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SAP is eager to move beyond its legacy ERP base to the intelligent enterprise.
In an effort to spur the development of intelligent enterprise systems and applications, SAP has offered qualified partners free access to development resources for S/4HANA and C/4HANA, what the company considers the "digital core" of the intelligent enterprise. In this Q&A, Steve Niesman, CEO at Itelligence, discusses why the partner access program is valuable in driving the innovations that characterize the intelligent enterprise.
Itelligence, owned by NTT Data, is an SAP reseller that provides implementation, managed services, hosting and application management for SAP for midmarket organizations around the world. Itelligence has built its business around legacy SAP ERP platforms, according to Niesman, and now works with the S/4HANA and C/4HANA digital core, as well as SAP's business network cloud applications -- SAP Ariba, SuccessFactors and Concur. The company hosts SAP systems on 12 data centers around the world and manages SAP infrastructures for customers on AWS, Azure, and Google Cloud.
Is Itelligence taking part in the SAP PartnerEdge free access program?
Steve Niesman: We're definitely a part of that, and we're using those systems across the SAP portfolio. It gives us two fast-mover advantages. First, it allows us to learn the products and expand our portfolio offerings to customers. Second, it gives us an opportunity to accelerate the ability to build our own intellectual property -- extensions on top of the SAP applications -- to create industry-specific and micro-vertical-industry-specific solutions to help complement that SAP platform and portfolio. It gives us an acceleration to innovation.
Why is it important to accelerate the path to the SAP intelligent enterprise?
Niesman: When you talk about digital transformation today, it's all about accelerating the pace of technology. If you know Thomas Friedman's book Thank you for Being Late or follow [former head of Google X] Astro Teller, they talk about this and how it's going faster than human's ability to adapt. So, these presets and demo solutions available in the partner-access program give us the opportunity to narrow the gap between the pace of innovation for technology and our adaptability to change.
How are SAP customers responding to efforts to implement the intelligent enterprise's applications?
Niesman: In the customer market we serve -- from $100 million to $10 billion -- there's incredible interest in the migration from ECC [ERP Central Component] to S/4HANA. The benefits around getting to that digital core, getting on the SAP platform, taking advantage of SAP systems of record, systems of differentiation, systems of innovation, it allows them to become an intelligent enterprise. We have tremendous interest in our install base. And over the next two to three years, I think we're going to see an incredible acceleration and movement within our customer portfolio to take advantage of that. Our customers are moving faster than others, and a big piece of our business plan over the next three to four years is migrating a very high percentage of our customer base over to S/4HANA.
What's the deployment model of choice for your customers: on-premises or some variety of cloud?
Niesman: We're seeing that customers are migrating from ECC to S/4HANA, a significant portion -- 70% plus -- are then migrating from on-premises to a version of cloud. They're accepting the cloud, and when they migrate from ECC to S/4HANA, they're going to the cloud.
What do customers see as the biggest pain points of a migration that need to be addressed?
Niesman: There are a couple of points to address. First, I think there's still a bit of misunderstanding from customers about how affordably and quickly they can move from ECC to S/4HANA. There are SAP tools and programs; on top of that, I tell them to build their own intellectual properties and accelerators to make that migration much faster and more inexpensive than customers realize. Second, I still think within the larger IT space outside of SAP, people misunderstand what digital transformation means.
However, once we're able to get in front of them with a workshop, we can show them the advantages of having a digital core -- the system of record -- within one platform, the SAP Cloud Platform. When you have that intelligent suite -- which includes those cloud areas like SAP Commerce, the experience from Qualtrics with the customer, product, employees, brand data within that same platform, and the integration and connections -- that's where you're able to innovate faster. That's where you're able to narrow that gap between technology moving so fast and an organization's ability to adapt to that change, and that gives you real competitive advantage.
People understand the technology case for building the intelligent enterprise, but find that making the business case is more challenging. How can companies justify the business case?
Niesman: The big animal in the world is Amazon, and my hypothesis is that companies are constantly changing and innovating to take advantage and to compete with the Amazons that they have their own vertical or micro-vertical. This ability to have a digital core integrated with your systems of differentiation -- these cloud products -- all in a suite on the same platform gives you incredible speed-to-market, incredible advantage around new avenues to revenue, the ability to lower your cost of IT, the ability to innovate faster, and a much better experience for your customers and employees. So, all that becomes a business case, if you will, for migrating from ECC to S/4HANA and the digital core.