SAP promises new emphasis on understanding customer problems

CEO Bill McDermott didn’t exactly promise a kinder, gentler SAP, but he did pledge a company that will be more empathetic to customers, have a more complete vision, and be more focused on simplicity. He also offered a forecast of some trends he thinks SAP will be well positioned to leverage.


Bill McDermott, SAP’s CEO

ORLANDO – On Tuesday, SAP CEO Bill McDermott kicked off the company’s key customer event, SAPPHIRE NOW, with an opening keynote in which he emphasized that greater empathy for customers is critical for SAP’s continued prosperity. He emphasized the importance of empathy within a three-pronged strategy of empathy, completeness of vision, and simplicity. And he tried to articulate how empathy had real meaning that translated into direct results for customers, rather than being simply feeling their pain.

McDermott said that the blurring of the distinction between B2C and B2B markets had created a volatile environment where not only knowledge of your customers – but your customers’ customers – was more important than ever.

“The customer, and the customer alone, determines whether we win or we lose,” McDermott said. “No matter what industry you are in, you are changing business models on the fly. Every company is a software company today whether they realize it or not, because of the way they can generate data and repurpose it for gain. With every encounter with our customers, we have to understand their customers.”

That’s what empathy means, McDermott said – understanding that total modern context of the customer’s business needs. He spoke of a recent meeting he had with the CIOs of some of SAP’s largest customers, who told him frankly that SAP needed to do a better job of listening.

“These customers told me we weren’t empathetic enough,” he said. “We just weren’t listening to their problems, on their terms, on a consistent basis. We have to be empathetic and intellectually curious at all times.”

McDermott pledged to customers that they would see more of this from SAP going forward.

“You will see a more educated, intellectually curious and a more thoughtful SAP, because the bond with that customer and where we need to go to win is what makes us who we are,” he said. “While our technology can be superb, we need to have that relationship there every day.

“Our goal is to demonstrate a level of empathy and passion to you that you’ve never seen before,” McDermott stressed. “This is a company on fire in terms of serving the customer. Customer – Driven – Company.

As testament to this commitment, McDermott unveiled what he termed the SAP Value Assurance, which he said stemmed from a desire to avoid the kind of problems that were created for some customers by the rollout of S/4 HANA.

“S/4 HANA is the core of the company, and the fastest selling product in the history of the company, and because it sold so fast we didn’t really do a good job of road mapping it,” McDermott said. “We knew we went a little fast out of the gates. So today I’m going to commit an SAP Value Assurance to our customers. What does this mean? Every single project will have a planning and safeguarding process. The technical implementation will be world class and we will map it out for you. All this is turnkey.” He also pledged guarantees around migration and functional implementation and innovation and optimization, and indicated several key global systems integrators had pledged fidelity to the assurance: Accenture; CapGemini; Deloitte, Ernst and Young; IBM; PwC and Wipro.

This pledge to provide clear road maps is a major component of the completeness of vision that McDermott promised.

“In 2015, we embarked on a $50 billion investment, deciding it would be a HANA world, and we said we would reinvent the business suite and we have with S/4 HANA,” he said. “We were told customers love the completeness of vision, but they wanted better integration, clear road maps, and being able to tailor it to their business.”

The simplicity is embodied in SAP’s Run Simple catchphrase, but it goes beyond simply streamlining processes.

“We are going for a totally open system with SAP HANA that will integrate easily with our partners, and make business Run Live and Run Simple,” McDermott said.

“Empathy, completeness of vision and simple are the three lightning bolts that I think will change the industry.”

McDermott also indicated some of the areas he sees SAP moving with the industry over the next few years.

“There’s so much around cloud, mobile and Big Data that have yet to happen, and we have to finish the job on these,” he said. “The next 5-10 years will be much more disruptive than the 5-10 we just lived through. Machine learning, artificial intelligence and augmented reality will be critical. I believe these are in our wheelhouse because they impact how you collaborate with customers.”

McDermott said he also sees SAP playing a key role in cybersecurity.

“Cybersecurity will be a driving force going forward and SAP will have a very strong point of view there,” he said. He indicated that SAP would be making both heavy organic – and possible non-organic [acquisitions] moves in security.

“I cannot stress the importance of that enough,” he said.

He also emphasized the need to use the power of technology as it exists today to improve services.

“The one I’m really going to fight for is health care,” he said. “We have an archaic electronic system. I I don’t understand why we can’t put this in a secure cloud that’s aligned to each individual, all seamless and fully digital, and secure. You could take advantage of genome sequencing with access to all this data – and all this technology is here today. I do not want people to be denied the best possible health care, and we have to fight for that.”