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SAP Smooth and Relaxed?

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Let me start off by saying I am really pleased I went to SapphireNow this year. I saw what I called the “dawn of intelligent applications” with Leonardo. I liked CEO Bill McDermott promising to do more for customers about toxic contract terms. I liked that the partner booths appeared much smaller than few Sapphires ago – books have been written about the massive and expensive ecosystem around SAPSmile

But I am not sure customers want SAP to be “smooth and relaxed” as Dennis Howlett puts it after the recent earnings call. From a customer point of view there are areas where SAP should chill, others where it needs to be more assertive.

a) Be nice if SAP accepts that S/4HANA adoption in the incumbent customer base will be nice and gradual, as the product functionality incrementally evolves and the product becomes more stable. In volume 2 of SAP Nation, I presented the industry track record on next-gen products – at Oracle, J.D. Edwards, Infor, Microsoft and even at SAP with NetWeaver and I concluded:

a next-gen product takes years of development and maturation. Migrating a legacy customer base takes even longer. Those are just the laws of physics. SAP may be able to bend these laws slightly with S/4, but will likely not be able to break them.

So, personally, I have had modest expectations of S/4. SAP , or at least its marketing, does not agree and they claim it is “the fastest adopted product in SAP history (and) is available for all industries” Much of the adoption has been with smaller new customers. Existing customers are feeling the pressure to migrate when they find incumbent technology pretty stable and the migration costs, like a re-implementation, hefty. I would rather SAP savor S/4 progress like Charles Phillips, CEO of Infor commented about cloud adoption in his customer base in response to my note “If you hadn’t heard the 90,000 (total customer count) number, by any measure you consider over 8,000 individual companies (in the cloud) in 3 years a success.” S/4 is breakthrough in-memory, next-gen UX product. SAP has done well with sales so far. They should relish the progress not overhype its scope or coerce adoption within incumbent customers.

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