Forrester Analyst Key Takeaways from SAP Sapphire Orlando 2024
At the 2024 SAP Sapphire conference in Orlando, SAP unveiled several generative AI innovations and partnerships that showcase how the company is taking enterprise businesses to the next level in the era of AI. We heard from CEO and Executive Board Member, Christian Klein, and several other Executive Board Members, Julia White, Juergen Mueller, Scott Russell and Thomas Saueressig. It was refreshing to hear from SAP’s new Executive Board Member of SAP Product Engineering, Muhammad Alam bringing in fresh perspective to the next-gen evolution of their core products. Chief AI Officer, Dr. Philipp Herzig and Head of Global AI, Walter Sun took center stage as SAP is now infusing Business AI across their enterprise cloud portfolio that powers the world’s most mission-critical processes and pushes the edge of what’s possible with AI.
Here are some key takeaways:
Furthering Commitment to Responsible AI. SAP is redoubling its commitment to the principles of reliable and responsible AI by adopting the 10 guiding principles of the UNESCO Recommendation on the Ethics of Artificial Intelligence, which aim to ensure that AI technologies are developed and used in ways that respect human rights, promote fairness and contribute to sustainable development.
Announcing New Business AI Innovations. SAP embeds Business AI across its enterprise solutions providing rich insights at users’ fingertips and deliver better outcomes. Examples: AI-generated reports in SAP SuccessFactors solutions that give people managers responsibly sourced insights for compensation-related discussions; Forecasting capabilities in SAP Sales Cloud solutions that predict combinations of salespeople and products most likely to drive sales.
Several Key Partnerships That Scale Innovation. SAP announced several partnerships with best-in-class technology leaders pushing the limits of enterprise grade generative AI.
- Google Cloud: SAP will integrate Joule and SAP Integrated Business Planning for Supply Chain solution with Google Cloud’s Gemini models AI assistant and Google Cloud Cortex Framework’s data foundation to predict and mitigate supply-chain risks to minimize disruptions and maintain optimal inventory levels.
- Meta: SAP will leverage Meta Llama 3 to generate scripts that render highly customized analytics applications in SAP Analytics Cloud.
- Mistral AI: SAP will also add new large language models from Mistral AI, a global company headquartered in Paris specializing in generative AI, to the generative AI hub capability in SAP AI Core. For customers where EU sovereignty is a concern this is a key addition.
- NVIDIA: SAP and NVIDIA announce several cross-product partnerships – NVIDIA’s state-of-the-art AI models sift through SAP consulting assets to provide relevant and precise answers to SAP implementation related questions; NVIDIA’s accelerated infrastructure will run, scale, and manage SAP’s generative AI model for ABAP code generation; NVIDIA Omniverse Cloud APIs enable the simulation of complex manufacturing products and configurations as industrial digital twins.
- AWS: SAP is striving to make it easier for customers to adopt the RISE with SAP solution on AWS, to improve the performance and efficiency of SAP workloads running in the cloud, and to embed generative AI into an enterprise’s entire portfolio of business-critical applications. Bedrock is now integrated with SAP generative AI hub; SAP is an early adopter of Graviton using 60% less energy.
Joule to integrate with Microsoft Copilot for a unified work experience. Deep, bi-directional integration will allow employees to get more done in the flow of their work through seamless access to information from business applications in SAP as well as Microsoft 365. The integration is to occur later this year, combining enterprise data residing in SAP with contextual knowledge from Microsoft 365 including – Microsoft Teams, Microsoft Outlook, Microsoft Word and more. For example, by bringing Copilot for Microsoft 365 into Joule, a user can book a flight using SAP Concur and Joule, and Joule can block their calendar in Microsoft Outlook.
Introducing SAP RISE Validated Partners. SAP introduces a new RISE validation recognition program for service partners. Customers can more easily identify partners with deep expertise and experience in large and complex RISE with SAP implementations. These partners meet elevated capability and experience criteria for the RISE with SAP offering, have proven experience in large enterprise engagements, and demonstrate their implementation approach is aligned with RISE with SAP Methodology. Currently there are eight partners validated – Accenture, Capgemini, Deloitte, EY, IBM, Infosys, NTT DATA, and PwC. Additional eligible partners will be validated in the second half of 2024.
SAP Announces Strategic Partnerships to Accelerate Business AI Adoption.
- Accenture – Accenture is announcing its plans to embrace Joule’s SAP Consulting capabilities and ABAP Developer capabilities in compressed Cloud ERP transformations. Additionally, Accenture and SAP are teaming on SAP Signavio and SAP LeanIX solutions to help customers with insights, governance and capabilities to achieve their transformation outcomes.
- McKinsey – McKinsey Consulting unveiled an expansion of its Value Bridge consulting offering. Powered by SAP Signavio, Value Bridge aligns an organization’s strategy, operating model, business processes, data and technology to produce continuous business value.
- BCG – Boston Consulting Group announced a new offering with SAP which recommends opportunities to maximize digital transformation investments using SAP Signavio and SAP LeanIX. The offering allows companies to navigate continuous change and prioritizes ways to onboard AI-based innovations.
BTP Getting Much Deserved Limelight. Several enhancements and updates to BTP, which will need a blog of its own. All in all it was exciting to see the SAP underdog, BTP, receiving so much attention at Sapphire this year as in the past they often undersold the real value in this platform and how it can catapult SAP to where its power lies in the new enterprise AI race – in its complex BTP platform and its capabilities and massive amount of enterprise data – the new SAP is not just an enterprise software vendor!
Huge focus on GROW with SAP. I have been waiting for this moment. In fact, I did mention to several fellow analysts in the SAP community that I feel we are going to see SAP announce SAP S/4HANA public cloud being positioned for LE clients – and SAP did just that! It was announced that PwC is one of the first LE clients using SAP S/4HANA Public Cloud. It does appear that professional services firms are a good candidate for SAP S/4HANA Public Cloud – is this an industry cloud play or really pushing the limits for LE clients to see how they can reimagine working on a public cloud? We will have to see. But at least so far, we do have 2 different offerings from SAP, and it remains different between private and public edition. However, LE clients can use Public Cloud for newer lines of business or emerging GEOs. Meanwhile we will keep an eye on the LE client Public Cloud adoption in a non-2 Tier mode this year! In addition, GROW with SAP premium subscription will now expand to include access to the SAP Sales Cloud and Concur Expense solutions as of July 15. It already includes Ariba. This helps mid-market net new customers adopt GROW with better business coverage.
Newer Packages and Pricing. There has been consolidation of individual SKUs to packages oriented towards buying centers like oCHRO, oCFO, Supply Chain Managers, Procurement Officers, etc. Also, customers get implied discount in both RISE and GROW packages as well as buying center packages. This is a programmatic discount built into the whole package and not just applied to the first year. RISE may see more segmentation for discounts. Basically, part of the big value proposition in full suite is that it will have implied suite discount. This is something for customers to chew on as SAP is driving more customers to buy packages vs standalone SKUs.
Sustainability was missing in action. Compared to Sapphire 2023 where Sustainability was front and center at keynotes and several sessions, in stark contrast this year it was not talked about so much so that analyst community and conference attendees took notice. Upon asking the SAP board we were informed that while there was global momentum on sustainability last year, there has been no demand in the last 4 months. Parts of the world are seeing strong demand like the EU due to strict regulations and a sense of responsibility; other parts of the world are not. However, SAP is committed to delivering against the promises they made for green ledger and control tower.
Goodbye Best-Of-Breed and Welcome Suites (Again)! Considering every enterprise software and enterprise applications giant is re-positioning as a platform company in recognition of how AI (traditional and generative) in general is disrupting our enterprise world and its UX – SAP is no different. As Executive Board Member for product engineering, Muhammad Alam said, full value truly gets unlocked at suite. AI first and Suite first approach!
There is lots to unpack here. If you have any questions about SAP’s overall strategy, SAP Services Partners, RISE, GROW, what does SAP S/4HANA private cloud and public cloud mean for your organization, implementation strategies, SAP customer support vs. third party support, whether public cloud is the right choice for a LE client or the looming 2027 deadline in general – feel free to schedule an inquiry, guidance session or advisory below and request me as a preferred analyst.
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