While Seeburger follows a unique approach with its Business Integration Suite, the idea of a digital platform is not exactly a novel concept – and yet, German industrial companies are struggling to adapt to the digital platform economy. This is the result of a representative survey of 502 companies commissioned by Bitkom.
“When we hear ‘digital platforms,’ we often only think of online retailers like Amazon or eBay, or service providers like Airbnb. However, especially for German industrial companies, digital platforms offer a tremendous opportunity to ensure continued business success in a digitized world,” explains Bitkom’s CEO Achim Berg, adding, “The surge in platform offers can be attributed to the rise of Industry 4.0 and the Internet of Things (IoT). Doing nothing means voluntarily relinquishing market shares. German industrial companies should try to stay ahead concerning platforms.”
Seeburger seizing the opportunity
SAP partner Seeburger has seized this opportunity and developed an open platform for digital transformation – the Business Integration Suite.
“Digital transformation inevitably leads to a sharp increase in the number of platforms and systems in a company’s IT landscape,” said Michael Kleeberg, co-CEO of Seeburger. He described the current situation. “Because of their inflexibility and slowness, monolithic architectures and solutions will become insignificant or redundant as they are replaced by more flexible, more suitable solutions. More and more companies continue to opt for cloud-ready or cloud-native approaches since such solutions offer enhanced flexibility and speed.”
Does that mean new concepts or business processes can be established faster? Do projects require 1,000 man-days of effort, as is often the case with monolithic landscapes? Or can digital capabilities facilitate rapid implementation? Kleeberg knows that customers need to adapt to fast-changing market requirements to remain successful, and he knows that this capability depends on the flexibility and speed of the underlying digital infrastructure.
“We think that manufacturers trying to keep customers locked in to their own closed-off ecosystems is counterproductive,” Kleeberg said. “One manufacturer is usually not able to provide the best possible solution covering all necessary departments, technologies and applications. Open architectures are in the best interest of customers. Our BIS platform offers a foundation to establish this flexibility and speed.”
Companies struggling with digital platforms
Decision-makers in industrial companies are aware of the clear benefits of digital platforms – and yet they are hesitating, as Bitkom pointed out in its recent survey. Bitkom’s Achim Berg confirms, “Digital platforms open up tremendous possibilities.”
However, only 16 percent of respondents indicated they had a team responsible for digital platforms. Achim Berg added, “Companies without anyone responsible for digital platforms will struggle with significant blind spots. No company can afford to simply ignore digital platforms.”
SAP has its own specific, less open platform idea: increased agility means less seamless integration with existing SAP products. Even though completely different technology-wise, SAP’s and Seeburger’s concepts are somewhat similar.
“Our corporate technology platform connects Hana and its analytics functionality with the SAP Cloud Platform, enabling customers to make sound, reliable decisions,” explained Juergen Mueller, Chief Technology Officer and member of SAP’s executive board, at TechEd 2019 in Barcelona. “SAP ensures openness and flexibility through preconfigured integration, modular architectures and easy expansion in cloud, on-premises and hybrid models.”
In the context of digital transformation, talking about platforms almost always refers to digital platforms. Matthias Fessenbecker, Chief Technology Officer of Seeburger, explained, “Technologically speaking, digital transformation means an explosion of data. Such a huge amount of data is a goldmine if companies know how to extract valuable information from it,” Feßenbecker said. “To do that, companies need a lot of processing power. Traditional IT systems and databases were never meant to withstand such an onslaught of data. New solutions become necessary – new solutions like digital platforms, for example.”
Digital platforms adding to ERP systems
Digital collaboration in the form of digital ecosystems also need a technological foundation that wasn’t available until now.
“Digital platforms do not replace a company’s ERP suite,” explained Fessenbecker, adding, “Furthermore, digital platforms are mostly offered as cloud services – which makes sense, since they require a lot of resources and should therefore never be an afterthought.”
SAP is also trying to follow this approach, but its strong focus on its own applications means its solutions are not nearly as open and agile as Seeburger’s Business Integration Suite.
Through combining various SAP technologies into a stack with a reference architecture, the SAP platform provides companies with much-needed services. The platform consists of database management, data governance, application development and integration, analytics, intelligent technologies and services.
Fundamental principles of Seeburger’s BIS
In conversation with E-3 Magazine, Seeburger’s co-CEO Michael Kleeberg explained the fundamental principles of BIS as follows, “A platform is supposed to provide a unified foundation for completing specific tasks. This means that a platform always has a specific predefined purpose depending on the tasks it is supposed to support. Platforms like R/3 and S/4 first and foremost support business-related tasks and functionalities like FI, SD or MM. An integration platform like Seeburger BIS, however, enables and supports integration tasks between systems, applications and business processes. This integration is a core discipline of digitalization because important business processes have to be supported by IT or aren’t even possible without IT support.”
In the aforementioned survey, Bitkom also indicated that the importance of digital platforms will only increase in the future. Nine out of ten companies are convinced that in ten years, digital platforms will be very or somewhat important for the global and the German economy.
“Companies recognize the growing importance of digital platforms and want their number in Germany and Europe to increase as well – but few also recognize the need to establish them in their own companies,” said Achim Berg.
Not only are digital platforms like Seeburger BIS technological and organizational solutions, they also solve business challenges. “For example, a decision-maker in finance will recognize the importance and value of platforms in times of increasing digitalization of business processes,” said Axel Otto, Chief Financial Officer of Seeburger. “In the past, customers were only able to choose a monolithic ERP system. Now, platforms enable them to build their own system landscapes according to their specifications and requirements. This also affects our customers’ investments and costs.”
Customers looking beyond SAP to fulfill IT needs
For the past few years, there has been a shift in the SAP community towards more ‘democracy’, meaning that many SAP customers are looking beyond SAP to fulfill their IT needs.
Otto explained, “By using platforms, our customers can now effortlessly combine solutions of different providers. They are able to choose which solution best suits their needs, and they are able to separately manage the chosen solution. Consequently, this newfound freedom of choice enables customers to directly influence costs with their decision. It is also possible to first evaluate what priority a topic has for the company.”
With such a diverse ecosystem, the SAP community is struggling to define numerous buzzwords and product names. Seeburger’s platform is called Business Integration Suite – but what’s the difference between a platform and a suite?
Martin Kuntz, Seeburger’s Chief Cloud Officer (CCO), explained, “Business Integration Suite is an umbrella term for all our solution offerings. The BIS platform acts as technological foundation for completing specific tasks and projects. The value of our suite is determined by its content – whether that means preconfigured industry solutions, processes, mappings, or comprehensive cloud services and SAP add-ons.”
Co-CEO Kleeberg added, “Following this approach, customers leveraging our Business Integration Suite can quickly and easily add more content to their solutions.” Consequently, Seeburger’s customers are able to complete various integration tasks on their platforms.
Skeptical SAP customers might say that they already have a suite – SAP Business Suite 7. Why would they need Business Integration Suite, then? “The term suite doesn’t define the content,” explained CTO Feßenbecker. “Seeburger Business Integration Suite offers solutions for business integration, meaning that it specifically pertains to the integration of business data and all necessary applications and business partners.”
In contrast, SAP Business Suite 7 offers ERP, CRM and SCM functionality but not the integration of the business data stored in these applications with business partners or non-SAP applications and cloud services – which has frequently been the subject of SAP customers’ criticism.
Therefore, SAP’s and Seeburger’s suites complement rather than compete with each other. CCO Kuntz added, “One could even say that the integration of products of different service providers has never exactly been SAP’s focus.”
Specialized tools naturally are the best fit for specific tasks. Co-CEO Kleeberg said, “When tackling integration challenges, it is more in the customer’s best interest to leverage integration platforms instead of trying and failing to achieve the same functionality with tools that were never meant for these tasks. Of course you can boil an egg with a torch, but what good does that do?”
Seeburger’s BIS highly flexible and specialized
An ongoing discussion in the IT scene is the challenge of breadth and standardization (horizontal) versus depth and specialization (vertical). Seeburger’s Business Integration Suite is characterized by high flexibility and breadth. Does this come at the disadvantage of necessary process depth?
“No, we do have the necessary process depth – in fact, this is an important differentiator for us in the market,” said Axel Haas, co-CEO of Seeburger. Kleeberg added, “We offer sustainable process depth thanks to our in-depth industry knowledge in retail, automotive, and more. We offer our customers ready-made solutions, i.e. content, for the process-specific integration challenges of their industries which can be used immediately and out of the box.”
In the German-speaking SAP community, there have been extensive discussions on whether the future will be in the cloud or remain on-premises. This naturally poses the question: is Seeburger’s Business Integration Suite an on-premises or a cloud solution? And what do Seeburger’s executive board members think SAP customers currently prefer?
Co-CEO Michael Kleeberg replied, “Seeburger’s Business Integration Suite is both. Customers can purchase the software as a classic software license with a maintenance contract or as a software subscription for on-premises operations. Alternatively, BIS can also be booked as a cloud service.” Customers can choose between iPaas – Seeburger operates and maintains the software – or Full Managed Service – Seeburger takes care of all tasks including daily monitoring and change management.
“We service many SAP customers. Some larger companies prefer public cloud providers like AWS or Microsoft Azure. I’d say this is the new on-premises model. We also offer our full-service portfolio for this use case,” said Kleeberg. Axel Otto added, “In fact, our cloud offering has been doing quite well these past couple of years. In this segment, we have been growing more than 20 percent year over year.”
Seeburger and SAP: Partners rather than competitors
Finally, a question for all of Seeburger’s executive board members about the market: How have analysts and SAP customers typically reacted to the suite and platform offering of a mid-sized company like Seeburger compared to offers of major cloud companies like AWS, Google, Alibaba, and Microsoft, or software providers like SAP, Oracle and IBM?
“Major cloud companies and well-known software providers like SAP aren’t our competition but rather our partners,” explained co-CEO Axel Haas. “For example, AWS and others offer IaaS – Infrastructure as a Service. Should they require it, customers can operate the Seeburger BIS platform in such an IaaS cloud – even enjoying 24/7 management of BIS.” This makes sense for customers already operating their ERP landscape in such a public cloud.
Haas added, “We have partnerships with all the software providers that you mentioned because we complement each other perfectly well. This is especially true for SAP, as our decades-long partnership shows. SAP focuses on applications for digital transformation, we support customers in integration challenges.”
Seeburger co-CEO Kleeberg emphasized, “For specific integration tasks, Business Integration Suite offers more process depth than established generic offerings from major cloud companies. With BIS, customers can obtain preconfigured integration solutions, i.e. content, for their specific industry requirements.”
What do Seeburger customers usually say about the offering? “They appreciate our partnership and collaboration,” CTO Fessenbecker recalled from numerous BIS implementations. “This doesn’t only pertain to our mid-sized customers, but also and especially to our enterprise customers. We offer customers support they cannot get anywhere else. Which major cloud company offers customers the possibility to talk about requirements and challenges with executive board members and CEOs, for example?”
His management colleague Kuntz added, “We have about 1,000 employees – which benefits us more than some might think. We leverage agility whilst remaining intensely focused on the topic of integration. We are able to offer broad, comprehensive functionality with our BIS platform. SAP customers and analysts appreciate our expertise, as our position in the Gartner Magic Quadrant proves.”
Otto concluded, “Over the past few years, we have successfully positioned ourselves in the market. We have been operating for more than 30 years, and over 10,000 customers have put their trust in our solutions. At the end of 2019, we surpassed the 1,000-employee mark for the first time. Many of our customers have been with us for many years. We only offer solutions if we are absolutely sure that we can deliver the performance and scope as promised. This is one of our most important values and the reason why so many customers have put their trust in us.”
Thank you to all members of Seeburger’s management for speaking with E-3 Magazine.
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