SAP Sapphire 2024 could be a balancing act for the vendor as customers continue to focus on legacy technology while SAP asserts the need to move away from on-premise systems and towards the cloud.
Additionally, SAP Sapphire, which is co-hosting the event with SAP's user group in the Americas, is expected to focus on new technologies, including AI products. Specifically, industry experts expect SAP to offer sessions at the three-day customer and partner event this week focused on how its “business AI” — concepts aimed at achieving business- or industry-specific outcomes through SAP's AI, such as its Joule-generated AI assistant — can create value for customers.
But customers may not be ready to embrace such technology, and analysts are also looking for concrete, practical advice on how they can address the problems they face.
See what other customers are doing
Liz Herbert, vice president and principal analyst at Forrester Research, said customers have a fundamental question: how can similar companies execute major projects such as cloud migrations in a proven way and tell the value story?
“There might be some notable partnership announcements from time to time,” Herbert said. “Of course, they need to show off AI, but that doesn't set them apart from other conferences in the ERP space.”
John Reed, co-founder of enterprise industry analytics firm Diginomica, said this year's Sapphire is a crucial trade show because it's important for SAP to attract customers with its emerging technologies, especially AI. Those customers also face practical issues, such as a 2027 end-of-support deadline for legacy SAP ERP products.
“We often hear from customers that they need more resources by deadline — more business cases, more skills development,” Reid says. “They want confidence in how they're going to tackle it, whether it's going to be a technology upgrade, and if so, can SAP make it easy for them. It'll be interesting to see if SAP can balance those two challenges.”
Demonstrating the real benefits of AI for business
Joshua Greenbaum, principal at Enterprise Applications Consulting, said SAP needs to demonstrate real value in its burgeoning AI capabilities in its products.
“I would love to see, and I believe SAP will be proactive in demonstrating true business productivity case studies around AI capabilities and make that a reality,” Greenbaum said. “SAP has AI capabilities, they're here already, and they're building out more true AI capabilities that will bring value.”
The imperative now for SAP is to show that this is not just window dressing, and not just a few small wins here and there, but that it actually has real value.
Joshua GreenbaumEnterprise Applications Consulting Principal
Customers are demanding this evidence and need to see that SAP can deliver these capabilities, he said.
“The onus now is on SAP to show that this isn't just window dressing, this isn't just a little win, this actually has real value,” Greenbaum said.
Reid agreed that SAP needs to show the practical benefits of using AI, rather than big ideas about what will happen in the future. One thing SAP should show is an example of how AI connects to a data strategy with tools such as SAP Datasphere, an enterprise platform that integrates data from internal and external sources. Getting this right is key to AI.
“What customers welcome most of all is information about AI readiness,” Reid says, “how do they start to prepare to take advantage of this capability, what does data governance entail, what oversight is needed, and how does this fit in with their human workers who are wondering how this is going to benefit them.”
SAP needs clarification
SAP also needs to clarify questions customers have about its Rise with SAP program, designed to ease the transition to the cloud, he said. SAP has continuously added features to Rise with SAP for customers since the start of 2021, but many customers still don't understand what that means specifically for them.
“SAP hasn't always acknowledged how much work it needs to do to make Rise relevant,” Reed said. “It raises questions about what a clean core means and what options are available.”
Brian Hardee, CIO of PureTech Scientific, will be joining Sapphire to speak on stage and in a roundtable about the company’s experience implementing S/4HANA Cloud.
PureTech Scientific, a manufacturer of glycolic acid used primarily in industrial cleaning, went live on S/4HANA Cloud after a 14-month implementation project, Hardy said.
“I hope to have the opportunity to tell the PureTech story at customer roundtables and other occasions to help people understand that you can get anything you want from PureTech. [S/4HANA Cloud]” Hardy said in an interview with TechTarget Editorial.
As SAP gears up for its annual user conference, executives like CEO Christian Klein, pictured here at Sapphire 2023, are expected to juggle AI ambitions with the realities of the cloud.
The Value of Live Interaction
The ability to talk to other clients considering or undertaking similar projects is a valuable benefit of joining Sapphire, he said.
“I’m always learning something from everyone I interact with,” Hardy says, “and I want to help others understand they have the same opportunity and help them understand on the front end the tips and tricks they need to get the most out of their systems integrators and applications.”
That's one of the reasons why SAP is continuing to hold Sapphire as a live event, albeit on a scaled-down version that now also includes a virtual version and a separate edition in Barcelona.
The variety of options should be appealing to customers who want information but can't attend from far away, Herbert said.
“SAP has always hosted regional events, but being able to host these events more easily for customers who have less interest or budget for travel is a big deal,” Herbert said. “It's great for European customers to not have to travel all the way to the U.S., saving them money and time.”
Scaling back regional and virtual events also aligns with SAP's messaging on sustainability, she said.
While SAP has had success delivering streaming content and interactive virtual sessions, there is still great value in getting people together in the same room, Reed said.
“This is ultimately a relationships business and it's easier to solve problems face-to-face. Being in the right place at the right time has the benefit of potentially meeting with SAP partners outside of business hours who could make a difference to your project,” he said. “Those are things that are very hard to simulate online. It's not impossible, but a hallway encounter is more likely to make a difference to your project.”
Jim O'Donnell is a senior news writer for TechTarget Editorial covering ERP and other enterprise applications.
