After delivering strong Q2 2016 earnings results today, SAP vowed to aggressively train its partner ecosystem to support SAP S/4HANA -- the company's flagship in-memory ERP business suite.
During an earnings call with Wall Street analysts today, SAP CEO William McDermott and other executives described a long-term channel strategy to accelerate S/4HANA adoption. "This is a multi-year upgrade cycle opportunity," says McDermott. "And if you think about us slightly less than 10% into that journey, you can see a lot of runway that's still left in the business model just on the upgrade cycle."
"We are really focused on getting our partners trained, more than 5,000 really trained," adds Rob Enslin, president of SAP's global customer operations and an executive board member. "We'll have close to 10,000 by the end of the year."
S/4HANA Customer Adoption
Still, faster adoption of S/4HANA won' happen overnight. Go-live deployments require between six months to nine months, Enslin says. That's "a lot faster than anything else in the marketplace," he adds.
Key partners include Accenture, which is also a HANA customer.
"SAP and Accenture have a longstanding and strategic partnership," McDermott notes. "This includes the recent agreement related to jointly accelerating the development in S/4HANA Enterprise Management solution and industry solutions, as well as extensions built on the HANA Cloud Platform. Accenture already runs its business in production on HANA."
Overall, SAP's business appears to be performing well. SAP’s Q2 operating profit was far ahead of Wall Street’s expectations, the company reported this morning. The company’s cloud subscriptions and support revenue rose 41 percent in the quarter.
SAP SMB Channel Push
Looking ahead, it appears that SMB cloud revenues — involving channel partners — will be a major emphasis. The company in June named Barry Padgett as SAP’s first-ever SMB Solutions president. And in July, SAP launched a Concur channel partner program. VP Meaghan Sullivan explained the SME (small and midsize enterprise) channel partner strategy in a May podcast with CompTIA and ChannelE2E.
McDermott also pointed to a growing cloud SMB push, led by Steve Singh, president business networks and applications. (Padgett, by the way, reports to Singh.)
Notes McDermott, "We moved over small, medium-sized enterprise responsibility to Steve with our cloud portfolio of products because we're massively concerned with (A), the cross-sell capability coming from the S/4HANA world and (B), all kinds of net new customers that we can work through a channel that SAP was not that well represented in."
Added Singh, "I think we have a tremendous opportunity to deliver a full suite of integrated services, of cloud services that allow our customers to run their entire business, everything from the ERP suite to the line of business applications, and delivering that to not just the Concur channel, but even as we continue to build out our channels for our midmarket ERP business and Ariba, Fieldglass, and SuccessFactors businesses. So, this is – we think this is a huge growth opportunity in the years ahead for SAP."
