Customers who have already invested in S/4HANA may now get the impression they have wasted millions
Some of them may already have got that impression even before this latest round of money-milking.
User groups representing some of Europe's largest industrial businesses have reacted strongly to SAP's decision to double down on its cloud-only innovation strategy, arguing it breaks trust with anyone that invested in the latest on-prem software and asks them to pay double for innovation. On July 20, SAP boss Christian Klein …
"Businesses are facing volatile macroeconomic environments and markets that favour flexibility."
Well he's right in saying that with this diktat the financial environment is going to be volatile. Companies will not know what they are going to have to pay. But he's wrong if he thinks telling his customers "The only way is the cloud." is offering flexibilty. That is a straightjacket for firms who use SAP products.
I also seem to remember SAP saying that firms will have to adapt their business to fit in with SAP's requirements not the other way round.
Who is paying who here?
Repeating the lie "To stay ahead, customers need to be in the cloud. That's the only way to deliver innovation with speed and agility." doesn't help his case either. "The cloud" is not some magical land where the rules of physics no longer apply, what can be done in the cloud can be done on prem... and usually at a fraction of the cost.
If you’ve got data relating to customers on SAP and there’s a damn good chance that you will, then on-prem you have more control of that data. It would worry me that with that data in the “SAP cloud” if the cloud is hacked who takes the GDPR 4% of turnover hit. Personally I’d have it written into the contract in big bold letters that if there is a data breach to their cloud and my data, then it’s the SAP who take that hit. 4% of the SAP €31bn 2022 turnover, unless my maths is borked, is €124m per breach which isn’t chump change. If enough companies did that, SAP might have a bit of think, or not as the case may be given their current intransigence.
Yes! This is effectively exactly the same as Atlassian's removal of on-prem and forcing into vendor-controlled cloud.
SAP's first attempt to implement a web-based ERP was using Silverlight. No idea how much they sunk into that before scrapping it.
For customers, it is hard to imagine a SAP-owned-and-controlled cloud solution being more affordable long term.