The most important factor here is developing digital skills within the workforce. This is followed by Artificial Intelligence, machine learning and projects around the Internet of Things. The way in which SAP users manage the challenges posed by digitalization, whether through traditional or more novel approaches, and what they need from SAP, was the focus of the 19th DSAG Annual Conference. It ran under the slogan “Business without borders – Architecture of the Future”. It is one of the world’s most important meetings of SAP users.
Digital business processes are, above all, connected enterprise-wide and run in real time – which makes standardized data models essential. Conventional heterogeneous standard solutions are no longer sufficient; the architecture of the future should instead be based on simple, clearly defined functions.
“Here we are calling on SAP to provide us with solutions based on standardized data models, with extensive integration capabilities. Only then will end-to-end processes be truly possible,” explains DSAG chairman Marco Lenck, highlighting the task in hand and the challenge facing SAP.
ERP systems play a critical role in the enterprise architecture of the future. 73 percent of those surveyed view them as relevant and say ERP systems continue to represent the added value within their companies. These systems are becoming hybrid; however, process integration is creating added value between companies outside of ERP systems.
Fewer cloud-only developments
However, the architecture of the future is and needs much more than this. Used intelligently, the cloud can become a genuine innovation driver and, with continuously updated technologies, help companies differentiate themselves from the competition.
DSAG members are already outsourcing marketing and sales processes in particular; 48 percent of survey participants source these from the cloud. The survey also uncovered another significant finding: for the most part, core processes are being left in ERP, with only 10 percent of the respondents moving them to the cloud. Which leads to a further request on the part of DSAG.
“We need fewer cloud-only developments and expect functional developments in terms of maintenance, not a new cloud subscription,” urges Marco Lenck. “Functions within core applications must remain integrated.” Only then can business processes be modeled efficiently.
Open SAP platforms
A fundamental element of the architecture of the future is versatile platforms. They would allow business processes to be rolled out enterprise-wide. Increasing process digitalization makes cross-platform networks essential. What’s new is that these service networks are no longer based on a single provider. For SAP, that potentially means no longer being the only player in the picture.
For this reason, SAP platforms must be open so that they can be easily integrated with other platforms. “Digital processes need independent, interoperable standards,” explains Marco Lenck. “Conversion processes and complex interfaces hinder the speed, and therefore the success, of a company’s digitalization projects.”
DSAG member companies are relying on a variety of platforms: 55 percent of those surveyed consider the SAP Cloud Platform to be highly relevant for digitalization. This is followed by Microsoft Azure with 50 percent and Amazon Web Services with 31 percent. Google lies further behind, with just 15 percent.
S/4Hana and Business Suite: elements of the architecture of the future
As part of the online survey, CIOs and company representatives were also asked about the relevance of SAP solutions for digital transformation. More than three-quarters of respondents gave S/4Hana a high degree of relevance. The SAP Cloud Platform is also up there with 47 percent. SAP Leonardo came in at 30 percent.
More than half of survey participants are planning their transformation with Business Suite as their central system. It is therefore critical that the future development of Business Suite is safeguarded and not reduced or even abandoned in favor of the Cloud.
This year it is also worth taking another look at how companies are making the switch to S/4Hana. 41 percent of survey respondents expect to have completely switched over their systems by 2025, while a further 28 percent expect to be partially complete by then.
“However, not all the promised functions from ERP have been replaced yet. If that doesn’t change, we’ll need some other options for ERP transformation,” says Marco Lenck, looking ahead. As a result, companies are increasingly looking to – and indeed they must – grapple with the complex challenge of building their own architecture of the future. To do this, however, they need a variety of help and support.