Get started Bring yourself up to speed with our introductory content.

The answer's HANA: Now, what was your SAP ERP question?

Industry analyst China Martens offers guidance on where HANA might fit in an SAP ERP strategy.

Five years ago, SAP's HANA was an emerging, internally led and academically fueled application architecture project. Today, the in-memory database system sits at the heart of SAP's technology plans. As such, SAP ERP customers need to consider how this HANA focus will likely impact their current and future application strategies.

It became possible this year for SAP customers to deploy some or all their ERP applications on the HANA database, whether they're using Business Suite on HANA or any of the trio of SAP's midmarket software -- Business All-in-One, Business ByDesign or Business One. So far, SAP claims to have 470-plus Suite on HANA customers, with 30 systems live. There's no single profile for early adopters in terms of industry or geography, and they range in size from a 20-user installation up to 100,000 users. SAP itself, home to 56,000 staff, is also an early drinker of its HANA vintage and runs its larger enterprise applications, including closing its third-quarter 2013 financials, on HANA.

All in all, those numbers are not bad going for less than a year's general availability, but is it likely that the tens of thousands of existing Business Suite customers will also move to HANA? SAP's primary customer pitch for adopting HANA was the ability to speed up processing dramatically, but that focus is now shifting toward a promise of simplifying business processes.

Questions to ask about SAP ERP and HANA

Suite-on-HANA early adopters, especially at smaller companies, are looking to the technology to help them rethink their processes, particularly industry-specific ones, and to run them in real time to drive efficiency. However, many firms have already invested heavily in customizing their SAP ERP to the needs of the industries they serve and those of their own organizations. Are these companies likely to make another major move any time soon?

A stronger argument for migrating ERP to HANA would be one that couples business-process simplification and speed of execution with quantifiable cost savings. In talking about a highly simplified, smaller software footprint for its own Financials on HANA, SAP anticipates realizing sizable hardware and storage savings. Being able to put specific figures on its own HANA adoption story and that of its larger customers may be the tipping point for Business Suite users that enables them to justify the time and cost involved in an infrastructure shift.

More on SAP ERP

See the latest trends in ERP customization

Understand two-tier ERP

Watch an interview on how HANA can improve SAP ERP

Another wrinkle for customers to consider is how Suite on HANA evolves once SAP builds out its promised line-of-business and industry functionality based on the combination of HANA database and HANA analytics. Is there a danger that functionality gaps will open up between future versions of Suite on HANA and Business Suite powered by non-HANA databases?

For now, it's worth SAP customers investigating what Suite on HANA might do for them and at what pace they might make the move. In general, early adopters tend to migrate to Suite on HANA rather than performing a fresh installation, which means they've already invested in the more recent versions of Business Suite and NetWeaver required by HANA. In deployment terms, early adopters of Suite on HANA are interested in the cloud, typically choosing to run ERP on a private cloud while running other business applications side by side in the public cloud.

In some ways, SAP has been its own worst enemy when it comes to HANA, putting out confused or nebulous messages about the technology's scope (Q: Is HANA an analytics product, a database or a development platform? A: It's all three); its pricing (viewed by customers as expensive or unclear) and its impact on existing SAP software (e.g., is Business ByDesign dead?) That's not likely to change because HANA, like the new platform strategies of IBM, Microsoft, Oracle, Salesforce and others, is still in a state of becoming.

At present, HANA appears to be the answer to every SAP ERP strategy question but that may not remain the case. Vendors often spread themselves widely across all facets of a new technology, only to later retrench or refocus on core areas and establish partnerships to serve other areas. What many SAP ERP customers need to see from SAP is more of a sense of how Suite on HANA operates in the hybrid deployment world in which firms run their businesses. This is particularly key for customers who are not looking to extend their SAP footprint or actively shrink it.

The focus in 2013 has largely been on SAP and its relationships with innovative HANA startups, but hopefully 2014 will herald substantive partnerships with large third-party application vendors.

About the author:
China Martens is an independent business applications analyst and freelance writer. Email her at or follow her on Twitter at @chinamartens.

Dig Deeper on SAP selection and implementation

Start the conversation

Send me notifications when other members comment.

Please create a username to comment.