"We are allowing our ecosystem to cheat the cloud."

Fighting talk from SAP's vice president of cloud strategy, Sven Denecken, in a thirty-minute interview during yesterday's Innovation Forum event in London.

The "cheat" in question? Getting the benefits of cloud computing without having to forsake the on-premise model. By centering its entire product strategy, both in the cloud and on-premise, on its HANA in-memory database platform, SAP says its customers and partners can choose to run their computing in either location — or both. That massively simplifies integration across the IT estate, he explained:

"The reason for one platform is that data integrity and process integrity does matter. "That's why two years ago we decided all of our platforms would be one platform, all the time. It would also be the platform of our on-premise solutions."

That integrity is allowing some customers to move beyond consolidation or cost-saving to find new business value, he said. For example a company in the oil and gas industry had put the SAP Business Suite and CRM onto the platform and then started using it for seismic analytics.

"They realized with this new platform they could innovate on top. "The technology can help change the business itself — the processes. We're going away from pure TCO discussions."

There has been a surprising level of interest in running the core Business Suite as a managed service on HANA Enterprise Cloud, he said, with a number of customers now developing a budget case for making the move.

Need for speed

In a display of self-confidence in SAP's cloud messaging, Denecken even indulged in occasional sideswipes at the competition, noting that Salesforce.com now encompasses a total of seven different platforms within its internal architecture. Later in the conversation, he contrasted SAP's quarterly refresh cycle with Workday's recent shift to a half-yearly cycle:

"We are staying on a quarterly cycle. Speed is essential."

In part, that need for speed is to complete the still ongoing task of aligning all SAP's existing SaaS offerings onto the HANA platform. Said Denecken:

"We are starting to clear up our own house first. All existing platforms are migrating to that new HANA cloud platform."

As those platforms migrate, they gain from the attributes the new platform brings, he said. For example, moving ByDesign to HANA has brought in-memory processing, predictive analytics and text search to the application. The rumor that ByDesign had been canned, he explained, had been due to poor messaging about the disbanding of a significant in-house resource that had previously been invested in maintaining the separate platform.

The Cloud for Sales CRM solution, also originally built on the ByDesign platform, recently moved onto HANA in a single quarter he said, gaining analytics functionality as it did so. In total there are thirty public cloud applications in the SAP portfolio and when all have completed the migration that will bring 35 million users onto the platform. There will also be new applications, said Denecken:

"Let's keep building a line-of-business portfolio. Let's expand it so if customers want to go cloud they have a full solution."

That objective is in line with a recognition that many companies are now ready to go cloud for specific requirements. Denecken explained:

"We see cloud coming into a level of maturity. Some of the concepts around cloud are proven and companies are starting to embrace it."

Adoption patterns

Denecken sees three adoption patterns emerging for cloud computing in the SAP customer base:

Classical SaaS components that run on top of the core systems, driven by a business case for change. This type of adoption is typically driven by line of business decision makers rather than IT. It is seen across sales and marketing, supply chain, people management and finance, including two-tier ERP.

Private cloud implementations where customers need something much more controllable or unique than a public solution can offer. The buyer in this case is typically an IT solution architect.

Cases that come "under the umbrella of fast innovation." In this case the organization is looking to use a PaaS foundation and a SaaS SaaS style of deployment, as a platform for building innovation.

The key component alongside the SaaS portfolio and the Business Suite running on HANA is the HANA Cloud Platform, a platform-as-a-service offering that includes the HANA database along with a range of other infrastructure and application development services. A repackaging last week aimed to clarify the way that this fits into the HANA landscape. Denecken positioned it as "the glue" that joins the other elements:

"We are fostering innovation on top of that platform — that's a PaaS play ... "We are building extensibility on top of that environment [that] will allow every application to speak in a heterogenous environment."

The new cloud-based packages will also make it easier for developers to get started on the platform, he added:

"In thirty minutes you can run a 1TB HANA system and start coding. "We are lowering the barriers for existing or new customers to tap into our innovation platform."

Disclosure: SAP, Salesforce.com and Workday are diginomica premier partners.

Image credits: Man looking at clouds © ra2 studio - Fotolia.com; Sven Denecken portrait courtesy of SAP.