IT vendors have been closely monitoring business models and processes, and the way executives capture, store, analyze and apply business data. Software products are designed accordingly, strategies are aligned, billions of dollars are spent to acquire companies, and there are heavy investments in R&D. SAP, a maker of enterprise applications, has moved cautiously along the years, making a late move into areas like cloud and mobility.

Unlike its competitors, who have been acquiring numerous companies of all sizes, most of SAP’s acquisitions in the mobility and cloud space were made in the last four-five years. And SAP has been picky about the companies it acquires — the major ones being Sybase (mobility), Business Objects (BI), SuccessFactors, and Ariba (cloud). Apart from this, SAP has strategic alliances with large vendors like Microsoft and smaller ones like NetBase. Now in its 40th year of operations, SAP has a huge base of ERP customers (190,000 customers worldwide including 4,900 in India). It also has a base of 2 million developers. SAP wants to move its customers from a “system of record” to a “system of engagement” so that they can do “business in the moment.” And its strategy to integrate its social, mobility, analytics, and cloud offerings  is the key to achieving this objective.

SAP has a leadership position in ERP, with a 47.20 percent share of the Indian ERP market (IDC). So when competitors like Ramco Systems and Salesforce.com came along and started offering SaaS-based enterprise software, it started thinking about cloud, and eventually brought out its Business ByDesign (on-demand) portfolio. Today, SAP has solutions for on-premise, on-demand (cloud) and on-device (mobility). In fact, SAP’s business is built on five pillars: cloud, mobility, database & technology, analytics, and core business applications. In the first 30 years it focussed only on core business applications. So, it has achieved a lot in the last 10 years. For this story, we report on SAP’s cloud, mobility, and analytics strategy (SMAC).

Analytics, HANA and ERP

SAP believes the combination of mobility and analytics will be the next killer app in the enterprise. That’s why it spent USD 5.8 billion to acquire Sybase in 2010. Core to its analytics strategy is HANA, an in-memory database appliance that processes records at incredible speed.

Atul Patel, Vice President, APJ, SAP Analytics says, “We just did a benchmark for a 100 terabyte database with 100 billion sales and distribution records — and we ran that on 16 IBM X5 servers costing USD 600,000. We achieved 20 times compression of the database in-memory. It took less than a second to do a BW analytics query. Analytics slicing and dicing took less than a second to two seconds.”

Analysts believe HANA will be the game changer for SAP. It will be the centerpiece in the integration of SAP’s on-demand, on-premise, and on-device solutions. However, there was a time when SAP did not own its own database, and its customers had to integrate its ERP with solutions from Oracle. Eventually, SAP created Business Information Warehouse (BW), which combined data warehouse functionality with a business intelligence platform.

Patel informs us that BW is mainly used for reporting, and customers were looking for a solution that extracts selective data from the database (specific views) to create data marts for specific LOBs (line of business) like HR, Sales, Operations, etc.

As SAP did not have all the components in the enterprise applications stack, its customers began to use a mix of solutions from other vendors, including some of their own customized applications. And that generated a lot of non-SAP data, posing another challenge.

“There was a need to combine non-SAP data with SAP data and create an ODS (operational data store), to extract a report. It has also been a practice for businesses to separate its transactional and analytics data — and to have separate databases for each. It was perceived that mixing the two would impact performance. All this resulted in a number of layers, and now SAP wants to replace all these layers with HANA,” says Patel.

HANA will connect directly with SAP ERP in the back-end, which will further integrate with the mobility and cloud platforms. And this combination will create what SAP calls a “system of engagement” — enabling executives to pull selective data from the transactional data base and do “business in the moment.”

According to SAP, HANA can accept data from legacy databases (non-SAP) and also offers unlimited scaling. It can process both structured and unstructured data. And it offers both OLAP and OLTP capabilities.

Mobile Analytics

Mobile analytics enables one to analyze key metrics and uncover data trends, on-the-go. So, one can instantly share business insights with others. For instance, a retailer will be able to view sales of a particular product for a specific quarter, and then compare the monthly margins for various products. He can also drill down using data from the transactional system in real-time.

This is done using real-time analytics from HANA in the backend, running SAP BusinessObjects Mobile. “People want to see analytics on-the-go, so I think mobile analytics will be a killer application. The mobile analytics solution is available on the app store,” says Patel.

SAP BusinessObjects Mobile presents information from BI or web intelligence reports. It also has the capability to use the information from HANA. For instance, many SAP customers use Crystal Reports and all these scenarios are now available on its mobile analytics platform. So, all Crystal Reports or web intelligence reports built on-premise, are now available on the mobile device. What’s more, SAP has embedded analytics in ERP. “Customers who buy our ERP solution today also get Business Objects. SAP is offering embedded content — with more than 100 reports, mashups and dashboards created using Business Objects. So, if you are in an ERP screen, you will see a Business Objects element embedded. This is called embedded analytics. In addition, you can use this framework to build extra reports on top of ERP,” informs Patel.