SAP Is Neither Fish nor Fowl

At the annual kick-off meeting in 2022, SAP’s executive board told sales staff that commissions would only be payed for cloud products sold from that point forward. The outcry and indignation were enormous—with the result that on-prem products and services lost their raison d’être. Even if an existing SAP customer wanted to order an on-prem product, SAP sales staff played dumb. This state of affairs was, of course, unsustainable. SAP later found acceptable compromises for the sales department and the problem was then pushed onto SAP partners.

There are SAP partners who very successfully and exclusively sell and customize SAP on-prem products. These partners will lose their SAP partner status at the end of 2022 as on-prem products are slowly becoming obsolete. Next week the partner summit SAP Connect will take place in Hamburg, Germany and SAP CEO Christian Klein will attend in person. Numerous partners want to take the SAP CEO to task because their concerns are no longer limited to SAP’s choice of wording, their choice to use “cloud first” or “cloud only”, but now extend to many SAP partners’ continued livelihood.

However, there is still hope: at the DSAG’s (German-speaking User Group) Annual Congress in Leipzig, Germany, Christian Klein and his fellow board member Thomas Saueressig explained via live feed, that SAP is prepared to think in hybrid dimensions and that on-prem systems naturally also have their place. In view of the figures collected by the user association, the two board members also had little choice. A large proportion of DSAG members want to remain on on-prem systems, even if they are not averse to cloud services in principle. Thus, the discussion focused on the term “hybrid cloud”—but without SAP offering a clear definition of its either-or answer.

SAP is probably still secretly hoping for a resounding success with their cloud service, but this is becoming a distant prospect with the knowledge gained at the DSAG Annual Congress. In a completely overcrowded lecture hall, a Munich lawyer explained to SAP’s existing customers in Leipzig what SAP’s cloud contracts say small print: one day after the end of the contract term, SAP is entitled to delete all data in the cloud. As a precaution, cloud users will have no choice but to withdraw their data from the cloud and back it up with the appropriate advance notice. Which brings us back to the lack of a cloud exit strategy, a matter which E-3 Magazine already addressed two years ago and SAP has so far ignored.

SAP’s cloud strategy is an immature, poorly communicated, and incomplete offer to the SAP community. Resentment among existing customers and partners is high, yet there was no hostility between the DSAG and SAP during the DSAG Annual Congress—though not all DSAG members were willing to sit back. Some displayed more resistance and opposition. DSAG Executive Board member Thomas Henzler gave a much-praised and sharp-tongued keynote address in Leipzig. He touched on the root of the problem and called on SAP to implement more improvements.

However, Thomas Henzler’s critical and constructive stocktaking did not seem sufficient for all DSAG members. At the association’s annual general meeting, some DSAG members called for a much tougher approach to SAP. However, for the time being, the members were unable to agree on what that approach should be. The fact is that SAP is causing a great deal of unrest to existing customers and the community with its no-fish-no-fowl policy on cloud strategy.