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What is SAP's cloud strategy?

While many have criticized SAP's cloud strategy for being unclear and erratic in the past, it's beginning to fall into place, writes Ethan Jewett.

Like most things at the German enterprise software giant, SAP's cloud strategy is complex. This complexity is, in large part, driven by the diversity of customer needs that SAP is trying to address. However, with the recent SAP Sapphire Now conference, as well as other presentations, SAP's strategy is starting to come into focus. Blogger and SAP expert Dick Hirsch has done excellent leg-work investigating SAP's cloud strategy, and his writing on SCN is worth following for a deeper look at SAP's cloud ambitions. I'll provide a brief overview of the parts of SAP's cloud platform here:

  • HANA Cloud Platform (HCP): This is SAP's platform as a service (PaaS) offering. Like other PaaS offerings, it includes application development capabilities as well as an array of services, including database, identity, user interface and connectivity to existing on-premises systems. In the case of HCP, the application development capabilities are focused on Java-based development, but development based on HANA Server-Side JavaScript (XSJS) is now supported as well. This platform is focused on developers, and is also positioned as a platform for extending SAP's cloud applications, like SuccessFactors.
  • HANA Enterprise Cloud (HEC): SAP's managed offering for applications and technologies that traditionally run on-premises, including HANA, SAP Business Suite and SAP Business Information Warehouse. In some sense, HEC is like a managed hosting offering, but it includes some management features that mirror infrastructure as a service offerings like Amazon Web Services EC2. In HEC scenarios, SAP manages application setup and patching, but the customer appears to be responsible for configuration of the application.
  • Cloud applications: SuccessFactors, Business ByDesign, the newly announced SAP Simple Finance, and many other applications are available on a subscription basis as true cloud applications, requiring no technical setup or configuration. SAP's strategy appears to be to develop these applications on HCP, and migrate older applications where appropriate. It's important to note that while these applications deliver the benefits of cloud applications, they still often require functional configuration, data migration and change management, so implementation is not instant.
  • SAP Fiori/SAPUI5: Fiori is SAP's unifying design language for applications and is being applied to SAP's cloud applications. It is technically based on the SAPUI5 JavaScript library, which is available as part of HCP.

SAP Simple Finance, announced at the SAP Sapphire Now conference this year, deserves further mention, as it is the first application from SAP that appears to have been architected to span cloud and on-premises landscapes. According to SAP, it can be used "as a service" as a truly "cloudy" application, meaning sign up and payment -- but no technical setup -- are required. Alternatively, it can be used in a managed mode as part of HEC, or deployed in a purely on-premises fashion as a SAP Business Suite add-on. This is a strategy to watch for more of in the future.

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