Carter Lusher, Chief IT Analyst, Ovum
SAP at SAPPHIRENOW in Madrid made several announcements around its CRM portfolio. The “SAP CRM powered by HANA” announcement is interesting because it bundles together a number of CRM related products with tight integration with the SAP HANA in-memory data and computing appliance. This CRM/HANA solution simplifies deploying a full CRM infrastructure from SAP while leveraging the “fast not just big data” capabilities of HANA. It is an important move for SAP as it illustrates how HANA can be leveraged as the foot-in-the-door product to pull SAP enterprise applications into a non-customer. Another leverage point is the capture of social data into the CRM infrastructure to be analysed by HANA in a time sensitive manner. As a consequence, Ovum recommends that IT managers looking for a next generation CRM solution to evaluate this new SAP solution.
Interesting new solution leveraging CRM and HANA functionality
The “SAP CRM powered by HANA” solution is based on leveraging products, packaging, and pricing product. The solution is basically a bundle of on-premise and OnDemand CRM, collaboration and social (e.g., SAP JAM), mobility, and analytics pre-integrated to eliminate that task while enhancing performance and scale by way of making the HANA in-memory data and computing appliance the underlying data management infrastructure. The goal is to give customers a CRM infrastructure that pulls together all customer data, whether internal or external, that can be used to provide a better customer experience across all touch points in real time. The new solution in essence creates a “fast data” CRM because customer data is in one high performance repository that can be exploited by sales, marketing, service, and ecommerce.
In addition to the new CRM platform, SAP is also launching purpose built applications like SAP Account Intelligence that leverages the in-memory capabilities of HANA. Additionally, there are new classes of consumer-facing applications like Precision Retailing. These out of the box products make it easier and cheaper for enterprises to deploy these functions.
Besides the products and the packaging, this “SAP CRM Powered by HANA” is also a pricing announcement. SAP has promised “aggressive pricing” the solution to increase its attractiveness to enterprises. This makes sense as this CRM/HANA package is an important proof-of-concept that SAP can deliver HANA-based purpose built business solutions that rebut the perception that SAP enterprise applications are both slow in performance and complex in deployment.
While SAP is putting marketing muscle behind the SAP CRM Powered by HANA” announcement, this should not read as a signal that current CRM products. are being dropped. The existing CRM product portfolio of discrete applications will continue to be available and will not require HANA.
SAP CRM leveraging HANA’s customer base as much as its technology
The “SAP CRM Powered by HANA” solution is targeted not at existing SAP enterprise applications customers, but customers of HANA that are not yet SAP CRM customers. This is a logical approach as HANA customers have already demonstrated a desire for high performance data management. Ovum’s analysis is that CRM is a perfect use case for HANA because CRM requires both “big data” and “fast data” functionality (see Ovum’s “2013 Trends to Watch: Customer Relationship Management” where we lay out the case for “fast not just big data).As the volume of data about customers grows dramatically due to social networks and machine-to-machine developments, the ability for marketing, sales, and service business units to exploit all that data in a real time fashion will often require integrated CRM solutions built on high performance computing. So developing a CRM application package that runs on top of HANA should be very attractive to this target market.
However, just as important for SAP is that this solution demonstrates that HANA is coming into its own as a product that that can drive SAP revenues beyond making existing customers’ applications run faster. As Ovum pointed out in “SAP Challenges Competitors at its Annual Influencer Summit,” SAP has high hopes for HANA (e.g., being the number two database provider in the market after Oracle) and the “CRM Powered by HANA” announcement is a proof point that HANA is gaining marketplace traction.
Recommendations for enterprise and public sector manager
Enterprises and public sector organizations should look favourably on this announcement. This illustrates that SAP can innovate in the packaging of its vast array of products and technologies by marrying functionality that makes sense for a specific use case. IT managers looking to deploy a transformational CRM infrastructure that supports a “customer adaptive enterprise” strategy should consider “SAP CRM Powered by HANA.” Yes, this solution is mostly on-premise which might make it seem less “next generation” than SaaS or cloud. However, the combination of functionally along with an unannounced but obvious-to-forecast transition to a cloud-based variation makes it a real contender in the marketplace.
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