SAP’s recent user event in Orlando, Florida, organized and co-hosted by WIS Pubs, drew 1,800 attendees, all keen to learn new developments surrounding SAP’s BI and HANA in-memory analytics offerings. The key theme revolved around HANA as a platform for driving business innovation through technology and process disruption – clearly, HANA continues to sit front and center in SAP’s product strategy.
SAP’s challenge is to accelerate adoption by encouraging, not forcing, undecided customers towards HANA without clear and safe migration paths, but it should remember that its IT buyers are relatively conservative and will consider new technology options and changes at their own pace, not SAP’s.
HANA both creates and solves business disruption
SAP continues to reinvent itself as an innovative software-maker. At this event it emphasized business innovation through technological disruption. SAP’s efforts to position HANA as both technological disruptor and a solution to help companies disrupted by market forces is now bearing fruit (with over 4,000 customers), assisted by a tailwind of business trends favoring rapid analysis of complex Big Data sets.
SAP’s clever “Innovation Factory” analogy – which envisions HANA, physically, as a piece of machinery (i.e. data-processing engine) that ingests raw materials (i.e. data) to manufacture new and innovative products and services (i.e. analytically optimized business processes) – positions HANA as not only an in-memory database, but a platform that allows enterprises to rethink and (re)build core business functions.
However, we feel that SAP missed an opportunity to convince the audience of this during the event’s opening keynote: The anecdotal customer references presented were generally flat and lacked a compelling proposition for HANA’s potential to drive disruptive business innovation.
HANA plays a pivotal role in SAP’s software strategy
HANA, as expected, was the headlining product at the event; almost every new product from SAP has, or will have, a HANA foundation. SAP is aggressively pairing HANA’s capabilities with its applications portfolio. Long term, we see ample opportunity for SAP to integrate and package HANA capabilities into SAP’s vast ERP applications base as a platform for multiple types of transactional and analytic processing in a single database.
SAP also hinted it will integrate HANA into its enterprise information management (EIM) suite to drive quicker data transformations, mapping, and quality routines. Other areas of convergence include mobility, whereby every new mobile solution built on SAP (Sybase) infrastructure will now have (and require) a HANA back end. SAP customers engaging in Big Data and/or social applications will face a similar obligation.
While focusing on HANA to evolve its customer base is understandable, SAP must be careful not to limit growth and/or delay development roadmaps of its core software products just for the sake of HANA integration. One positive is that HANA might force SAP to rationalize the considerable overlaps that exist across its BI portfolio, while simultaneously serving as a lynchpin for integrating disparate tooling.
Analytics remains the most compelling reason to implement HANA
Most near-term business-deal activity continues to be driven by SAP’s BI and analytics customer base, notably its Business Objects and Business Warehouse (BW) customers. This is reinforced by the formal announcement of SAP BW 7.4, powered by HANA and a new in-memory data access/federation layer (called “Smart Data Access”) aimed at simplifying complex data modeling and integration of Big Data stored across BW, Hadoop, and other source data into the HANA engine for lightning-quick analysis.
This means that BW users can port models to the HANA layer – and vice versa – and use the native functionality in HANA for specialized predictive, geo-spatial, and other types of analytics. SAP has branded the capability to incorporate non-BW data (SAP or otherwise) as “In-Memory Data Fabric,” with HANA at the core as a composing layer. Ovum simply chooses to call this a virtual enterprise data warehouse environment.
Architecturally, 7.4 appears solid, and HANA’s original creators did a good job of detailing the engineering technicalities. But this is a bold statement of direction and vision for reinventing BW. SAP will have to ensure it is back-ended by data integration, quality, and metadata management strategies.
Lumira is the poster child for SAP data discovery
SAP’s Lumira data visualization offering looms large in its HANA-enabled BI strategy. Our impression is that Lumira is being primed as the fresh new face for SAP BI, using in-memory processing to drive not only compelling visual insights but also meaningful business action.
To support this, Lumira has infographics capabilities to enable storytelling. Lumira is still an evolving product – 15 releases within 22 months is testament to that – but we expect it to eventually eclipse SAP’s older Business Objects ExCelsius and Explorer products as its leading data discovery offering. However, SAP needs to carefully consider its migration strategy as both older products still command sizable customer bases.
HANA’s goal isn’t just to renew applications, but enable new ones
Most customers today use HANA for analytics. But it is difficult to ascertain the number of live production deployments for hybrid transactional (OLTP) and OLAP (analytic) workloads within SAP’s 800-plus licensed customers for the SAP Suite on HANA. SAP puts the number at 60-plus and claims no one else in the industry is doing this without creating duplicate (i.e. redundant) copies, though IBM might argue otherwise by leveraging its PureData System for Operational Analytics and BLU offerings. Ovum believes that both are taking divergent paths to the same result – for example, in aggressively compressing data in columnar mode for analytics.
The challenge ahead for SAP’s HANA marketing team is to clearly articulate the benefits of a mixed OLTP-OLAP data architecture – not just technically, in terms of reduced database footprint and simplification of data models and application development, but also as an enabler of new business applications capabilities around predictive maintenance, realtime/next-best offers for online retailers, remodeling manufacturing scenarios, and realtime supply chain modeling.
Clearly, SAP’s HANA strategy is starting to influence its entire portfolio. Customers will end up “buying” HANA unwittingly as part of future solutions, but SAP should guard against forcing the market to catch up with its vision before the market is ready or able.