SAP stakeholders know the company has been coming to terms with a painful business transformation that impacts every area of the business over the last three years.
We're talking product (moving a 40 year legacy to cloud), management (moving from a co-CEO to a sole CEO structure), revenue model (perpetual licence to subscription), culture (tenure to meritocracy), customer relationships (combative to co-innovation) and everything in between.
By any standards it is a tough ask. So when Bill McDermott, CEO took to the stage and spent the best part of an hour talking simplification but making no product announcements and having the wind knocked out of his sails by the premature release of 'Fiori and Personas for free,' it was always going to be hard to convince the cognoscenti that this is the bold new SAP that Bill McDermott outlined.
We had to wait until day two to start seeing meat on the bone of that message with keynotes that included Clay Christensen - he of Innovators Dilemma fame - and the appearance of Hasso Plattner and Bernd Leukert to get a sense of what SAP means by simplification in the product line. Even then, we were largely left holding our breath as SAP concentrated upon a handful of knock out examples of HANA led innovation from the likes of Burberry, eBay, HP and ConAgra followed by a listing of strategic partnerships.
Sure, those partnerships were good to see: Intel, HP, VMWare and Red Hat are all great headline grabbers for the geek squad but why leave out Microsoft and the Azure relationship?
It was only as we met Rob Enslin, Bill Mc Dermott, Hasso Plattner and Bernd Leukert that a fuller picture emerged. I'll talk more about those conversations in a separate story but one thing was clear. This SAPPHIRE was not one aimed at validating the buzzwords upon which the media and analysts feed. Almost no big data, no internet of whatnot, no social business and only a smidgen of cloud beyond 'we are the cloud company' upon which to hang any commentary.
Instead, McDermott wanted to ensure that attendees understood several things and so he hammered at:
- This is a new SAP with a new management and leadership team determined to simplify EVERYTHING.
- Simplification is crucial for everyone's success.
- Accountability and transparency must run through the fabric of the company.
- Oh yes - have no doubt - everything on the product side is moving to the cloud because tomorrow's business is about a sustainable subscription business model.
Did he succeed? That depends on who you speak with. Some customers were delighted, in part I sense because the Fiori announcement released a level of pent up frustration that was due to boil over. But then customers also want timelines and roadmaps and those were conspicuously absent.
I was asked my assessment by every executive I met and many others.
In many senses it felt like an opportunity missed. With Fiori and Personas off the table as a grating and gating factor, SAP could have surprised everyone with 'one more thing.' Whether that was a commitment to solving OSS cost issues in the patch and upgrade cycle, more meat on the simplification of contracts or simply rounding out the otherwise excellent 'simplified accounts' demos with something around the business model that customers will need to understand, I could care less. But it didn't happen and in that sense, I felt that SAP lacked.
I will return to this in a later story but for now, what we can say is that SAP did not fall into the 'jam tomorrow' trap that has been so often laid down in years past. And for that, they should be commended.
Analysts were left gnashing their collective teeth and that's OK. McDermott has made clear that he wants to plow a different furrow. Not for him the hamming up of connected toothbrushes, multi-tenant rhetoric or the internet of everything (powered by HANA - of course.)
What's the problem?
As I said right at the top, SAP is tackling problems that (almost) no other software vendor has as it moves through the transformative process. It has a huge legacy in numerous areas. To expect McDermott to trot out a set of steps that tackle the major analyst talking points was probably too much to expect and while it may all seem easy on the outside, it is a very different matter when viewed from the inside. I know. I have personal experience of this.
So, even though I expressed the view of missed opportunity, it would be difficult to pinpoint one thing they could have said that would have had the blockbuster impact many of us anticipated without opening the door to many more questions.
In that sense, media and analysts will just have to suck it up.
The good news is that SAP gets another shot at this later in the year when it hosts the geek crowd at decode (aka TechEd.) We have to hope that by then, the company can answer some of the topic areas mentioned above and start paving the way for a vision that has clarity beyond the simple message put out by the CEO.