The fol­low­ing ASUG Part­ner Insight was authored by Dar­ren Shaw, North Amer­i­ca Vice Pres­i­dent of Mar­ket­ing at SNP Group. 

Anoth­er year, anoth­er SAP Sap­phire in sun­ny, hot, and humid Orlan­do, Flori­da. Same old, same old? In some ways, yes, but defin­i­tive­ly not in some very impor­tant areas.

Some things will nev­er change about Sap­phire: too many late nights, too many ses­sions to attend (and not enough time), so-so food, and lots of hype. There was, as always, an impres­sive line of keynote speak­ers (Jensen Huang, of NVIDIA, was par­tic­u­lar­ly inter­est­ing to lis­ten to). And it wouldn’t be a prop­er Sap­phire with­out a glimpse into SAP’s future as shared by SAP CEO Chris­t­ian Klein. 

He made it clear this year that arti­fi­cial intel­li­gence (AI) is the foun­da­tion of the prod­uct strat­e­gy going for­ward, promis­ing real busi­ness val­ue from Joule (and call­ing the gen­er­a­tive-AI copi­lot ​“ready for prime time”) while empha­siz­ing the capa­bil­i­ties of the AI Hub in SAP Busi­ness Tech­nol­o­gy Plat­form. Joule is the new front-end and user inter­face for all SAP appli­ca­tions, tout­ed as the ​“largest pro­duc­tiv­i­ty engine for users.” Accord­ing to Klein, over 27,000 are already using SAP’s Busi­ness AI. While this sounds like a large num­ber, it is less than 10% of SAP’s entire client base. Addi­tion­al­ly, ongo­ing AI inno­va­tions are only going to be avail­able to RISE and GROW cus­tomers in the cloud.

It is no sur­prise that near­ly every booth had the let­ters ​“A” and ​“I” side by side, some­times pref­aced by ​“Gen­er­a­tive” or ​“Busi­ness.” It is the buzz­word of the decade, and if you aren’t talk­ing about it in some form or fash­ion then you aren’t speak­ing with too many cus­tomers, because they all want to sep­a­rate fact from fic­tion when it comes to the require­ments and expect­ed out­comes of a suc­cess­ful AI strategy.

Clean Core, Bet­ter Data, and ​‘Less Tire-Kicking’

The hyper­scalers made impres­sive announce­ments at Sap­phire this year. Microsoft and SAP announced the expan­sion of their part­ner­ship by cre­at­ing a uni­fied expe­ri­ence with Joule and Copi­lot. SAP BTP, SAP HANA Cloud, and SAP Data­s­phere will run on AWS Gravi­ton proces­sors for bet­ter per­for­mance and ener­gy effi­cien­cy. Google Cloud said new mem­o­ry-opti­mized X4 instances will pro­vide the largest SAP-cer­ti­fied com­pute instances in the cloud mar­ket. These are all sig­nif­i­cant steps for­ward; the more com­plex AI solu­tions become, the more pro­cess­ing pow­er will be required, and that isn’t going to come from an inter­nal data center.

Of course, the ​“Clean Core” con­cept was reit­er­at­ed loud­ly and clear­ly, and SAP announced new tools and capa­bil­i­ties in sup­port of it. There are new low-code/pro-code tools in SAP Build and ABAP Cloud to min­i­mize cus­tomiza­tions, ABAP Devel­op­er capa­bil­i­ties in Joule for gen­er­a­tive AI-assist­ed ABAP cod­ing, and guid­ed work­flow tools in SAP Build Work Zone for automat­ing process­es with­out cus­tom code.

I men­tioned upfront that there were dis­tinct dif­fer­ences at Sap­phire this year. One of the key dif­fer­ences was far less tire-kick­ing. I can think of only one inci­dent where a per­son came to our booth and asked ​“So, what do you do?” Cus­tomers came to us with much clear­er end goals in mind, along with very spe­cif­ic chal­lenges that they knew would impede progress toward those goals.

Anoth­er not­ed dif­fer­ence was that, unlike in pri­or years where the focus was almost entire­ly on func­tion­al­i­ty, this year there were far more ques­tions (and con­cerns) about data. While the lev­el of true under­stand­ing about what AI is and what it can do varies great­ly, what appears to be com­mon­ly under­stood is that the adage ​“garbage in, garbage out” applies. Pri­or ana­lyt­ics and ​“big data” projects have left cus­tomers with big price tags and no ROI, and none of them want to be a part of the AI busi­ness case fail­ure per­cent­ages recent­ly high­light­ed by McK­in­sey and Har­vard Busi­ness Review. They know their data is in bad shape, and they know it is not just an SAP data prob­lem. They have data chal­lenges with­in a host of lega­cy appli­ca­tions that have to be dealt with before pour­ing mil­lions of dol­lars into gen­er­a­tive AI solutions.

Going About Trans­for­ma­tion the Right Way

A final dif­fer­ence was the acknowl­edg­ment that the clock is tick­ing. Can­did­ly, nobody had been con­cerned about the 2027 sup­port dead­line until recent­ly. The cus­tomers I spoke with at pre­vi­ous con­fer­ences believed that either SAP would even­tu­al­ly cave in and push the dead­line out, or that they would be fin­ished with their trans­for­ma­tion projects in time. Nei­ther has hap­pened. Project time­lines con­tin­ue to shift right while archa­ic approach­es remain long and risk-laden. SAP does not show any signs of blink­ing, but this lat­ter point isn’t the rea­son cus­tomers are grow­ing con­cerned about time. 

The real rea­son is FOMO (fear of miss­ing out). Ear­ly adopters of SAP S/4HANA and advanced busi­ness tech­nolo­gies who went about trans­for­ma­tion the right way are reap­ing the ben­e­fits in terms of high­er mar­gins. Com­pa­nies don’t want to wait two, three, four years, or more to dig­i­tize and opti­mize. Share­hold­ers aren’t that patient.

If there was or is any remain­ing con­fu­sion, it’s gen­er­al­ly focused on approach. We heard some of the same con­cerns as last year about what to do first, when, and how. SAP S/4HANA pre­req­ui­site projects, cloud moves, S/4HANA migra­tion, selec­tive data vs. all data, data har­mo­niza­tion, sys­tems con­sol­i­da­tion, archiv­ing, lega­cy sys­tem decom­mis­sion­ing, etc. There is still the belief that every­thing has to be done in a lin­ear, sequen­tial man­ner, and this is sim­ply not the case. 

Dur­ing Sap­phire, SNP offered proof point after proof point that the lega­cy SAP sup­port dead­line could become a non-issue with­in six to nine months, that all the afore­men­tioned activ­i­ties could be exe­cut­ed in a sin­gle go-live, and that the only lim­its to rapid trans­for­ma­tion and busi­ness ben­e­fit were those imposed by cul­tur­al imped­i­ments, not technology.

Ask five peo­ple their opin­ions about SAP imple­men­ta­tion and opti­miza­tion approach­es, and you’ll like­ly get sev­en respons­es. We know the nature of this indus­try all too well. Cus­tomers today are smarter, more dig­i­tal­ly savvy, intel­lec­tu­al­ly curi­ous, and dare I say prag­mat­ic. They exhib­it­ed these traits to my col­leagues and our SNP team in Orlan­do this year. This com­bi­na­tion of char­ac­ter­is­tics typ­i­cal­ly results in good con­ver­sa­tions and, more impor­tant­ly, rapid action.

Did you expe­ri­ence the same at Sap­phire 2024? Some­thing com­plete­ly dif­fer­ent? Let’s talk about it. Email me at darren.​shaw@​snpgroup.​com.

See you next year!

Dar­ren L. Shaw, North Amer­i­ca Vice Pres­i­dent of Marketing

SNP Group

This arti­cle was brought to you by SNP Group. ASUG devel­ops and pub­lish­es insights reg­u­lar­ly in part­ner­ship with its mem­bers and cus­tomers. For more infor­ma­tion on ASUG spon­sored con­tent, con­tact editorial@​asug.​com