While there were product announcements at SAP’s annual conference, Sapphire Now, two major focuses were sustainability and supply chains, and the people and business processes operating behind the scenes.
“I’ve come to call COVID the great accelerator, and I think that the world was already moving pretty fast, pre-pandemic,” said SAP North America president DJ Paoni during a media roundtable. “I think it’s accelerated so many trends. First and foremost, a company’s culture, for example, I think was certainly important pre-pandemic. Now, you have to win the culture game.”
He explained that as companies come out of COVID lockdowns, employees will be thinking about their experiences and considering whether or not to stay with the firm.
“We’ve certainly seen an uptick with a focus on talent, and on employee well-being,” he said. “With our SuccessFactors suite of products, we had the best quarter, or the best Q1 ever, for SuccessFactors bookings here in North America.”
In fact, he said, SAP had its overall biggest cloud booking quarter in Q1 history in North America this year, with customers spending on digital transformation projects that may have been on hold in 2020.
Chief marketing and solutions officer and executive board member Julia White has only been with SAP for a few months but said that in her previous role as corporate vice-president of product marketing for Azure at Microsoft, she saw a lot of companies moving to the cloud by cobbling together quick and dirty solutions to automate processes or create new workflows.
“Which was fine, in kind of in a band-aid way, getting the journey started,” she said. “But that doesn’t fundamentally change your business processes. And I think now that the economy is starting to look better, we’re turning the corner and in North America, you’re seeing that now they’re like, ‘Okay, now let’s actually go work on modernizing, digitizing the business process layer, not just kind of wrapping it with different technologies’. That’s some of the strength we saw in Q1 and expect moving forward is getting to that core of the business process itself.”
From duct tape to strategic
Patrick Moorhead, founder, president, and principal analyst at Moor Insights and Strategy noted that he’s seen an evolution in company reactions during COVID from the initial survival stage.
“And they started, I call it post triage, where it’s like, ‘we’re gonna stay in business, but we need to put stronger duct tape on the system.’ But I feel like we are entering a zone right now – and I think this is geography dependent on where COVID is – that is getting more to strategic underpinnings, which, as opposed to using duct tape to keep everything together, it’s actually ‘Hey, let’s look at some of our fundamental systems here,'” he observed.
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Given that trend, he wondered in which strategic areas SAP is seeing customers re-engage.
The past 12–18 months have highlighted deficiencies in supply chains, Paoni responded, and companies that had more sophisticated supply chains were more likely to survive and thrive. That makes it an investment area, along with e-commerce. Another area, White added, is employee experience, including sentiment analysis.
The Canadian perspective
The Canadian mid-market is getting extra attention at SAP these days thanks to the January 2021 appointment of Gina Izumi as the first senior vice-president of sales for growth markets for SAP Canada.
The new role focuses on companies with revenue of $1 billion or less, and enterprise clients who are not using SAP ERP systems, as well as with the partner ecosystem that serves them. And, said Izumi, the C-levels she speaks with are all focused on growth and innovation; with SAP’s cloud solutions, even mid-market customers can take advantage of SAP’s almost 50 years of best practices that are embedded in the solutions.
“The pandemic really brought the topic of supply chain to become mainstream,” she said, describing an innovation day that SAP hosted for a customer who was looking for planning assistance. That customer brought 40 people from all departments to the virtual event.
“It wasn’t just your typical supply chain people, though, it was other lines of business, like finance, like HR, manufacturing. I think there was someone from the CX side, the CEO. They all took part in this, and there were root components that were appropriate to them as well, but the majority of it was around the supply chain,” she said. “And so when I say it’s becoming mainstream, that was one great example where people left saying, ‘Wow, I didn’t know that technology could do that. I didn’t know AI or machine learning was that advanced’, and they were so excited about what the future held in store for them.”
Sustainability is another topic that resonates with Canadian customers, Izumi said. During his keynote, SAP chief executive officer Christian Klein advocated making sustainability a business metric along with growth and profitability and introduced some initiatives to help make that happen, something Izumi is excited about.
“These new offerings that SAP is bringing out allows us to do that, allows us to measure it so we can take meaningful actions,” she said. “And I think SAP providing kind of that standard reporting and the analytics, and if we can again be leading the way and helping establish those global standards. I think that that’s going to be really beneficial for the world.”
You can learn more about SAP Sapphire Now here.