bottlenecks and speed response times, explained Zinow.

HANA is not only a database, it also comes with a lot of built-in engines. If you do scaleout tests in ByDesign, the real bottleneck is how fast can you move memory blocks from main memory into the processor cache and back.

In the old world we'd send lots of select statements and bring the data back. In the new world I will take the code that I need to process the P&L statement and push it from the application server down to the database server and make sure that this logic gets executed on the database server. Only the result set will be moved back to the application server.

The more I can use these native HANA capabilities, the faster I can make the system. Yes it's more expensive, but if I process it down there it's substantially faster.

So for example, transferring OLAP processing from the application server down to the HANA calculation engine will speed up analytics. But the work to complete all of these changes will take a while, said Zinow.

I am not doing this yet, it will take us three years to do all of this.

My take

This is the second post from my recent interview with Zinow. The first looked at some of the use cases emerging in the customer base.

I'm not enough of a SAP expert to pass verdict on the comparison to R/3 4.0 but as a SaaS expert I can agree that ByDesign now ticks the boxes as a cloud-native SaaS platform.

As Vinnie Mirchandani noted in a comment to last week's post, it's unfortunate SAP couldn't have brought ByDesign up to this point three to five years ago. But that ignores the history of the platform, which was not even originally conceived as a cloud application. To adapt an apocryphal saying, SAP has ended up doing the right thing, but needed to exhaust all the alternatives first.

Meanwhile, the development of external add-ons is a process that takes time — look how long it has taken Salesforce to build up its AppExchange ecosystem.

SAP still faces a massive challenge in convincing the wider market that ByDesign is now worth a look as a cloud ERP contender. But it already has an advantage in selling into two-tier ERP opportunities, of which there are many thousands in SAP's own customer base.

So it looks as though ByDesign is now in a good position to increase its market presence. How far it can progress depends a lot on SAP's ability to take it to market persuasively, both directly and working with partners.

Disclosure: SAP and Salesforce are diginomica premier partners.

Image credit: Man facing road © ra2 studio -; Rainer Zinow photo by SAP.

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