Techaisle Blog

Open Hybrid Cloud, a strategy for architecting, developing, and operating a hybrid mix of applications, delivering a flexible cloud experience with the agility, stability, security, control, and scale required for digital business transformation, is the North Star for IBM and Red Hat. Open Hybrid Cloud is a computing model that combines the benefits of public and private clouds and on-premises and edge infrastructure. It is a complex paradigm to comprehend, and Open Hybrid Cloud is a multifaceted and challenging undertaking for all organizations. However, one of the critical advantages of an Open Hybrid cloud is that it enables organizations to leverage the power of a partner ecosystem. And empowering a robust ecosystem that delivers Open Hybrid Cloud is the guiding principle of Stefanie Chiras, SVP, Red Hat Partner Ecosystem Success. In a discussion with me, she said, “Red Hat’s strategy on Open Hybrid Cloud is dependent upon our ecosystem; the value of it only gets delivered with our ecosystem. And as we tout the value of the flexibility, the scalability, having a secure, security-focused mindset, being driven by the platform, but that optionality that comes with it is only delivered through the ecosystem.”

Red Hat’s ecosystem initiative is powering on with three key announcements:

1. Red Hat partnership with SAP for RISE with SAP
2. Red Hat partnership with Oracle Cloud Infrastructure
3. Red Hat Ansible Automation Platform on Google Cloud Marketplace

One interesting observation contained within Techaisle’s 2016 SMB & Midmarket Analytics Adoption survey results is the relationship between sales channel and analytics strategy. The survey of 1,116 US SMBs found that a higher percentage of businesses with an omni-channel approach that includes both online and offline sales channels are using analytics than those relying entirely on either online or offline sales. In fact, overall, 85% of omni-channel SMBs are using analytics and 38% are using big data solutions. On the planned side of the equation, another 46% of omni-channel SMBs are investigating use of big data technologies. Even the average spending on analytics by omni-channel SMBs is 3X that of eCommerce only SMBs and 6X of those that do not sell online.

Data illustrates that nearly 60% of SMBs (and almost three-quarters of midmarket firms) employing an omni-channel strategy are already using analytics to track website hits – a rate that is higher than for firms using ecommerce-only, and much higher than for firms that do not use online sales.

Another set of data adds context to this focus on website tracking. Omni-channel businesses tend not to be using particularly advanced approaches to analytics:

• 39% use “descriptive” analytics, and
• 30% have deployed “predictive” or “prescriptive” analytics.

However, omni-channel firms do tend to have some type of strategy – only 5% report that their use of analytics is ad hoc, vs. 13% of ecommerce-only firms and 18% of firms with no online sales.

The current analytics solution deployment & usage differs greatly from future plans within the omni-channel SMBs.  

SAP, Europe’s largest software vendor is ramping up its solutions and marketing strategy to boost its SMB market share. Although SAP claims that 80% of its customers are SMBs (largely due to Business One and the Concur/SuccessFactors acquisitions) it is viewed as a company selling large & complex enterprise applications. Some of us who have been in the IT industry long enough remember heated debates in many business board rooms - “Fire the CEO, CFO or SAP?” - nobody dared to fire SAP. To change that perception SAP has been shaping its SMB lens for a while. In a discussion, almost on cue and pre-empting any question on the topic, EJ Jackson, EVP & GM, SAP Anywhere, said, “SAP Anywhere is a solution focused solely on the SMB space. I know whenever one hears the term SME and the words SAP; many shrug their shoulders or sigh a little because historically SAP has thought of companies with two or three thousand employees as a small company. In the case of SAP Anywhere we are actually looking at companies under 1,000 employees, truly in the 500 and under range where SAP Anywhere is focused at this point in time”.

SAP Anywhere – purpose-built for SMBs

SAP recently launched its SAP Anywhere solution for SMBs. It is a purpose-built unified front office application that combines sales, inventory management, order processing, commerce, marketing programs, mobile point-of-sale, customer support & engagement capabilities in one complete solution enabling multi-channel commerce with a multi-channel marketing platform. It is intended to be a mobile first/digital first solution with a high degree of focus on ensuring that it is low touch, quickly deployable (can be deployed within 40 hours) and easily extensible.

Toby Davidson, VP of SAP's SMB Solutions Group, reinforces the point that SAP Anywhere is purpose-built for SMBs, “…it has been built from the ground up specifically for the SMB market segment. We're not taking a large enterprise application and scaling it down to serve functionalities to the small business. That often doesn't work. What we have done is we have built the application from the ground up specifically for the small and medium business, the sub-500 space in mind for the functionality that's being delivered.”

Let us step back for a minute to understand when SAP’s clear and present focus on SMB began. In July 2014, SAP launched SMB Solutions Group, a division focused entirely on the needs of its SMB customers. The aim of this structuring was to address the technology demands of smaller companies, expand SAP’s own business opportunities as it built momentum into the SMB space. Since then the group has been re-formulating SAP’s SMB strategy and building simplified, integrated business applications powered by SAP HANA delivered via the cloud - squarely aimed at solving SMB business challenges.

Prior to SAP Anywhere, SAP’s SMB offerings included:

• SAP Business One: offering sales and customer relationships, financials and operations through dynamic ERP software
• SAP Business ByDesign: runs entire SMB business in the cloud through a single solution (designed for upper SMBs)
• SAP Business All-in-One: to automate core processes for fast-growing SMBs with industry-specific ERP solutions’ requirements
• Others solutions include SAP Crystal Solutions, SAP Lumira, and SAP Edge Solutions

SAP SMB strategy – loyal customers make it worthwhile

SAP’s strategy for selling applications to the SMB market segment has at best been ambiguous in recent years. Though its products are well designed, the problem has been with their positioning in the market. Its flagship SMB solution, SAP Business One had limited success with SMBs. However, Techaisle’s many discussions with SMBs and midmarket firms in different countries reveals that there are many die-hard SAP Business One users. As one CIO of a 175 person pharmaceutical company in India said, “SAP Business One enables a single integrated visibility to the senior management for effectively running the business operations. Moreover, it consolidates business operations of multiple subsidiaries and offices across country-wide network. SAP has also improved its quality of solution - now we can manage everyday inventory, enable faster sales and purchase processes, perform analysis for business growth, and provide better customer relationship and support”.