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 ).

Switching magically between worlds

Have you ever read a book that takes place in more than one universe or watched a movie in which characters travel between past, present, and future?  Think of Harry Potter approaching the Hogwarts Express via London King’s Cross train station to get over to the world of wizards, or Connor McLeod traveling through the centuries and fighting back the baddies in seamless cuts between the Highlands and New York.

The seamless flow from one scene to the next and the logic of the mechanisms that transport characters between worlds is a fundamental success factor for these kinds of books and movies. If the characters’ travel didn’t make sense, we would be lost and uninterested. We are drawn into stories when the transition logic works well and gates to the future or past are built into the real world with everyday objects.

This analogy often comes to mind when I talk to customers about the cloud. Just as we expect creative and smooth transitions in books and movies, cloud users expect a seamless flow between cloud applications and on-premise or third party cloud–but it’s hard to achieve.

Together, integration & interoperability are the #2  cloud-related pain point (following security), as stated in many research articles like this one recently published in Forbes about .

Integration & interoperability are valid concerns, as cloud vendors often are only able to offer limited:

  1. Experience. We are running the first three miles of a marathon in cloud computing, so there are not many companies in the market who can show successful integration projects on large scale yet.
  2. Business understanding. The early cloud entrepreneurs have been and are still pure cloud vendors. They reflect neither the customer´s on-premise history nor the need to safeguard existing investments–consequently, they prefer a “rip and replace” strategy over integration.
  3. A single hand to shake. Very few vendors deliver cloud (SaaS) solutions + integration tools + integration content + extensibility platform (PaaS) as a unified solution. (SAP is an exception.)

Why integration & interoperability matter

Companies need to avoid information islands and fragmented processes in cloud solutions. Losing enterprise context while moving into the cloud is not an option. Integration across solution boundaries is necessary to prevent application silos. It requires a strategy that encompasses cloud as well as other on-premise solutions. Business users and cloud vendors are acknowledging and responding to this need–a recent survey from shows that 67% of CIOs using cloud applications have already adopted some hybrid tools integrating cloud and on-premise solutions.

Integration is necessary to both business users and IT.

  • Business Users Perspective

Interoperability and integration offer a single source of truth and accurate data; business users can rely on what they see and spend meetings talking about facts and real-time measurements instead of about doubts about data reliability. Faster insights and better decision-making capabilities are what businesses want and need to achieve.

  • IT perspective

A large enterprise runs, on average, between 1,000 and 2,000 applications. Some of the applications will go into the cloud, some are already there, and some may never be migrated. Enterprises adopt SaaS today primarily for commoditized processes such as CRM (Lead2Opportunity, but not Opportunity2Cash), procurement, and HCM (full HCM suite). Companies do not differentiate these processes from their competition and see a value in standardization and best practice sharing. But IT needs to manage governance and control for all of these processes regarding:

    • Data security, privacy,  and compliance
    • Support of complex landscapes
    • Control of data flows
    • Processes working end-to-end
    • Choice of integration technology
    • End-to-end  monitoring and support

What does it require to interoperate cloud solutions?

It is important to separate cloud on-boarding from interoperability.

  • Cloud on-boarding: One-time initial data load from existing systems to the cloud solution
  • Cloud Interoperability: follows on-boarding with continuous upkeep to ensure data is sincrenated and processes are integrated.

Interoperability is clearly superior to the traditional “rip-and-replace” or “stitch-together-with-other-middle ware” approach that many pure cloud vendors take to cloud solutions.

What you should look for in a cloud vendor

  • Point-to-point integration for simpler and highly standardized integration scenarios
  • Integration services that connect systems with pre-packaged integration content in a pure cloud deployment
  • Option to leverage existing infrastructure: On-premise technology and data services with pre-packaged integration content for OnPremise2Cloud via pre-packaged and rapid-deployment solutions
  • Open for re-use of third-party integration providers via a partnership for specific integration scenarios
  • Option to use further third-party integration platforms using our open certification program

Is your cloud vendor considering all of the above? No? Then run away, fast.

Customer Examples…

SAP cloud for customer – A large industrial manufacturer with multiple subsidiaries on different SAP ERP clients needed third-party ERP installations integrated into the flow. The main challenge has been the very tight time frame to achieve a rapid implementation with a small team to integrate accounts, materials, sales quotes, and sales orders.

SAP Cloud for people – A large manufacturing company with SAP ERP, multiple legacy HR, and financial applications worldwide. The goal was a migration from the existing legacy HR system.

    • 120+ third-party interfaces – Integration of third-party cloud solutions
      to SAP Employee Central (EC) and EC Payroll
    • 100% of SAP-to-SAP integration and 30% of total number of required integration covered by prepackaged integration (iFlows)

We learned many lessons with each customer, but the most important has been this co-innovation approach. This is why some SAP cloud releases are up to 80% based on customer feedback: we learn together, and we learn fast.

The SAP cloud portfolio has been designed to serve the hybrid cloud reality. We bring SaaS, integration tools, and integration content together to ensure interoperability for our customers.  At the same time, it delivers on line-of-business AND IT expectations to make them operate together in the cloud.

Focus on interoperability and your business will meet its goals. For further information, download our .

In the closing scene of Highlander, Queen’s “A kind of magic” plays. Cloud integartion and interoperability may sound like magic, but it´s simply the result of four decades of co-innovation between SAP and its leading enterprise business software customers.

Let me know what you think and follow me on Twitter to stay on top of the latest and greatest about cloud computing,

Regards @SDenecken

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Read other relevant blogs:

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- Cloud Extension program

Notes: Original blog appeared on SAP SCN community.

At SAPPHIRE NOW I had the pleasure to participate in a podium discussion with my colleague (member of SAP´s management board) on the topic of clouds, particularly about the differences between public and private cloud. Our experiences co-innovating with customers and partners came out in the discussion.

There are many definitions of public and private clouds, and I think a little simplification is in order for the purpose of this blog. (This is where some of the cloud purists will jump up and down).

1. Private cloud – hosted solutions, often managed by a partner or vendor

2. Public cloud – multi-tenant solutions, managed by the vendor

We know that the move for our customers to the cloud must be a thoughtful evolution. Our strategy centers on leveraging the right mix of cloud, hosted, and on-premise technology. Customers have very specific challenges they are looking to solve and very specific investments they want to leverage. Their starting point on this journey will help define the mix that is right for them.

(predominant deployment models)

But now, lets focus on cloud.

The current heated discussion about cloud security reminds me of an interesting recent on cloud computing from Saugatuck Research. Not much has changed when it comes to customers and the way the cloud is perceived.

Security was and is top of mind for everyone, and rightfully so. I agree with Saugatuck´s conclusion:

Saugatuck believes that the reality of Cloud IT is actually the reverse of popular thought. I believe the growing prevalence of Cloud IT use, including communication and interaction throughout multiple “Internets of things,” can deliver vastly improved security that reduces the risk of data loss and system breaches by improving the ability to secure, monitor, and manage devices and software.

See detailed research here:

Security is the #1 concern for enterprise organizations when making a cloud decision. This issue has been aggravated in our post-Snowden/PRISM world. Security is a serious topic that requires thoughtful discussion.

There are many pressures along the security isobars of IT, and space for value- and business-oriented conversations about cloud services that help businesses become more agile and insightful are necessary.

The SAP Cloud Strategy and Customer Co-Innovation team regularly meets customers to discuss expectations, opportunities, and concerns. Many roundtables, forums, user group meetings, and expert sessions with organizations in various countries helped to shape the thoughts in this blog.

Here is a look at the 3 most important lessons we have learned from our experiences and interaction with customers.

In an extensive interview with Boersen-Zeitung (Germany) on July 19, Werner Brandt, CFO of SAP, said he did not believe cloud computing was at risk from the debate about US secret service activities. He said, “Safety has always played an important role for us, both for on-premise software and for the cloud. We fulfill the highest EU standards which guarantee the safety of our clients’ data both from web attacks and from attacks in the cloud. We are the only global vendor of cloud applications with data centers in all world regions and the ability to tell clients that their processes run on servers based in their own region. We have not seen that the current data security has had an impact on our sales. We’re the fastest-growing cloud vendor. We expect cloud revenues of €1 billion for 2013, and we continue to aim for €2 billion in revenues by 2015.”

We have talked here about the fact that security is the top challenge companies face with cloud computing, and this chart brings that fact home in a powerful way. The image is from our paper on cloud security, .

“While there is a tremendous opportunity for CIOs and other top executives to be champions and brokers of cloud computing, there are also tremendous compliance and security risks that line-of-business executives don’t want to handle—and many aren’t equipped to deal with.”

–John Considine, Chief Technology Officer at Verizon Terremark, in our paper on cloud security, .