November 8, 2018

Harness your SAP system to the core of your Intelligent Enterprise

Auli Peltola

Head of SAP Application Lifecycle Management, Application Services, Tieto

Experiences from the SAP Experience Centre.

Is AI a threat or a possibility? Spinning Jenny once revolutionized the textile industry and we are now witnessing a similar transformation as AI and robotics advance with giant leaps. During the industrial revolution, people feared that jobs would run out, just like they do today. But products became readily available for more and more people, demand grew and completely new jobs and industries were born.

The ongoing technology transformation has been coined the fourth industrial revolution and the era of intelligence. What does this transformation mean to companies running on SAP? How can you harness the system to serve your business in a changing world?

Software at the core of strategy

SAP has opened a Nordic Experience Center in Copenhagen. We had the opportunity of visiting it with Norwegian, Swedish and Finnish user groups.

Before the much awaited Hands-on part of the visit, Jesper Schleimann, CTO SAP EMEA North, gave a presentation on “How to become an Intelligent Enterprise?” The title sounded very familiar to an old BI consultant, but the contents of Intelligence had risen to a completely new level.

Software is already at the core of the strategy of many traditional companies, regardless of their industry. Business is moving towards demand sensing, automonous pull economy, where customers pay based on outcome , such as compressed air or a hole in the wall.

SAP with its own algorithms is amongst the three largest companies globally in machine learning, and by 2020 its goal is to automate 60 % of work conducted in workplaces, while the general forecast is to achieve this by 2025.

A few facts were surprising. 77 % of the world’s transaction revenue is in SAP systems and SAP is used in 25 industries. SAP also holds the world’s largest business network; this doubtless refers to Ariba. Taking this scale into consideration SAP has genuinely managed to recreate itself.

More genuine options

Clearly over half of SAP’s turnover comes from cloud products. This probably includes SAP’s infraservice SAP HANA Enterprise Cloud, but nevertheless the share is significant. S/4HANA is now available as a localized SaaS solution. Juhani Sysimetsä opens this up further in his own blog.

SAP’s most significant new launch and answer to competition is C/4HANA. It is a packaged collection of both SAP’s own CRM products and also newer (Core systems) and older (Hybris) acquisitions. For customers this means more genuine options, as SAP is seriously investing into developing this area with its strong native integrations and master data management, also taking into consideration the strong core, i.e. S/4HANA.

C/4HANA portfolio combined with an indirect, i.e. digital usage licensing costs in case of 3rd party product, SAP has good potential for growth in customer experience.

Innovation with and without Lego blocks                    

As we were in Denmark, we also got a chance to play with Lego blocks. Without giving too much of the plot away, I can reveal that the demonstrations had to do with IoT and its different kinds of sensors and business applications, as well as machine learning with SAP Leonardo.

Many of us were quickly inspired by the examples and started thinking about how to apply the technology for our own business needs. It is worthwhile to start using SAP Cloud Platform and Leonardo, and also learn a Design Thinking approach to innovation culture already now, even if your S/4HANA transformation is not due for several years.

Culture and new competence are not developed fast and moving and renewing tailored solutions from the "core” to the cloud takes time as well. You can read more about this topic in Jouko Juuti’s blog.

Innovation services from a shipping container and a partner

SAP offers innovation services in various forms, such as SAP Mobile Innovation Lab, in which a transportable shipping container is brought to the customer to accelerate development. If the idea is sufficiently novel and different, SAP may facilitate the venture without separate cost.

Tieto also offers similar services. We have extensive experience in all areas of digital services, we are close to our Nordic clients, and we have strong industry knowledge.

If you are interested in visiting the SAP Experience Center, you can make contact for example here or through your own SAP customer account manager. I recommend it!

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