Last week I attended one of the SAP Insider events, the one that combines Financials (Financials2012), Governance, Risk and Compliance (GRC2012) and Human Resource Management (HR2012). I have to admit that HR was the odd man out here. I work with the GRC, financial applications and Enterprise Performance Management (EPM) teams at SAP, but I only watch the HCM space from the periphery. That may change over the next year if companies that are, from my perspective, largely “ERP vendors” continue to acquire and invest in this space. For those who have been living under a rock for the last few months, SAP recently acquired HCM solution provider SuccessFactors and Oracle acquired talent management vendor Taleo. Sanjay Poonen (@spoonen), President & Corporate Officer, SAP Global Solutions made an interesting comment about this acquisition in his opening keynote to all three groups. He said that SAP had “followed our customers, who voted through their wallets.” I believe he was referring to both HCM as well as movement to “the cloud.”
Sanjay kicked off the event highlighting a key concern of many business executives today: the difficulty in keeping up with the increasing volume, velocity and variety of data. Actually Sanjay referred to it as “Big Data” although I suspect that phrase has not completely infiltrated the vocabulary of most top executives… at least not yet. I think there is still an education process that needs to happen before many will understand they have a data problem.
There is no doubt that anyone running a business today understands that both the speed of business and the speed of change, hence the velocity continues to accelerate. Nobody would argue that customers are more empowered and connected and expect service instantly and this, together with continued globalization increases the volume of data required. But have top executives really come to understand that data required for planning and decision-making also expands beyond the traditional boundaries of data that is collected and stored in enterprise applications? Some have, but many, particularly those in smaller companies, have not. This is in part impacted by the “social business” movement. CFOs represent the largest target market for Financials and GRC and CFOs are not known to be the most “social” folks on the planet.
That said, even the increasing volume of traditional data might be enough to prompt action. This was the case for Harcourt Houghton Mifflin, highlighted in Sanjay’s keynote. The merger of the two companies resulted in 8 mini companies, disjointed data, fragmented processes. All of this was going on during a financial crisis. The goal was one version of the truth on an integrated platform to support integrated business planning. Of course the reason Harcourt Houghton Mifflin was featured in Sanjay’s opener was because their solution to this problem was SAP’s Business Planning and Consolidation (BPC) solution.
Harcourt Houghton Mifflin needed to get alignment among stakeholders. According to the video played, they were “looking for something easier to use than Hyperion.” They needed to transform the planning process and they feel EPM 10.0 changed the nature of the way people manage performance across finance and operations. The real power comes not from analytics as a separate tool but from embedding them directly into the applications wherever they are needed.
And therefore the one big announcement from SAP during the event serves to emphasize the convergence of these 3 V’s: volume, velocity and variety. The announcement was that BPC is now running on HANA, SAP’s answer to the “big data” problem. According to Sanjay, “The power of SAP HANA enables financial professionals to perform faster planning, query, reporting and analysis, profitability and simulation in real-time. As a result, SAP helps companies accelerate period-end closing and smarter decision-making — faster than other vendor offerings available today.” So the message transcends the annual planning, budgeting and forecasting exercise and applies equally to the ongoing financial consolidation and reporting exercise.
However, it is only the Netweaver version of BPC that is powered by HANA (there is also a Microsoft version) and for this to work, the customer needs to be running a version of BW on HANA. The reality is that the version of BW sitting on HANA is still in what SAP calls “ramp up” (i.e. early adopter or what other vendors might call beta testing). So customers interested in BPC on HANA either need to be in this ramp up program, or they need to wait until it is generally available. SAP is hoping that it will exit ramp up by Sapphire in May.
I am hoping to do a more in depth analysis on this once customers are running live. In the meantime, the education process around big data and data management strategies needs to continue. This is more than SAP just creating the need in the mind of their customers and prospects for the technology solution it has developed. This is a real problem for many CFOs today. Many simply don’t understand that technology has advanced to the point of providing a solution.