16 questions SAP needs to answer for its American audience

16 questions SAP needs to answer for its American audience Den Howlett Fri, 11/06/2020 - 03:12

Summary:
The leaders of SAP and ASUG are holding a conversation which will help clarify SAP’s position in the Americas.

Christian Klein, CEO SAP a

nd Geoff Scott, CEO ASUG (via SAP and ASUG)

On Thursday, Nov. 12 at 12:30 p.m. ET/11:30 a.m. CT, Geoff Scott, ASUG’s CEO and Christian Klein, SAP’s CEO will hold an hour-long conversation to discuss topics of interest to that market. The event is open to non-ASUG members and, in my opinion, represents a golden opportunity for SAP customers and potential customers to get answers to their most pressing issues. As I said on Twitter, my interactions to date with Klein suggest that he will answer all and any questions, and where he doesn’t have a good answer, will ensure follow up. This is what we like to see in leadership. We encourage any customer or potential buyer to sign up for this important event.  Regular readers will know that ASUG is a premier partner with diginomica so it won’t surprise anyone to know that we have regular conversations with ASUG, trading information with a view to helping readers better understand the often complex SAP landscape. In our most recent conversation, which followed the Q3 FY2020 earnings call, we found significant common ground with almost no disagreement on our observations regarding the American market. In the call to action for the upcoming conversation, ASUG telegraphed the direction it plans to take as follows:

The current state of the customer mindset in North America (cost pressures, uncertainty with COVID-19, prioritization of key projects, etc.) SAP’s strategy and how it will help customers achieve business outcomes Why SAP remains a key technology partner for North American customers Christian’s vision for SAP in 2–5 years Where customers should devote their time and attention to SAP’s product portfolio and why 

None of this should be a surprise but as to specifics, the following are the kinds of question customers should actively consider. It is unrealistic to shoehorn many of these into an hour-long call and while they are all relevant, customers will have their own agendas. This, therefore, represents a broad compilation based on what we hear in the market both more generally and as it impacts the Americas. 

You’ve made clear that customers interests are your first priority. How does that translate into an overarching strategy narrative into which customers can buy for the long term. What does that narrative look like in light of the pandemic? Give us the TL;DR.  What exactly does a push back in ambition to 2025 mean for product? It’s been consistently difficult to build the S/4 project business case. That continues to be true in all geographies and it now seems SAP has conceded that its immediate future lies in smaller, more focused projects as indicated by Adaire Fox-Martin during the earnings call. What types of project should customers prioritize and what SAP solutions fit into that story? How will SAP encourage customers to focus especially given that the traditional SAP sales teams approached emphasizes large, complex deals? How will SAP make it simple and quick to go through the buying process? Time to value is top of mind. Can you give us some examples of how SAP is helping customers accelerate this element of their relationship with SAP such that value based outcomes are both clear and demonstrable?  A central part of time to value is implementation cost. ASUG has reported that customers are still typically looking at 10x. This is no longer acceptable (if it ever was) so how is SAP helping customers keep their implementation costs under control? You’ve said that the future is cloud but what does this mean beyond taking products SAP has acquired? Does it for example mean we can expect a cloud native version of S/4 and if so then what is the timeframe for this to become available? Given the revised ambition through 2025, does this mean we can expect an extension to the end of support for ECC beyond 2027 as that would seem logical given the typical project timeframes we see among customers? SAP’s position regarding the hyperscalers isn’t always clear. You’ve said SAP deserves a seat at the table? Why when customers have already chosen multiple hyperscaler suppliers? What does SAP bring to the party that materially helps customers in their cloud/digital journey? Bob Stutz has publicly said the enterprise software industry needs a modern model of consumption based pricing and asks why customers should pay at the point of contract rather than at the point of outcome. What does this mean for price and/or terms relief SAP can now offer customers? Thinking about consumption based pricing models, you will have seen the case studies involving indirect access and reports that SAP struggles to accurately measure document numbers. What is being done to resolve that issue and when will this work be complete? You’ve talked at length about integration but have been relatively quiet on that front this year. What update can you offer? You’ve said that partners are vital to the company’s and its customers' future. How will you position partners in the sales cycle going forward? Will you offer customers a selection of similar partners or stick to the SolEx portfolio? While we welcome industry specific initiatives, it seems SAP has a lot of ground to catch up. What industry-specific updates can you offer customers? Climate change is a passion for you but almost nobody we speak to cares about this topic. Why is it relevant and how do customers benefit? Where are the proof points that will persuade the C-suite that investing for this helps them today and into the future? You have talked about a partial IPO for Qualtrics and have exited mobile. What other products are being sunsetted or divested?

Does this list make sense? What additional questions would you emphasize? 

Disclosure - ASUG is a premier partner at the time of writing

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Author: Den Howlett

Date: 2020-11-06

URL: https://diginomica.com/16-questions-sap-needs-answer-its-american-audience

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