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SAP’s Analyst Day In Review: A Whole Lot Of Info In Less Than A Day


Last week, all three RSR partners attended SAP’s Industries Analyst Base Camp at the company’s US headquarters in Newtown, PA. The event’s creative new format married 2 half day sessions together: the first, an afternoon of overarching sessions, focused heavily on the technologist’s vision for its Intelligent Enterprise, and how it believes that strategy can set it apart.

Lori Mitchel-Keller, President of SAP Industries, began outlying a strategy that relies on taking disparate customer experience and management data and combining it with the transactional – what SAP calls the marriage of X and O data. The X includes such parameters as personal customer information, product, employee, and brand data, while the O contains information around manufacturing and the supply chain, the customer experience, core finance data, people engagement, and network and speed management. By doing so, SAP believes its digital platform can help what it calls the “experience economy” – and that it can do so across any industry.

We saw compelling evidence that SAP is able to do this in such industries as health care (Mercy Hospitals), CPG (Bumblebee Tuna), Finance (EY) and Oil and Gas (BP) – and there were some clever little cross-industry insights gained by each’s early adoption of this “experience economy” work. For example, EY is helping customers make better budgetary choices in the tiny little things they do every day: if a customer has identified that they spend too much on coffee and want to stick to a budget, the accounting firm can alert them when behavioral patterns suggest their smartphone is on the way to a Starbucks – and recommend some other things to go do, instead. And from the world of health care, data analysis of doctor appointments has shown that kids under the age of 18 show up to nearly every appointment made. Their parents see to it. But that the moment 18 strikes and they become responsible for themselves, it is all but guaranteed they won’t stick to the appointment. This is a true frustration (and cost) for health care professionals, and by using SAP’s analytics Mercy Hospitals have been able to identify that this trend continues all the way up until the age of 26. The result? More reminders and penalties for those that fall within the range. The result is that more people who make – and need – their appointments, will be less altered by this phenomenon.

Practical stuff for sure – but we came for retail!

Luckily for us, the 2nd half day, an 8am-12pm breakout session, was to be spent with SAP’s retail International Business Unit. And the team, led in this case by Global VP Ralf Kern, was brutally honest about their strengths, potential blindspots, and roadmap going forward. Some of what we saw was protected by NDA, but for the things that weren’t, here’s what I can share:

  • 1.C/4 Hana is the solution set under which all the vendor’s retail innovation can be classified, and it is – and will remain - comprised of 5 clouds: Marketing, Commerce, Customer Data, Sales, and Service. These 5 clouds facilitate the flow of X and O data back and forth – this is the platform the company is committed to and will remain unchanged going forward.
  • 2.“C/4 Hana makes the promise, S/4 Hana keeps the promise”. This one may be just for me, but I tend to get lost in the naming of these things, and for whatever reason, this little ditty finally helped me keep the full SAP portfolio squared away in my mind.
  • 3.SAP is serious about helping retailers put consumers first. The “why” and the “what” of the world are to be thoroughly separated in everything the company does, but are also to be flowed in tandem and married together at any point a retailer so desires. This X and O content vision from Day 1 was referenced extensively during Day 2.
  • 4.“This is all about creating experiences that customers can trust.” It doesn’t matter if an experience is brand new, in the vendor’s estimation, but the natural evolution of retail will ensure these experiences keep changing. That part is truly irrelevant, and the lens of time will likely see a lot of whiz-bang innovation for innovation’s sake go by. What SAP wants to remain focused on is can they things they enable help retailers win consumer trust. It’s a spectacular vision to keep in mind while designing any new UX.
  • 5.The company’s strategic priorities have not changed since last year – or the year before. In fact, at IABC in 2017 we saw SAP roll out customer centricity, serving the segment of one, the digital supply chain, smart stores, and business model innovation as its 5 key priorities. They remain unchanged today, because, as Kern so aptly put it, “We don’t need to come up with something new to market every year. We need to deliver on what we promised we would.” Or as another SAP professional put it, “These are like the 10 Commandments.”
  • 6.SAP’s Analytics Cloud will be a layer that integrates to all existing solutions. It is already in use at a clever little popup store in Geneva’s main train station (AvecBox), and if you get a chance to see that demo you absolutely should. The store operates more like a physical manifestation of webpage than a store, and every bit of technology it uses is currently available off the shelf and without customization. That said, it does not have the physical constraints that any “legacy” store would have, and SAP is well-aware that its ongoing cloud offering will have to work and play well in a hybrid environment of on-prem and cloud-based technologies for many years to come.
  • 7.We saw a much more detailed version of the company’s well-lauded case study with Swiss Grocer Co-op. If you haven’t heard the story, Co-op operates 2,400 stores across Europe, has 86K employees, and 50% of what is sells is private label. The company has historically had lots of problems with overstocks and resulting wastage, and wanted to use AI to get more accurate predictions for planning and promotions. Its planners were incredibly hesitant to hand over control, but having done so delicately the retailer has already seen greater reduction in waste, fresher goods for customers, less tied up in capital for excess stock and a better reputation with customers. This is all live for the breakfast category in all stores, and in another few weeks’ time they’ll fold in all refrigerated goods. What makes the story all the more compelling is that Co-op, often thought of as a Switzerland-only brand, is rapidly extending its wholesale business into Germany, Poland, Austria, and Russia.
  • 8.Predictive & Analytics tools are changing. Whereas the majority of requests SAP heard from retailers a year ago were centered around, “How can I adjust my forecast?” the tone of the conversation has morphed. Retailers are now asking “How can I maintain demand?” This is news to our ears here at RSR, and ties very nicely to what we’ve seen in our most recent research. “The Planning Moment,” as we’ve been calling it, appears to loom large, indeed.

At the end of Day 2, my partners all agreed: SAP is on a much more focused (and easier to understand) path than any of us would have known 24 hours prior. It was a tremendous amount of information to take in in one sitting, but we were all very happy that we did.


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Articles & Opinions July 23, 2019
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