Digital Transformation, Part 1: Rapid State of Change

nnovation is a game changer. There’s a new sense of urgency. We are in the middle of a digital transformation and businesses need to face it – or get disrupted. One message that we hear repeatedly when co-innovating with enterprises across the globe is: “We need to accelerate the pace of change and innovation for us and for our clients.”

And at the heart of this change is the cloud.

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But what is digital transformation really about? Have we simply digitized by adopting technology without truly innovating the way we work? Let’s talk about what has changed in business and how a cloud-first and outcome-based approach can help.

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Cloud Myth Buster Summary – the wrap

During the last few weeks we enjoyed demystifying the most common legends about Cloud for you. We hope we turned cloud for you from an indomitable beast into a pet.

Adopting and managing Cloud is a question of knowledge, it´s a question of awareness of risks and abilities. And finally every single customer needs to answer the question himself on how well the cloud provider did his homework to domesticate the beast and unlock the value of cloud for enterprise usage.

Cloud is a catalyst for the entire industry to undergo a significant transformation. With the arrival of this technology, status quo is changing faster than ever and require companies to change and adopt – or go out of business. Every single company needs to find a way to transform the business into the digital age.

We hope we have contributed to a better educated conversation about cloud. Also we wouldn’t like you to miss a summary of our series. here we go:

Myth Buster Summary - Infographic

#1: SAP is not a cloud player

True choice in where and how to adopt cloud based solutions – complimenting new or innovating existing processes. SAP offers customers the freedom to do this in a non-disruptive way. This creates new opportunities for all our customers and helps grow our cloud community every day. We have already cloud customers in 25 industries and 100+ countries all over the world.

Click here for the full story.

#2: SAP software is hard to use

SAP combines its achievements in business expertise over the past decades with the newly emerged focus on people and how they work. Our next generation cloud portfolio is delivered with a “mobile first” development approach and a consumer-like user experience.  Social collaboration is embedded in our product design. And we run hundreds of design-thinking and co-innovation workshops around the globe to engage the end user in our user interface designs. More than 36 million subscribers to SAP Cloud Services experience it every day.

Click here for the full story.

#3: You have to stay on premise or move to the cloud

In 2017, 50% of large enterprises will have hybrid cloud deployments by 2017. Therefore SAP’s cloud portfolio has been designed to serve the hybrid cloud reality. We bring SaaS, PaaS and integration content together to ensure interoperability for our customers. This delivers the freedom to pick and choose whatever creates value for the customer, independent of the technology stack. Cloud Computing will simply become an additional option in a heterogeneous but integrated landscape.

Click here for the full story.

#4: Running mission critical systems in the cloud is not secure

SAP handles data with the utmost discretion and strives to deliver services and support that allow business-critical processes to run securely. SAP is used to work with sensitive customer data for more than 4 decades now. Data security and data privacy stays part of our DNA. We protect our customer data with a defense in depth strategy where all layers are secured, not only our Cloud Data Centers that by the way meet a Tier-4 standard..

Click here for the full story.

#5: Cloud business is not proven

At SAP we are proud that we run our cloud built for Business. Forming the industry’s largest cloud base with more than 36 million end users subscribed to SAP´s cloud services, we are on our way to become the Leader in enterprise cloud business services. We help our customers and partners to gain competitive advantages and realize business benefits in the cloud. A proof point is the Ariba Business Network where more than 1.5 million businesses from more than 191 are connected, transacting more than $600 billion worth in commerce.
Click here for the full story.

#6: Cloud is only for small businesses

Early SaaS vendors focused on smaller companies as their business is often less complex, customer complexity might increase with the size of organization. We also see some industries which are more complex than others, irrespective of the company size. Differences lead to differentiated deployment footprints between On-Premise, Cloud, Managed Cloud and Hybrid landscapes. The entire SAP cloud portfolio is designed to serve various customer footprints and to ensure SAP serves large customers in the cloud with the same completeness and sustainability as On-Premise. This concept created a 70.000+ customer cloud installed base already of which 60% are classified as large enterprise.
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#7: Cloud is all about TCO

Early cloud Decisions were mainly driven by scale and reduction of costs. No upfront investments ( CAPEX ), but ratable payments over time ( OPEX ) lower the risk profile significantly. Beyond TCO, today´s business is driven by Speed and Agility. 52% of the Fortune 500 firms since 2000 are gone as they have been out-innovated by others– This makes Pace of inn ovation the #1 driver for cloud. SAP’s cloud solutions allow an agile adoption of new business models and capabilities, speed up innovation cycles and allow the required flexibility in the structure of organization, processes and IT to stay ahead of the game.

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#8: Cloud can’t adapt to my needs

Stand-alone SaaS solutions deliver simplification, innovation and velocity on the one side and offer a flexible cost structure on the other. Therefore enterprises suffer from the loss of flexibility due to higher standardization of SaaS solutions and accept the control in the hand of the solution provider. PaaS brings back some of the adorable enterprise aspects. With the combination of SaaS & PaaS enterprises have the best of both worlds. Control and flexibility paired with OPEX and Velocity makes SaaS the #1 innovation engine in the IT and PaaS the enabler for large scale enterprise SaaS adoption.

Click here for the full story.

#9: Cloud is hype in consumer-oriented industries only

SAP’s delivers a simplified consumption model that comes with a great user experience to bring the pace back to business that is required to stay competitive. But each industry adopts at own business priorities and own pace. Based on Public Cloud and Managed Cloud environments we see companies of any size and any industry moving their differentiating and non-differentiating processes to the cloud and gaining their individual advantages with a significantly simplified consumption of services.

Click here for the full story.

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So much for busting some of the key myths we have come across in our cloud strategy and co-innovation work. We hope you enjoyed this series and you s tay tuned and in contact with us.

Sven Denecken ( @SDenecken ), Bert Schulze ( @BeSchulze ), Nikolai Vetter ( @NikolaiVetter ), and

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Originally appeared in SCN

Where you stand on cloud security depends on where you sit. Views differ, sometimes sharply, according to the title of the respondent. For example, 52% of business-unit heads say that the biggest challenges they face from cloud computing is ensuring consistent security. CEOs see things the same way, but IT executives (39%) and executives in operations (30%) are less likely to list security as their top challenge.
Why the disconnect? IT and operations have a more granular focus on all aspects of cloud computing, which gives them a variety of things to worry about, from regulatory compliance (a major concern for operations) to avoiding silos in information and business process flows (more of an issue for IT than any other group). CEOs and business-unit heads, meanwhile, are most attuned to the high-level business risks of security problems. This pattern continues as one looks deeper into the survey data. For example, CEOs are more focused on the financial risks of cloud adoption (70% concerned or highly concerned) than are IT executives (58%); CEOs also worry more about brand and reputation risk (62% vs. 54%), while IT is somewhat more concerned with the nuts-and-bolts of regulatory compliance than chief executives. The lesson from these numbers is unsurprising, but bears repeating: Security in the cloud is a
multi-faceted problem that presents issues across the enterprise.

From our paper on protecting the cloud .

Our survey revealed important differences in the ways large, medium, and small companies view mobility.

As the chart above shows, more medium-sized companies are focusing on deploying mobile clouds through areas such as internal productivity, virtual collaboration, and fast time to value for business. Here is a look at a few other ways medium-sized firms set themselves apart in their approach to mobility:

Read more about approaches to mobile cloud deployment in our paper, “Unleashing the Cloud.”

From our paper, “Protecting the Cloud.”

Where you stand on cloud security depends on where you sit. Views differ, sometimes sharply, according to the title of the respondent. For example, 52% of business-unit heads say that the biggest challenges they face from cloud computing is ensuring consistent security. CEOs see things the same way, but IT executives (39%) and executives in operations (30%) are less likely to list security as their top challenge.

Why the disconnect? IT and operations have a more granular focus on all aspects of cloud computing, which gives them a variety of things to worry about, from regulatory compliance (a major concern for operations) to avoiding silos in information and business process flows (more of an issue for IT than any other group). CEOs and business-unit heads, meanwhile, are most attuned to the high-level business risks of security problems.

This pattern continues as one looks deeper into the survey data. For example, CEOs are more focused on the financial risks of cloud adoption (70% concerned or highly concerned) than are IT executives (58%); CEOs also worry more about brand and reputation risk (62% vs. 54%), while IT is somewhat more concerned with the nuts-and-bolts of regulatory compliance than chief executives.

The lesson from these numbers is unsurprising, but bears repeating: Security in the cloud is a multi-faceted problem that presents issues across the enterprise.

Many people see in cloud computing only the people-centric, mobile-first, and analytic-driven applications which can be purchased with a credit card. This would undervalue the transformative power of the cloud.

If your cloud vision is narrowed down to SFA (sales force automation) or even any cloud CRM, then you need to accept that your applications will be siloed and integration with the rest of the business will be ad hoc at best.

A quick fix cloud application can become a long-term business problem when there is no integration between the application and the rest of the organization, especially at a process level.

To truly leverage the cloud for your business, cloud applications need to be considered in conjunction with a modern platform (PaaS) AND flexible integration capabilities. SAP h as taken this kind of holistic portfolio approach (more details ).

Who are the cloud leaders?

Research from Oxford Economics revealed certain companies that are further along in cloud platform deployment. These leaders are more bullish on cloud’s potential to drive revenue and cut costs and more likely to prioritize virtual collaboration as a goal of mobile strategy, to have a BYOD policy, to have launched a managed service offering, and to use a cloud-based mobile app platform in production.

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Will cloud leaders continue to advance and remain ahead of other companies, or will widespread advances across companies close the gap? What will the next set of cloud leaders look like?  Our research suggests that leaders will focus on integrating platforms.

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Cloud leaders are already finding ways to use the cloud to collaborate with partners, suppliers, and/or customers. These leaders are using the cloud to innovate at the pace of business and meet rapidly changing market needs in real time and to participate in networks set up by technology providers. This trend will likely accelerate in the coming years, allowing companies to run more flexible, agile, and cost-effective IT departments and unleashing unprecedented business and IT gains.

Though security issues persist, investment in cloud continues to grow

Though companies are concerned with security breaches in the cloud, many recognize its potential to improve efficiency and facilitate global collaboration. Read more in this week’s cloud news:

Consumerization of IT (CMS Wire): Companies are rapidly adopting BYOD policies—what are the best ways for companies to transition to cloud, and what are the potential challenges of rapid adoption?

Box CEO Aaron Levie Criticizes The NSA, Warns Of Cloud Balkanization (Forbes): Levie argues the balkanization of cloud data laws across Europe could be threatening to business and would get in the way of customers’ needs to share and collaborate with partners outside their region.

Almost a quarter of German companies now see the cloud as very risky, after NSA leaks (GigaOm): A new PwC survey found 22%of German companies now see the risk of using cloud services as “very high,” and another 54% see it as high or very high.

British Business and Transport Embrace the Cloud With Help From Silicon Valley (International Business Times): In an attempt to streamline services, Gatwick Airport and National Rail are using cloud technology to integrate data and IT. The airport’s CIO Michael Ibbitson believes it will significantly improve passenger experience.