facts sap cloud christian klein [shutterstock: 1780247141, Fox_Ana]
[shutterstock: 1780247141, Fox_Ana]
Blog Editor-in-Chief

Facts, Facts, Facts

SAP CEO Christian Klein has his work cut out for him: He has to consolidate a story on SAP’s future for a heterogenous audience. So different are the interests of customers, stakeholders, partners, and the public that he will have to find a compromise.

Stakeholders are usually interested in what promises a return on their investment. Customers want a renewed focus on research and development. Partners want to continue to work with SAP, demanding transparency. The public expects corporate social responsibility. Executive and supervisory board are tasked with orchestrating and consolidating these interests.

One of the most important elements of a coherent story is a solid narrative – some might call it a purpose. And the purpose of a narrative should be to provide orientation and security with facts. Especially now, in times of an upheaving conversion, customers are searching for facts, references, and proof-of-concepts.

SAP’s executive board has more than enough facts for a solid narrative. What they are lacking is a coherent story that combines all of these facts and makes them easily accessible. SAP is currently trying to work more than one angle that seem to be contradicting each other.

Cloud isn’t that easy

In his quarterly earnings reports, CFO Luka Mucic praises SAP’s rising cloud revenue and weaves a tale of imminent growth and prosperity. The figures he projects are astronomically high, which can only mean one thing: The promised growth cannot come from new customers alone. Maybe the rumors are indeed true, and cloud computing is more expensive for SAP customers than on-premises installations.

However, SAP has also recently unveiled an Excel-based TCO calculator for customers’ cloud migration. An example shows that on-premises installations (including initial investment costs as well as five-year operation) in a customer’s datacenter is the most expensive option. If SAP customers entrust the hyperscaler of their choice with their SAP licenses, operation becomes less expensive. But, of course, the least expensive option is SAP’s own cloud.

So, on the one hand, Luka Mucic wants to increase SAP’s revenue by enforcing a “Cloud First” strategy on new and existing customers. On the other hand, Christian Klein promises customers an inexpensive cloud migration and operation. One projects double the revenue, one half the costs. Which one is it?

Facts, facts, facts

No one’s trying to muddle the waters here, the orchestration of the narrative is just lacking. The story Klein and SAP’s executive board are trying to tell should be as fact-based and unbiased as possible, so that it can finally serve its original purpose: To help the SAP community find orientation, to create trust and transparency.

E-3 Magazine December 2021/January 2022 (German)

About the author

Peter M. Färbinger, Editor-in-Chief

Peter M. Färbinger is Editor-in-Chief and Publisher at E-3 Magazine, B4Bmedia.net AG, Munich, Germany. He can be reached at pmf@b4bmedia.net

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