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SAP: Driving a New CAR

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On October 7th, SAP announced its Customer Activity Repository (CAR) for retail. The announcement came immediately before it’s first global SAP Retail Conference in Dallas, Texas (prior to this year, SAP’s U.S. Retail group held its own events). The fact that the event was called “global” was one of the most visible indicators that SAP Retail is now under the guidance of Simon Paris, the company’s Global Head of Strategic Industries. Beyond that, the event was indicative of the importance of the retail vertical to SAP, and also of the fact that SAP has been steadily gaining momentum within the industry.

In no small way, the momentum that the company has recently achieved in the industry is the result of two very visible accomplishments. The first was the early 2012 release of its next-generation Planning for Retail, and the other was the recently completed acquisition of hybris. Both of those accomplishments filled significant holes in the retail portfolio. But the biggest industry buzz that SAP has been making in 2013 has to do with HANA, the company’s innovative in-memory data platform. Although the company has taken pains to show just why HANA should be interesting to business executives, in a way it harkens back to SAP’s “technology-oriented” value; it’s a well engineered piece of work (just the kind of thing to excite the grey matter of techies and closet geeks).

But that “is your grandfather’s SAP” (as Mr. Paris said at the Dallas event). Nowadays, the focus is on business value, not technical prowess. Paris made that absolutely clear when he outlined SAP’s retail strategy to be to:

  • Improve people’s lives and well-being anywhere, anytime
  • Raise living standards for all of society
  • Delight customers and inspire associates
  • Promote sustainable trade and trusted business practices
  • Reduce waste and spoilage

These aren’t modest goals by any stretch, and none of them allude directly to “reusable code”, “TCO”, “future proofing your technology investment”, etc. etc. – in short, none of the fodder that typifies the stated goals of so much enterprise software that one usually hears. It struck me that there is an unspoken assumption that the software engineering will absolutely work and that there’s no need to question it. If nothing else that shows just how advanced the state of software engineering is today. The message in Dallas was certainly very different from the speech that SAP founder Hasso Plattner gave at Sapphire in 2003, when he described what SOA architectures are and why the audience should care.

SAP’s New CAR

It is the difference in the messaging that leads me in a roundabout way to SAP’s Customer Activity Repository (CAR). CAR (which is built on the SAP HANA technology) is a “layer” in the application portfolio “stack”, where information related to the data entity CUSTOMER is kept for access by the business applications. Essentially, CAR separates (or “indirects”) the information that used to live in various of the applications, and was typically replicated for each new application that needed it (of course, causing the usual synchronization issues that resulted). In fact, the architectural idea of “indirecting” commonly used rules and data isn’t new; it’s embarrassing now to think about how much time and effort my retail IT shop put into achieving exactly that in our “e-Store” initiative in the late 1990’s. “Embarrassing”, because the truth is that it didn’t work very well at all. The architectural concept might have been fine, but the technology underpinnings for the architecture just weren’t mature, very powerful or fast. If what we built had been a tall building rather than business applications and the underlying database and messaging infrastructure, it would have fallen over, because we were building on the technology equivalent of sand.

Not so anymore. SAP has all the advantages that modern computing technology can bring to bear on “loosely couple” parts of business applications, so that they can be re-used by other apps. And by early appearances, it works. So what’s in the CAR?

Lori Mitchell-Keller (SAP’s Head of the Global Retail Industry Business Unit) and Mark Ledbetter (Global Vice President for SAP Retail) explained CAR this way at the event: it’s a repository of the “customer experience”, keeping customer attributes (for example, searches, tweets, Pinterest mentions, etc.) and transactional data. It also keeps information about product, inventory, and forecasts. It can be used for predictive analytics, loss prevention, and dashboards.

The intention of the CAR platform is to provide 360° of inventory visibility (consistently the #1 technology enabler for retailers’ future plans, according to several of RSR’s recent studies), provide customer insights to marketing and selling applications (often the #2 tech enabler in RSR studies), enable real-time customer segmentation, and to provide the basis for a unified forecasting environment (“UDF”, in SAP terminology). The first applications to use CAR are promotion management and customer segmentation, but “all retail applications are planned to sit on top of CAR and HANA in the next 18-24 months”, according to Mitchell-Keller.

For the time being, operational data from the various retail applications will be “live replicated” to CAR. In the future, SAP will enable “CAR native” applications, i.e. applications that are architected to use the HANA capabilities of the CAR platform directly. But in keeping with the company’s promise to be database agnostic, any application available today on RDBMS will be offered in “classic” mode as well as on CAR, i.e. capable of using a traditional OLTP database such as Oracle or IBM DB2.

‘DO NOT REMOVE’

The challenge for SAP, at least in CAR’s early days, is going to be to keep the value pitch focused on the business, not the technology, value. There’s an almost irresistible urge to look at what’s under the hood. But that’s not what will cause most business executives (other than the CIO) to sign on the dotted line.

While listening to the SAP executives talk about the new platform, I couldn’t help but to think about the time I went out and bought a BMW 740i. The truth is, it was an amazing machine, easily the best car I have ever owned. Everything about that car was a rush; it looked great, had more power and better handling than I had ever had at my fingertips before, leather seats that felt like a perfectly worn-in baseball glove (and me the ball), and a fabulous stereo! But being a guy, one day I decided to look under the hood to see what my big V8 looked like. Imagine my surprise when I saw… an ominous looking pewter-and-graphite colored cowling over the whole power plant with big letters reading “B M W” over each head. Since I didn’t know how to take it off, I looked into my new owner’s manual, where it clearly stated something to the effect of, “DO NOT REMOVE: removing the cowling by other than a qualified technician will void the factory warranty”. In other words – “don’t even think about it”.

That is SAP’s challenge, to not take retailers on a little tour of what’s under the hood. Knowing how much of an architectural dream-come-true the idea behind CAR is for many retail technologists, the company must nonetheless resist the desire to let ‘em take a peek. And that in turn means that SAP is asking the customer to trust its promise that its historical strength as a premier software development company remains.

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Articles & Opinions October 29, 2013
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