A major focus of the 2018 SAPPHIRE NOW event in Orlando has been on SAP expanding its “digital innovation solutions.” But what does that really mean? And how can customers take advantage of these solutions?
Design-Led Innovation
Though SAP Leonardo was not as hot a topic at SAPPHIRE NOW this year as when it launched in 2017, it really is a good example of an SAP digital innovation solution. And as a solution, it continues to mature since it was introduced last year.
When we talk about design-led engagement services, we are describing what SAP originally called SAP Leonardo’s industry accelerators. These are best-practice tools designed to help develop and launch industry-specific enterprise software deployments.
The Kit is the New Accelerator
At this year’s SAPPHIRE NOW, SAP reintroduced its industry accelerators as industry innovation kits. The purpose behind this change appears to be to clear up some confusion. SAP wants to draw a line between the initial industry prototype projects (typically co-produced with an early adopter SAP customer) and the subsequent model for machine learning, the Internet of Things (IoT), or other innovation that SAP is building for customers in that industry.
These industry innovation kits are the next evolution of what SAP has learned so far from its SAP Leonardo projects. For example, SAP used its work with Costco Wholesale to reduce bakery waste using machine learning as a prototype. Then it created an industry innovation kit with a built-in machine learning model that other retailers can apply and adapt to their needs to solve common industry challenges. By following a previously successful implementation as a model, these kits help customers create data and application scenarios faster and with greater accuracy.
That’s the fundamental difference between the accelerators and the kits—the accelerators were the prototype projects and the industry innovation kits are the templates that have come out of these projects for related companies to use.
Defining the Toolkit
SAP defines the industry innovation kits within SAP Leonardo as, “Tools and materials for specific industries and business functions that can be tailored for each customer in a fixed-time, fixed-scope enablement process. The industry innovation kits are pre-integrated capabilities designed to accelerate solving critical industry problems.”
“If you want a more ground-level definition, think about industry innovation kits as insight that we have identified by analyzing a typical business problem that is common to similar firms across the same vertical or company type,” said Jayne Landry, Global VP for Solution Management at SAP Leonardo, speaking exclusively to ASUG during SAPPHIRE NOW.
Where the Innovation Kits Come From
SAP develops each of its industry innovation kits by engaging its customers in a design thinking strategy. “Design thinking as a methodology has been proven to significantly increase the success rate of a strategy or innovation project,” Landry said. “So, we start with that approach to help customers with the problem that they are solving.”
“As we apply the advantages of SAP industry innovation kits to a new customer scenario, we are also able to tweak and tune various KPIs and metrics to suit the particular use case at hand. If the customer goes ahead after their proof of concept (PoC) stage, then we replace the test data (which is SAP-generated anonymized data) with their own data,” added Landry.
What Tools Are in the Kits?
Speaking to various SAP executives during SAPPHIRE NOW 2018, it became clear that there are many functions included inside each kit. This is perhaps why SAP calls them “tools” and why SAP has settled on the word “kit” to describe these offerings.
SAP Leonardo industry innovation kit tools include predefined elements of software processing logic based on learnings from other SAP customers, delivered as:
- Defined computing channels to make API calls for an appropriate level of data analytics (in this case on SAP HANA)
- Templates to create extensions to services like blockchain at the appropriate point
- Connections to the Internet of Things (IoT) and other platform paradigms
- Software intelligence designed to help firms monetize their own data once it’s used in working production environments.
New Kits For 2018
As of now, SAP Leonardo offers 23 industry innovation kits (including five launched at SAPPHIRE NOW) that span more than 12 industry areas, including consumer products, life sciences, manufacturing, automotive, utilities, oil and gas, and sports and entertainment. SAP explains that the industry innovation kits have helped customers understand how SAP Leonardo is relevant to their business by addressing critical industry challenges and delivering faster innovation with less risk.
New kits announced this June 2018 include SAP Leonardo for Retail. This kit was highlighted at this year's SAPPHIRE NOW keynote on how Costco applied machine learning to help optimize productivity and reduce waste, saving more than $22 million in the first year of the project. Other new kits include SAP Leonardo for Automotive (fleet insights option), SAP Leonardo for Discrete Manufacturing (pay-for-outcome option), SAP Leonardo for Life Sciences (cold chain option), and SAP Leonardo for Consumer Products (cold chain option). Additional solutions address business process innovations that are flexible enough to work across multiple industries, including supply chain and logistics, digital customer engagement, sales forecasting, and cognitive controlling.
What Can Customers Innovate Next?
Though not all of us are software engineers, we can benefit from understanding how these innovation kits could work at our own organizations. Could they help us accelerate those innovation projects that have been sitting on the back burner for now? While SAP Leonardo is making strides by establishing industry models that are more accessible to customers, will that be what it takes to push their innovation projects forward? We will be curious to see.
Find out what happened on day one, day two, and day three in our 2018 SAPPHIRE NOW and ASUG Annual Conference coverage. Or read a recap of Dr. Hasso’s keynote.
You can also brush up on your understanding of SAP Leonardo by watching ASUG's webcast series at your own pace.