SAP Sapphire 2023

The Six Five team discusses SAP Sapphire 2023.

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Daniel Newman: Let’s start off talking a little bit about SAP Sapphire 2023.

Now, we were moving, shucking, and shaking that week. I was at Lattice Semis Investor Day. I also went to ServiceNow’s knowledge event and I was virtually attending SAP Sapphire. SAP Sapphire had a big conference this year. Christian Klein, CEO, kicked it off and really focused on business AI. So as we’ve heard generative AI come to the surface, and we’ve heard that term come to the surface, I think the big inflection for all of us is, “Okay. These big large language models are table stakes now. We’ve already heard Google and Microsoft say they don’t necessarily have a moat with their big chat solutions for the open internet,” but we’re all leaning on a common narrative that the business or enterprise AI opportunities are huge.

We went to IBM Think. We came back with WatsonX. Well, SAP Sapphire’s event was all about business AI. So the company really did want to focus in on telling a story to say, “Hey,” across the massive ecosystem of customers, hundreds of thousands of SAP customers that they are building what they’d like to call AI for business.

A couple of things that I took note of that were important. First of all, the company was really big about partnerships at this year’s event. So they announced partnerships with Microsoft and they announced partnerships with Google. So they’re going all in on choose your own adventure as it pertains to connecting to the public cloud. Now, remember, SAP is all about platforming, so you can use the public cloud of your choice and they’re not necessarily looking for you to, well, you can’t use any hyperscale infrastructure as a service from SAP. So that was the first thing that they were doing.

They were also very focused on their sustainability footprint through generative AI. They were basically saying that they extended to have their generative tools help companies manage carbon better, and that’s been a big part of the SAP story is the sustainability footprint management, which is going to be a new tool. It’s something that they launched at this year’s event.

Then I think the third thing that was really interesting was they did announce a very cool Microsoft 365 co-pilot Viva Learning extension with SAP success factors. So as you know, one of the great applications, I think, for generative AI is going to be HR. You have the ability to understand and profile the employees and personnel in your organization. You can create deterministic factors of success and less likelihood of success to help identify better candidates, to be able to more immediately address skilling, to have more successful review processes, and to make sure that we’re putting people on the right path.

We know that retention of talent is a huge issue in this world, and so AI and generative AI and the tools that it could create seem to have a really big implication there, and taking SAP data and combining it with what Microsoft is doing and success factors together was a great example of an AI for business use case.

By the way, this seemed to be thematic throughout the whole event. So the company’s focusing on its BTP, business technology platform, adding AI capabilities, delivering on partnerships, creating generative tools that are going to be based upon a rich set of meaningful proprietary data, and that’s where generative AI is going to really show its value in the enterprise.

Last thing I’ll say is I believe SAP has created a nice moat in terms of architecture with business AI because it seems like everyone else is saying enterprise AI, and I like the idea that maybe SAP can really hug the business AI line and utilized that as something that’s definitive to SAP’s value proposition with putting proprietary data plus AI, plus open source large language models together to drive meaningful productivity and better outcomes for business.

Patrick Moorhead: Gosh, you did a great summary there. At the show, SAP wanted to make the case, and I think it did a pretty good job that, “Hey, we’re helping customers transform their business models in the cloud, get greater visibility around sustainability, and improve supply chain resilience,” and around that was this required adder for AI. There’s nothing new about AI, but what’s new is implementing it for hardcore business applications and also using the recent generative AI to do that.

So whether it’s ERP, whether it’s digging into that in the supply chain, I liked some of the examples that AI is using. So for instance, predictive replenishment as an example, intelligent product recommendations. Obviously, SAP has a pretty big HRM system with success factors and talking about improvements to align people with projects, people with opportunities. That just makes total sense. Again, while AI is not new, I think integrating it with the veracity that these companies are headed to on private content as opposed to the Encyclopedia Britannica, I think, is big.

I don’t think we scratched the surface with companies’ desire to get around this, not only to deal with the short term financial headwinds that they have, but even looking in the future how they can get advantages on their competitors and serve their customers better. Working on a writeup. Should be out next week. So check it out.

Author Information

Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.

From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.

A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.

An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.


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