By Rizal Ahmed, Chief Content Officer, SAPinsider
Navigating the Digital Transformation Dilemma
In an unprecedented approach to a major announcement, SAP CEO Christian Klein led a virtual event to unveil a new integrated offering called “RISE with SAP” aimed at facilitating companies’ digital transformation initiatives. The event featured comments from other key tech leaders such as Satya Nadella, CEO of Microsoft, and Roland Busch, Deputy CEO of Siemens AG.
The event opened with a video and commentary from Klein painting the backdrop of a challenging, constantly changing business climate that has elevated the priority around digital transformation. “Digital transformation is at the top of the list because disruptions are increasing in frequency and magnitude,” says Klein.
Klein acknowledged the challenges of getting true transformation projects off the ground. Top among the hurdles he described is creating and communicating tangible benefits as well as developing concrete steps to move forward. One of the objectives of RISE is to help provide results-based motivation and a roadmap for SAP projects. “The key challenge for many enterprises is how to holistically transform when they are still successful in the market,” describes Klein. Those are the specific problems that RISE with SAP is intended to solve.
Key Elements of the RISE Offering
Klein describes RISE with SAP as Business Transformation-as-a-Service. Plainly put, it is a single integrated, analysis solution and service offering under one contract that will support SAP customers’ end-to-end transformation project. RISE with SAP is organized into three key elements.
Redesigning business processes: This component draws on SAP’s vast experience and business process data across most major industries. Business processes and transactions represent the backbone of SAP’s history and strength. SAP will leverage this data and insight to help companies build best practices and leading-edge processes. SAP also announced the intent to acquire process mining vendor Signavio to help support process analysis in the process redesign stage of the project.
Enabling technical migration: This stage involves the migration to the digital core; essentially SAP S/4HANA, and limiting customer reliance on custom code. This was a major theme during today’s discussion as excessive customization has been seen as a hindrance to business agility. Simplifying integration and interfaces are also core objectives. SAP will help organizations migrate to a single semantic data layer and start to standardize around SAP Fiori as the de facto user interface. Not surprisingly, the cloud is seen as the ultimate destination for housing the digital core, and SAP will provide more automated migration tools to help customers get to the cloud more efficiently.
Building an intelligent enterprise: SAP has been talking about this concept for years. At the foundation of this element is SAP Business Technology Platform (SAP BTP), which resembles (for those of you who have been in the industry for years) the old SAP NetWeaver platform. SAP BTP is more modern, but many of the perceived benefits are the same — such as tighter integration through centralized access to more than 2,200 application programming interfaces (APIs) as well as common data models to facilitate data sharing and management. Klein specified that customers could expect up to a 20% reduction in total cost of ownership from making these changes.
Klein also talked about more embedded artificial intelligence, robotic process automation, and advanced analytics. Access to thousands of business partners through SAP Ariba and other business network solutions is also a major part of this offering.
CIO Reaction: Love the Vision, but Want to Explore Practical Impact
To further understand the customer perspective on the RISE with SAP announcement, SAPinsider interviewed four executives from its SAP executive forum community. Those individuals included Nik Giannakakis, Group CIO of Hellas Motor Oil; Robin Mager, Vice President, SAP S/4HANA, of Schaeffler; Nuno Miller CIO and CTO of Sonae Fashion; and Christian Niederhagemann, CIO of GEA Group.
All the executives are at various stages of their own transformation projects, so it was interesting to see their reactions and questions based on where they were with their initiatives. Those further along with their projects did not see as much of a need for RISE with SAP as those who were just getting started. “We started our transformation project a few years ago and are already down a path similar to what Christian described,” says Niederhagemann. “We run all these initiatives on Microsoft Azure, we run all our process management on Signavio, and we are working with one of SAP’s major partners Accenture. It’s a great offering, but a similar approach to what we did, so we will continue down our path until 2025. There may be an opportunity to apply RISE with SAP to some other processes, but we have our roadmap set and done.”
Overall, the executive panel was very enthused about certain elements of the RISE with SAP announcement including the drive toward simplicity and integration. “From a high-level view, it’s the dream of a CIO,” says Giannakakis. “You work with a single partner that offers end-to end services. It is a one-stop shop for leveraging the strong elements of data layer, the intelligent enterprise. For me, it’s the answer to all of my questions, but also I have to really understand how this will work.”
The executive group also welcomes the more tangible benefits-oriented approach that RISE with SAP seems to embrace. “When you talk to the SAP and partner consultants, there seems to be a disconnect describing the business process capabilities from SAP — where they have struggled to answer the questions of quantifiable value,” says Mager. “If RISE with SAP truly addresses this challenge, I am happy to learn more.”
However, like all discerning decision makers, they are trying to balance their enthusiasm with the practical reality of instituting significant change for tangible gain. “I would describe the announcement as interesting, powerful, and challenging,” summarizes Nunez. “The idea is very powerful. It matches a lot of what Sonae Fashion has been doing over the last three years regarding transformation and the move to an intelligent enterprise. It’s powerful because it is very aligned to business needs for industries across the globe. And it’s challenging because it’s difficult to institute massive change across people, processes, and technology and rethink how your business operates.”
As they would with any new offering, our executives questioned the true readiness of the solution to support all types of customers. Mager says, “It sounds interesting, but is it usable for customers with a highly integrated and customized landscape, and does it address customers who are using SAP applications across the value chain? Klein talked about one business model. We see gaps in some of the core solutions. We are working closely with SAP to close those gaps, but we need to understand this impact fully.”
What Does This Mean for Decision Makers in the SAPinsider community?
Whether you are optimistic or skeptical about the business transformation-as-a-service, here are some simple actions you can take to further consider this announcement and what it means to you:
- Get informed on RISE with SAP. Whatever your initial reaction, RISE with SAP is a significant offering that needs to be carefully considered. There is no risk in informing yourself. Talk to your SAP representative and seek out more articles and information from SAP, SAPinsider, your key partners, and other important resources. Get your questions answered and demo capabilities. We’ll be covering this solution closely and will continue to share resources and other information that can help you make an informed decision.
- Consider the solutions you have already invested in: Many of the benefits described during the announcement seemed to be integrated into existing SAP solutions whether they are part of SAP BTP, SAP S/4HANA, or SAP’s software-as-a-service portfolio. Also, with the impending acquisition of Signavio, it’s unclear whether you can plug in other process mining solutions. That’s why it’s important look at your existing solution portfolio and technology stack and ask your SAP reps how these solutions might be incorporated into RISE with SAP.
- Seek out what your peers are thinking and doing: When we asked our executive interviewees how they will consider RISE with SAP, they talked about their intention to not only engage SAP and SAP partners but also their peers to learn from their perspective and questions. SAPinsider will be conducting its first Executive Forum on Innovation in March, which RISE with SAP will be a key topic. Make sure you attend this and other key events that can help broaden your knowledge.
- Beware that RISE with SAP won’t solve your organizational challenges: One of our insightful CIOs pointed out that an integrated offering won’t solve your digital transformation troubles if your business and IT organizations aren’t properly aligned to evaluate RISE with SAP and then apply it to the project. Having strong communication between the groups, as well as a strategy and mindset that supports innovation and a deep understanding of how technology enables transformation, is key to making any solution work.