At the end of last year, SAP announced the addi­tion of three new indus­tries to its indus­try cloud. This offer­ing, which fits in along­side the SAP Intel­li­gent Suite in the SAP Intel­li­gent Enter­prise and inte­grates with all the appli­ca­tions in that suite, offers SAP cus­tomers hyper-spe­cif­ic solu­tions for indus­tries that will assist them in fur­ther expand­ing their busi­ness process­es. Many of the solu­tions are devel­oped by SAP part­ners using the SAP Cloud Platform. 

To date, SAP has announced sev­en indus­tries that are cur­rent­ly live in its indus­try cloud: auto­mo­tive, con­sumer prod­ucts, engi­neer­ing and con­struc­tion oper­a­tions, indus­tri­al machin­ery and com­po­nents, pro­fes­sion­al ser­vices, retail, and util­i­ties. Mov­ing for­ward, the indus­try cloud is going to be inte­gral to SAP S/4HANA and encour­ag­ing cus­tomers to imple­ment the ERP solution. 

ASUG recent­ly spoke with Peter Maier, pres­i­dent of indus­tries and cus­tomer advi­so­ry at SAP, about SAP’s indus­try cloud. He dis­cussed how SAP’s indus­try cloud ben­e­fits cus­tomers, how it is mak­ing use of intel­li­gent tech­nolo­gies like ML and AI, and what cus­tomers can expect to come in 2021. 

ASUG: Tell us about your cur­rent role at SAP and how your back­ground has helped you in work­ing with SAP’s indus­try cloud. 

Peter: I am the pres­i­dent of indus­tries and cus­tomer advi­so­ry at SAP, a role that was cre­at­ed a year ago to bring togeth­er the pre­sales, val­ue advi­so­ry, and indus­tries teams. In this role, I am respon­si­ble for the SAP busi­ness with our cus­tomers in their indus­tries, along with mak­ing SAP and part­ner prod­ucts rel­e­vant to them. The cus­tomer advi­so­ry group show­cas­es SAP solu­tions and con­sults SAP cus­tomers on real­iz­ing the busi­ness val­ue gen­er­at­ed by the SAP port­fo­lio. I joined SAP in 1991 as a con­sul­tant for the chem­i­cal indus­try. In 1995 I assumed respon­si­bil­i­ty for glob­al busi­ness devel­op­ment for the oil and gas indus­try. Then I had var­i­ous roles with­in the indus­tries orga­ni­za­tion — from gen­er­al man­ag­er of the ener­gy and nat­ur­al resources indus­tries to pres­i­dent of SAP Indus­tries. Start­ing three years ago, I began dri­ving a world­wide ini­tia­tive to sim­pli­fy our road maps and sup­port our cus­tomers in their dig­i­tal trans­for­ma­tion jour­neys. The indus­tries team’s knowl­edge and road maps task forces helped me get both the exper­tise and strat­e­gy to launch SAP’s indus­try cloud. 

ASUG: Can you pro­vide a high-lev­el overview of the indus­try cloud, why it was devel­oped, and how it ben­e­fits both cus­tomers and partners?

Peter: The design of SAP’s indus­try cloud reflects our cus­tomers’ core busi­ness needs with­in their respec­tive indus­tries. It enables us to estab­lish a set of solu­tions and busi­ness process­es rel­e­vant to each indus­try run­ning on the SAP Cloud Plat­form. The solu­tions extend the sup­port for end-to-end process­es with the SAP Intel­li­gent Suite, pro­vid­ing a com­pre­hen­sive busi­ness and tech­nol­o­gy plat­form for our customers.

Each solu­tion with­in SAP’s indus­try cloud port­fo­lio is indus­try-spe­cif­ic and involves key busi­ness oper­a­tions, such as mate­r­i­al man­age­ment, sup­ply chains, and finance or asset man­age­ment. More specif­i­cal­ly, SAP cus­tomers can devel­op or adopt new solu­tions for com­mon func­tions, such as cur­ren­cy con­ver­sion, sub­scrip­tion man­age­ment, billing, and oth­er ser­vices that cre­ate a sim­ple and uni­fied user experience. 

We devel­oped this indus­try cloud port­fo­lio because cus­tomers across every indus­try were feel­ing a sense of urgency as new mar­ket pres­sures and dig­i­tal tech­nolo­gies changed the way com­pa­nies do busi­ness. We cre­at­ed an open plat­form that empow­ers our cus­tomers to build and adopt ver­ti­cal inno­va­tions as part of their IT land­scape. In essence, SAP’s indus­try cloud gives our cus­tomers the tools they need to mod­ern­ize and cus­tomize their busi­ness operations.

ASUG: The plat­form has been tout­ed as the inno­va­tion space for SAP cus­tomers and part­ners to build solu­tions and appli­ca­tions that will com­ple­ment the SAP Intel­li­gent Suite using the SAP Busi­ness Tech­nol­o­gy Plat­form. Can you walk us through spe­cif­ic use cas­es of how that’s been done, how open source plays a role, and what the feed­back has been thus far?

Peter: The SAP Busi­ness Tech­nol­o­gy Plat­form is the foun­da­tion of the indus­try cloud. Our open busi­ness and tech­nol­o­gy plat­form has an open-API frame­work that pro­vides access to key enti­ties of the SAP Intel­li­gent Suite, unlock­ing oper­a­tional and busi­ness data to sup­port bet­ter deci­sion-mak­ing and dri­ve greater effi­cien­cies. SAP cus­tomers have not­ed that the indus­try cloud gives them the oppor­tu­ni­ty to mod­u­lar­ize their future enter­prise architecture.

One com­pa­ny that has already lever­aged SAP’s indus­try cloud is Hon­ey­well Forge, which teamed up with SAP to cre­ate a joint cloud-based solu­tion based on Hon­ey­well Forge’s enter­prise per­for­mance man­age­ment offer­ing and the SAP Cloud Plat­form. By pro­vid­ing real-time access to key met­rics and per­for­mance indi­ca­tors, the joint solu­tion avail­able through SAP Cloud for Real Estate helps build­ing own­ers opti­mize their oper­a­tions to achieve aggres­sive ener­gy sav­ings tar­gets and sub­stan­tial­ly reduce main­te­nance hours.

ASUG: What are some of the main ben­e­fits of SAP’s indus­try cloud? 

Peter: In the past year, we have passed some sig­nif­i­cant mile­stones as we work with cus­tomers to sup­port resilient and trans­par­ent busi­ness oper­a­tions. A lot of the resilien­cy and flex­i­bil­i­ty with SAP’s indus­try cloud stems from the abil­i­ty to lever­age best prac­tices and solu­tions from oth­er indus­tries, all with the goal of enhanc­ing busi­ness oper­a­tions. Rapid inno­va­tion can be fueled by bor­row­ing these best prac­tices and apply­ing them to exist­ing indus­try cloud solu­tions — or by cre­at­ing solu­tions using ML, ana­lyt­ics, and busi­ness networks.

The advan­tage of SAP’s indus­try cloud approach is that it pro­vides a space for tri­al and error. All dig­i­tal tech­nolo­gies of the SAP Busi­ness Tech­nol­o­gy Plat­form are avail­able — includ­ing Inter­net of Things (IoT), AI, ML, and blockchain — to dri­ve inno­va­tion at the ver­ti­cal edge. Com­pa­nies can apply these tools to exper­i­ment with new ideas that may like­ly fail or per­haps prompt an indus­try-chang­ing breakthrough.

ASUG: How has the indus­try cloud con­cept evolved since SAP first began to talk about it, and what lies ahead on the road map? What should cus­tomers and part­ners expect in 2021 and beyond?

Peter: It’s true that we’ve been talk­ing about the indus­try cloud on a reg­u­lar basis since 2014.

At the time, we named our indus­tries orga­ni­za­tion ​“indus­try cloud,” to sig­ni­fy our tran­si­tion to the cloud. We want­ed to guide our cus­tomers on their cloud jour­ney, and it also was a change for us. 

Today, cloud solu­tions are the nor­mal way of think­ing and oper­at­ing. So, ​“indus­try cloud” has a very dif­fer­ent mean­ing now: it’s the inno­va­tion space for SAP and our part­ners to devel­op new solu­tions for the core busi­ness of our cus­tomers. The indus­try cloud solu­tions are offered as a soft­ware ser­vice, includ­ing the rel­e­vant inte­gra­tion and con­fig­u­ra­tion con­tent to extend the SAP Intel­li­gent Suite and busi­ness net­works. In 2021 and beyond, we and our part­ners will expand the port­fo­lio of indus­try cloud solu­tions for many industries. 

ASUG: How does the indus­try cloud make use of tech­nol­o­gy like AI, ML, and IoT? What oth­er intel­li­gent tech­nolo­gies will be inte­grat­ed with­in the solutions?

Peter: Through SAP’s indus­try cloud, cus­tomers have instant access to a broad range of busi­ness and tech­nol­o­gy inno­va­tions that stream­line the devel­op­ment of solu­tions. From sim­ple busi­ness tools such as cur­ren­cy or unit con­ver­sion to lead­ing AI and ML libraries, these inno­va­tions can make busi­ness process­es smarter and more efficient. 

With AI and ML libraries, solu­tion design­ers can cre­ate con­ve­nient, yet excit­ing, user expe­ri­ences that span across mul­ti­ple indus­try cloud solu­tions, the SAP Intel­li­gent Suite, and busi­ness net­works. Beyond intel­li­gent tech­nolo­gies, cus­tomers have full access to the rest of the SAP Busi­ness Tech­nol­o­gy Plat­form port­fo­lio, which includes data man­age­ment, ana­lyt­ics, and appli­ca­tion devel­op­ment. All of these pow­er­ful capa­bil­i­ties make up the foun­da­tion of SAP’s indus­try cloud and ulti­mate­ly enable the devel­op­ment of end-to-end busi­ness processes.

ASUG: How does the SAP Indus­try 4.Now strat­e­gy align with the indus­try cloud?

Peter: Indus­try 4.Now is cru­cial to our over­all indus­try cloud strat­e­gy. Many indus­tries have been seek­ing greater coor­di­na­tion between the shop floor and the top floor. With Indus­try 4.Now and the indus­try cloud, SAP cus­tomers can trans­form their man­u­fac­tur­ing oper­a­tions, lead­ing to more intel­li­gent fac­to­ries and assets that will pro­vide faster and more accu­rate insights for end users and decision-makers. 

For indus­tries that are reliant on man­u­fac­tur­ing, Indus­try 4.Now will help con­nect pro­duc­tion to over­all busi­ness process­es defined by the indus­try cloud. The par­al­lel ini­tia­tives will have a direct impact on the man­u­fac­tur­ers of vehi­cles, indus­tri­al machin­ery, or build­ings. These solu­tions are all about our indi­vid­u­al­ized approach to every cus­tomer and industry.

ASUG: What are some of the lessons learned from 2020 that will affect the future road map of SAP’s indus­try cloud?

Peter: SAP made a com­pa­ny com­mit­ment at our Q3 earn­ings call to give our cus­tomers choice. As our CEO Chris­t­ian Klein shared with ASUG CEO Geoff Scott dur­ing their vir­tu­al con­ver­sa­tion in Novem­ber, many of our cus­tomers, such as those in the auto­mo­tive or the chem­i­cals indus­try, are fac­ing process com­plex­i­ty. Many of these com­pa­nies are using mul­ti­ple ERP sys­tems with­in their com­pa­ny and it’s com­plete­ly unre­al­is­tic to believe that they will go straight to the pub­lic cloud. We can take them to the cloud and then, as Klein said, ​“step-by-step, based on your busi­ness pri­or­i­ties, we are trans­form­ing your process­es, order-to-cash, procure-to-pay…it’s depend­ing on your busi­ness pri­or­i­ties and on our next-gen­er­a­tion busi­ness tech­nol­o­gy plat­form where you now find the data mod­els and the busi­ness ser­vices you need.”

The key les­son from 2020 is that we at SAP are meet­ing our cus­tomers where they are, under­stand­ing the mar­ket real­i­ties they are fac­ing as busi­ness­es, and enabling them to over­come these chal­lenges. For exam­ple, in spend man­age­ment — Pro­cure-to-Pay in our port­fo­lio — cus­tomers like Wool­worth are depend­ing on this solu­tion because they have to figure out which sup­pli­ers can still deliv­er dur­ing COVID-19. As Klein men­tioned, ​“we infuse AI into this process to reduce the trans­ac­tion­al work­load to enable cus­tomers, and of course our end users, to do more val­ue-adding tasks while automat­ing the trans­ac­tion­al activ­i­ties in this process. We gain pro­duc­tiv­i­ty of 40% com­pared to the way we run pro­cure-to-pay before in our old sys­tems, in our old lega­cy landscapes.”

ASUG: What would you like ASUG mem­bers to know about SAP’s indus­try cloud? 

Peter: Indus­tries have always been our strong suit. We have spent a lot of time with cus­tomers and part­ners to under­stand and address indus­try require­ments. To help them run their val­ue chains end-to-end, our cus­tomers want SAP soft­ware and tech­nol­o­gy to dri­ve more ver­ti­cal, indus­try-spe­cif­ic process­es in the cloud with seam­less inte­gra­tion into the back­bone — which in many cas­es are in core SAP applications.

SAP’s indus­try cloud deliv­ers inno­v­a­tive, ver­ti­cal solu­tions from SAP and our part­ners to trans­form busi­ness and dri­ve sus­tain­able growth. These solu­tions are built on the SAP Busi­ness Tech­nol­o­gy Plat­form with an open-API frame­work, open-process mod­el, open-domain mod­el, and busi­ness ser­vices. This helps ensure inter­op­er­abil­i­ty, rapid deploy­ment, and inte­gra­tion with the SAP Intel­li­gent Suite. AI, ML, IoT, and oth­er advanced tech­nolo­gies from our plat­form are avail­able to devel­op­ers to accel­er­ate inno­va­tion and deliv­er greater busi­ness value.

Our indus­try cloud solu­tions engage a broad range of part­ners to cre­ate solu­tions that com­ple­ment and build on our deep exper­tise in end-to-end process­es across indus­tries. Because in our dig­i­tal age, no com­pa­ny alone will be able to tack­le the chal­lenges and changes of today. It’s all about part­ner­ing and team­ing up on a glob­al scale. We will include tra­di­tion­al part­ners, in addi­tion to star­tups, uni­ver­si­ties, and more. Joint plan­ning means cus­tomers get the widest range of solu­tions avail­able to sup­port their unique indus­try requirements.

Con­tin­ue the con­ver­sa­tion about SAP Indus­try 4.Now with the Exec­u­tive Exchange Vir­tu­al Round­table: Expe­ri­ence SAP Indus­try 4.Now for Process Indus­try on Feb. 4, 1 p.m. ET/12 p.m. CT. ASUG is also start­ing 2021 off with a vari­ety of Think Tanks and inter­est group events. Check out the full sched­ule to register.