What was the biggest change for SAP HANA in 2013? And what will be the biggest in 2014? Listen in as John Appleby, Global Head of SAP HANA at Bluefin Solutions provides his thoughts and gives his inside look at what we might see from SAP HANA in 2014.
Dave: Hello and welcome! This is Dave Hannon with SAPinsider. Joining me today is John Appleby, Global Head of SAP HANA at Bluefin Solutions and I’m going to be talking with John a little bit about SAP HANA, the year ahead, and 2013 and a little bit about what we can expect in 2014. Thanks for joining us John, welcome.
John: Thanks so much Dave, it’s a pleasure to be here.
Dave: John, looking back for a moment 2013 was a pretty busy year for SAP HANA in a lot of ways. There were new customers, new use cases, even some new positioning. What do you see as the biggest change for HANA in 2013?
John: Well, I think there were two big changes but the biggest change by far I think was the view of HANA as a database across the industry and as an industry, sorry, rather mission-critical database, if that makes sense. And every customer is in a kind of different place in its view on HANA, as to the deployment of HANA. But there are a number of those now that are using HANA for mission-critical apps and not just reporting apps. And I think that’s a significant change. And with that has come the move to positioning around the cloud, around the Enterprise Cloud from SAP, but really that’s just a continuation of that messaging which is HANA is ready for mission-critical not just for analytical apps.
Dave: Ok, ok. So how do you think that change impacted the perception of HANA to potential customers out there who are maybe sort of keeping an eye on it and looking for their opportunity to adopt?
John: If we think about a typical adoption curve of technology, right, I think the answer is not necessarily that much, because people adopt technology at different rates. So if one person, like SAP, I mean they’ve moved all their major mission-critical apps onto HANA. For every company that’s doing that is at the front of the adoption curve. There are plenty thinking, ‘Right, it’s now time for me to do my first piece of deployment’, and there are plenty of people who are thinking, ‘What should I do?’ So really all that’s done is moved the adoption curve along from analytics collapse being bleeding edge to analytics collapse being mainstream.
Dave: Ok, ok, good. I wanted to talk a little but about some of the use cases we saw this year, I know you’ve worked with a number of customers out there and there are some interesting things going on with HANA, I was wondering if there was a particular customer out there using HANA in a way that might have surprised you or intrigued you, or something unexpected you saw this year?
John: I mean, pretty much every day, I’ll be honest, it’s a discussion. I’m surprised by the way people are thinking about it every day. But there is one particular example that struck me this year and I remember being sat in a room talking about the HANA platform to a group of people and I realized a couple of minutes in that none of the people in that room had ever touched an SAP system and they didn’t know what SAP was. And that was a significant moment for me, and they wanted to know about the HANA platform from a technology perspective to understand how they could apply that to their business.
That was kind of the point that made me think, ‘Right, something’s really changed here’. And actually they were thinking about using it for essentially a— and I can’t talk too much to the use case, but it is a very high volume, real-time, transactional app. And for me there have been a number of those that I’ve seen where people are actually looking to do real-time transactions in a way that would change their market. And I think that that’s quite surprising, if that makes sense. And the fact that these people had never ever seen an SAP system probably apart from to input their expenses.
So, I’ve seen a number of them across the board, I’ve done a lot of work in financial services this year so a bunch of those have been in places like capital markets, and those people kind of understanding that HANA is a platform, with a capability to combine the processing of transactions in real-time and, if we move towards capital markets you can think real-time analytics and real-time risk. If you combine and real-time prediction, and real-time social analysis, sentiment analysis, text analysis, being able to do all of that in one platform enables them to change the way they do business, and I think for me that’s the thing that’s surprised me most this year.
Dave: So, looking forward to 2014, if I’m an SAP adopter already, what should I be keeping an eye on? Are there changes in functionality or new use cases or integrations or things you’re expecting or hoping to see in 2014?
John: You know, if you think about the— you hear different numbers, sixty to eighty thousand SAP ERP customers, twenty thousand SAP BW customers, you know the levels of adoption in percentage point terms are quite low. But that’s not a bad thing about HANA, it’s just that there’s a lot of people to adopt it. I suppose I’d first of all talk to those SAP install base customers who are just thinking about what to adopt, and for me, I think that the learning this year is that if you have SAP BW Data Warehouse, it’s a really good place to start if you haven’t adopted anything yet. And the reasons for that are because it provides a very simple and easy-to-understand benefit, it’s relatively inexpensive compared to doing various other projects it’s simple, the license cost is a little lower, plus the cost to move it is lower so it’s relatively low-cost to do and you get into the HANA platform and understand the benefits of the platform across the board. And I just wanted to put that before that, and I think it’s a really good place to start. And I think often starting somewhere else can really be a mistake because you’re trying to understand something which is completely new in different terms.
If you’re already a HANA adopter, then again the largest portion of those are, BW on HANA adopters within the installed base, that is the largest number, so if you have BW on HANA, I would say a couple of things, you’re probably thinking, ‘What next?’ and so have you optimized that system first? There’s a lot of things you can do to sweat some value out of the BW on HANA investment, that would be the first thing. The second thing is, have you considered acquiring a little bit of the full HANA version, the HANA Enterprise, and combining it in with BW, to fix some specific pain points and I was talking to a customer yesterday and they just wanted to get some transactional reporting in additional to BW so they could just add a little bit of HANA Enterprise onto that to get maybe, ah, maybe they could get some real-time reporting on some transactional-level financial transactions at the same time, so that’s starting to build up the story.
I guess the third category would then be you know, listen, if you’ve deployed BW and you’ve got HANA and you know how to maintain it, have you considered some specific transactional data mart scenarios? That stuff is very popular. And then probably the fourth category would be if you’ve considered some of that, have you considered if you’re an ERP customer, HANA Live , side-by-side, so you can run a HANA system next to your ERP system and run all of the HANA Live reports which allow you to get real-time operational reports, there’s a whole suite of those now and there’s a lot more coming.
And then the fifth category would be if you’re comfortable and you know how to run the appliance, is it time for you to actually move your transactional system on HANA? I would say especially now with the SP7 release that we’ve just had, with HANA that came out two weeks ago, unless mission-critical is your number one priority, if there are other things that prioritize in your business like generating revenue, reducing cost, but unless mission-critical is your number one priority, HANA is a stable mission-critical database supporting all the stuff that you’d expect around resilience and business continuity. And if you move your ERP system onto HANA the things that you can do in the future are really very interesting and I think we’ll hear more about those next year but for now even just moving the database on there and then looking to get the HANA Live, reducing your time to close financials, just some of those simple steps will give you a platform. There you go, lots in 2014!
Dave: That’s great! You mentioned adoption, customer adoption, a couple of times and like most new technologies the adoption of SAP HANA has been scrutinized since its release. What do you see happening in 2014 in terms of adoptions there?
John: Well, and I’ve always said to people that adoption of HANA is the hardest thing, and it’s really hard for a bunch of reasons, none of which are anyone’s fault. But you know the first reason why it’s hard is you have to get your mind around a slightly different paradigm, because HANA requires you to think about the problems in a slightly different way in order to understand why it’s useful, so first of all people have to go along a kind of personal journey of realization. Typically I’ve found that you have to spend you know, four to five meetings often, just understanding that paradigm. So that’s a barrier to adoption. The next barrier to adoption is that you’ve got internal opposition to any new technology because those people have got jobs that rely upon it. And then the third probably major one is you have to deploy new hardware at it, which is sometimes unfamiliar, and even probably a fourth one, which is you have to move your existing apps in many cases because most people have got existing BW or ERP apps that they want to move. So there’s lots in the way of adoption of HANA, lots of barriers.
Now the interesting thing is SAP have tried to beat those barriers down and I think that 2014 will signal an increase in the volume of adoption as a proportion of sales, this is probably my prediction. And I think there are a few reasons for that. First I think the market as a whole has accepted HANA as a platform and so that general understanding of what the platform is has come, I think that shouldn’t be underestimated, and I think that the second thing is that database administrators and so on have realized that HANA is happening, and therefore they want to learn about it and they want to be part of it, and that’s helping. I think we still see a lot of resistance in places where there are things like Teradata, but I think a lot of people running regular RDBMs are happy to learn.
I think the third thing is, there have been a bunch of things that make it easier to get there, from the trial solution of BW on HANA that you can get on AWS, to different pricing models, I have a suspicion we’ll see more innovative pricing models from SAP as it continues to move to the cloud next year, I wouldn’t be surprised if that happens, especially around subscription pricing, just guessing. And also the Enterprise Cloud is there, which gives you another deployment option, but in parallel with that there are a bunch of hardware innovations coming from Intel around its Ivy Bridge and Haswell processors, and what they will do is they will reduce the cost and increase the density of systems, plus there’s support for things like virtualization on the way, that’s nearly there, and you can see how all these things add up to make adoption easier. Adoption isn’t one problem, it’s a series of walls that you have to run through, so you have to beat those down. I think in 2014 the barriers will be less than they’ve ever been before. Will it be explosive? I don’t think that adoption is ever truly explosive, I think it’s slowly exponential.
Dave: Ok good. Lastly, if you’re a company that’s decided to implement HANA in 2014, what advice do you have for them, other than as you mentioned earlier, starting with the BW on HANA. What other advice do you have here for companies planning on going forward with the implementation this year?
John: Yeah, and I think for those who haven’t implemented HANA yet, my advice is really simple, which is, get started somewhere simple. But don’t unless you’ve got real backing and a real stated direction to do so that don’t try and solve everything at once but instead put a roadmap together that has a simple first step that allows you to get some value because getting something in is the most important thing. You don’t have to solve all of your IT problems with your initial deployment of HANA. And I’ve seen a bunch of people who’ve tried to do that and quite often they end up with a very big IT project and big IT projects are prone to failure and then all of a sudden this shiny new technology you spent money on gets a bad name. And that doesn’t have anything to do with HANA, it has everything to do with large IT projects.
So, I would say start somewhere small, start with a data mart, or start with BW, and get it in and decide on your deployment model, are you going on the cloud or are you going to buy an appliance, and get expertise in-house. This is like all good new technologies, it requires expertise in-house, and get good advice early on across the technology portfolio, so get advice from which hardware vendor, negotiate a good price going forward as you need to buy more and really just focus on getting something in and then build a roadmap for all the other things you’re going to do.
If you’ve built something already and you want to move on, then I guess I’d have a slightly different set of advice, which is build a roadmap and then around that figure out all the things that need to fit into it. Figure out how you’re going to have the skills, figure out your hardware deployment and your disaster recovery and your high availability or enterprise readiness strategy, business continuity, and start to figure out specifically how you’re going to get value out of this after, there are a bunch of places where you might be able to get value out of the HANA platform.
And I wouldn’t be so focused on that if you’re a first-time customer, I’d be focused on getting something in because the value will follow, but once you’ve got something in, you know what specifically did you want to do? Is it something from a reporting perspective like a simple thing like reducing month-end close? Is it something more around logistics? Do you want to improve store distribution times? How specifically do you connect the business outcomes that you’re looking to achieve to the technology platform that you’ve put in? And then get on and do it, that’s my simple advice.
Dave: Ok great. John Appleby, Global Head of SAP HANA at Bluefin Solutions. Thank you very much for joining us today, I really enjoyed our conversation.
John: Thanks, I appreciate it.