Are SAP’s Layoffs Due to an Impressive Transformation?

Executive Summary

  • SAP’s has come up with a logic for key layoffs in areas where their products are failing.
  • We analyze the evidence for SAP’s logic.

Introduction

After we wrote our analysis of SAP’s layoffs in the articles SAP’s Layoffs and a Brightwork Warning on HANA, and What Is Different About the Q1 2019 SAP and Oracle Layoffs, we found the article Five Questions with SAP CTO Juergen Mueller on the SAP website that provided SAP’s explanations for the website.

Let us see how SAP’s explanations hold up.

The Quotations

An Impressive Transformation?

“SAP News recently had the opportunity to speak with Juergen Mueller, chief technology officer and member of the Executive Board of SAP SE, on some of the important topics facing SAP and its customers and partners.

Here is a transcript of the conversation.

Q: Thanks, Juergen, for making the time. It’s obvious to most that SAP continues a rather dramatic and impressive transformation. There’s always speculation about what every announcement means about the company’s priorities. What’s your take on where SAP is today?

A: Personally, I believe SAP is in a very exciting position today. By any measure, we have assembled a comprehensive end-to-end portfolio of business solutions. We serve large and small customers in every industry in nearly every country. The key for us right now is to show two things: consistency and innovation. Innovation is an obvious requirement. I also stress consistency because just last year we introduced a significant strategy to deliver the Intelligent Enterprise.

Our customers need to see us continue to focus on this strategy, especially showing that our analytics and machine learning capabilities are infused into all of our business applications. The key here needs to be business value. What can a customer that runs SAP do as an intelligent enterprise that they could not do before? How can the SAP user community be leaders in their companies by connecting the operations to the experiences? I believe we have a strong technology story to tell, but this will only resonate if we help customers demonstrate the business value they achieve with SAP. There are so many of these stories to tell and we need to constantly put the customer success first beyond our own soundbites.”

Our Analysis

SAP has layoffs in many of the areas in which SAP has been unsuccessful. SAP Cloud, Leonardo, HANA, etc.. If the demand had materialized for the offerings, the layoffs would not have been necessary. However, SAP makes a claim that we have not seen made anywhere, which is that the layoffs are not layoffs or a sign of weakness in the layoff areas, but instead is an “impressive transformation.” The term digital transformation, which is a fake term that we covered in the article The Problem with the Term Digital Transformation, has led to the trend of companies calling any change or any setback as a “transformation.” SAP also claims that this is “obvious to most.”

Well, it is not obvious to us, and we can’t even recall a single comment putting this spin on the layoffs. Rather than being obvious, it is entirely counter to our conclusion about the layoffs. And this is PR. PR is how you try to get ahead of a story and try to shape the narrative around the story.

Mueller then begins his answer with sort of boilerplate motivational speak. And he immediately begins by emphasizing the importance of innovation. What is curious is that the layoffs themselves show how lacking in innovation SAP has been. The evidence for innovation at SAP is extremely weak.

Here are a few examples.

  • We have documented how HANA, a database that is highly touted by SAP for innovation was based upon two acquisitions (acquisitions are not innovation) and how SAP has simply backward engineered other databases as covered in the article Did SAP Just Reinvent the Wheel with HANA?
  • There is also a complete lack of innovation in SAP Cloud, which will now simply be a system to upcharge customers for AWS/GCP/Azure as we covered in the article How to Understand SAP’s Upcharge as a Service Cloud.
  • S/4HANA is not at all innovative. It is a technical “rejiggering” of ECC’s backend, that increasingly looks like it will be implemented on premises without Fiori.

Then Mueller goes on to discuss machine learning, which many vendors also claim, but is really just a bubble that will be popping shortly. If you look at SAP’s machine learning claims, you find that SAP has simply added some standard machine learning algorithms that it had nothing to do with developing to a few of its products, but it charges for them when they have been available for free for decades. We covered this topic in the article How Real is the SAP Machine Learning and Data Science Story? Any customer who is purchasing “machine learning” from SAP should contact us because you can get everything SAP is selling in ML for free. You just need to know how look for those items online.

It seems that SAP’s definition of innovation in ML is to sell publicly available ML algorithms.

Overall the first answer by Mueller is more of a diversion away from the question rather than any type of observation about the layoffs — which again, are not called layoffs in the question, but an “impressive transformation.” As in Orwell’s 1984, War is Peace.

Do the Layoffs in HANA Point to Problems with HANA?

“Q: One quick follow up on your statement about SAP’s technology story. There is some speculation in a few places about the future of SAP HANA. You just became the leader of all SAP technology and innovation a few weeks ago. What is the future of SAP HANA?

A: To be candid, anyone who questions our commitment to SAP HANA doesn’t understand the strategy of SAP. We just named one of our brightest engineering leaders, Gerrit Kazmaier, to oversee the roadmap for SAP HANA data management.

The reality is that SAP HANA has been wildly successful for SAP and for our customers, with more than 28,000 customers on the SAP HANA platform. Almost all of our SAP applications, including SAP SuccessFactors solutions, make use of SAP HANA now. This turns it into one of the largest scale — if not the largest scale — enterprise application database.

Given the scale it has achieved already, we look to constantly build on the past success by introducing new SAP HANA offerings. We will make some major announcements about SAP HANA at SAPPHIRE NOW in a few weeks.

Honestly, I read some of these articles and they are basing assumptions about SAP HANA on a restructuring program that was announced earlier this year. I don’t want to minimize the anxiety that a restructuring creates for employees who are impacted. In cases where individuals make comments about their feelings or they question specific decisions, this is understandable. Personally, my hope is that SAP or our partners retain as many of these colleagues as possible. The facts about the strategy itself are what I have explained here. The restructuring is designed to invest more of our resources in areas where SAP customers tell us they expect us to invest. New SAP HANA innovation is one of those key priority areas.”

Our Analysis

Well first off, it is unclear who actually understands SAP’s strategy, as the following graphic explains.

Blaming people for not understanding what SAP’s “strategy” is, is not a true critique if the strategy is not knowable. This is a constant feature of SAP messaging, that if their behaviour appears erratic or illogical, the fault lies with people that “don’t understand ABC or XYZ. Sometimes things just don’t make any sense. 

Loosely stated, it seems to be “get involved in a lot of stuff.”

As we have covered in articles like Why Did SAP Stop Reporting HANA Numbers After 2015?, HANA’s growth plateaued in 2015 when they switched the narrative to S/4HANA. HANA is an extremely expensive database with no differentiation in the market How Were SAP’s Claims True if HANA is Now Not a Differentiator?

SAP Can Not Afford to Continue to Invest What it Has in HANA

This means that SAP is not receiving a return for continuing to make HANA the primary marketing tentpole that it once was.

We covered in the article HANA’s Time in the Sun Has Finally Come to an End in mid-2018 that SAP would reduce its marketing and development and overall investment in HANA because it did not make sense to continue to do so. Now, less than a year later, SAP is doing what we predicted they would do, but we have been told to please not emphasize this fact. Accenture, Deloitte, Infosys and Gartner, along with every HANA resource would rather not have it published that all the information they have been telling their customers about HANA has been false.

Therefore, while HANA is not going to be discontinued as a product, it is not going to receive the same emphasis or internal resources as it did in the past.

Meuller tells several lies in his response.

  • The fact that SAP promoted a new individual to a position in HANA does not mean anything. It has not mattered who had that position in the past because HANA’s design objectives are illogical because they were initially set by Hasso Plattner who was unqualified to design a database.
  • HANA is not live at 28,000 companies. It is owned as a license by that many companies. HANA does not have more than roughly 8,000 live customers. How do we know? Well, SAP’s stopped reporting live customers in 2015 for a reason.

iDataLabs makes its money by selling data to salespeople. Unlike SAP, they have no incentive to overestimate or underestimate HANA’s usage. This means that even with all of SAP’s marketing push since 2011, SAP was not able to make HANA anything more than a niche database. 

  • SuccessFactors is on HANA?: SAP customers are not live on SuccessFactors on HANA. SAP is still testing an internal version of SuccessFactors on HANA as we covered in the article Did SAP Move SuccessFactors to HANA?
  • Analysis of Layoffs is Too Narrow?: Our analysis, which Mueller may be referring to as our articles on SAP’s layoffs have been very widely read, and we know they have been discussed within SAP as they did not provide the desired spin on the layoffs, is not simply based upon the layoffs alone. They are based upon field reports related to HANA and based upon years of research into HANA.
  • SAP Does Not Think Enough of HANA’s Prospects to Maintain a Large Contingent of HANA Resources, but Thinks Their Consulting Partners Should?: There is little reason to retain a good part of the HANA resources if HANA is never going to meet the projections that the company had for it. Consulting companies keep resources staffed for one reason, to be able to staff those resources. When one of the top resources in HANA in SAP, Thomas Jung, states that he wants to leave HANA to get “closer to his ABAP roots” that should tell you something about HANA’s future.
  • HANA’s Future Priority?: We can’t predict the exact priority of HANA in the future, but it is going to be reduced.

Do the Layoffs in HANA Point to Problems with Leonardo?

“Q: Another big topic we hear about in some parts of the market is around SAP Leonardo. As this is also part of your portfolio, what do you want people to know about SAP Leonardo? What do customers need to know?

A: Customers need to know that we have amazing engineers who are building more and more use cases with SAP Leonardo technologies embedded in our actual applications. This is what I was saying earlier about putting business value discussion before technology discussion. Look at companies like Pregis in the U.S., which is using SAP Leonardo Internet of Things (IoT) technology to monitor and analyze its machines. You even see SAP Leonardo Blockchain examples with Bumble Bee Foods tracing tuna from sea to the store shelves.

Machine learning use cases in our applications are expanding rapidly, and their impact can be seen in every industry. In fact, we have 100 unique machine learning-enabled scenarios, embedded in every SAP application, from SAP Fieldglass to SAP S/4HANA.

Another example of how customers benefit from intelligent technologies is BNP Paribas: The banking group was able to reduce customer on-boarding process for Hello bank!, its online bank, from 25 minutes to less than five minutes by using intelligent robotic process automation.

Maybe the one thing I wish we had done differently when we began promoting SAP Leonardo is to make the argument clearer to our customers that if you run SAP applications, you are going to benefit from SAP Leonardo innovation. This is a fundamental piece of our intelligent enterprise strategy and it’s only going to accelerate.”

Our Analysis

Mueller is really lying in this explanation. We covered in the article Our 2019 Observation: SAP Leonardo is Now Dead, that Leonardo will disappear as a product. SAP cannot have success with Leonardo because IoT is based upon open source components (which SAP is never successful with), and IoT is not inherently tied to the ERP system, which is how SAP sells all non-ERP applications into their account base. SAP can normally get a few companies to invest in something like Leonardo, but these are really just custom development projects. Information from those that have worked with Leonardo state that it is not a product. SAP will create a custom solution for you if you pay them. But it is not a packaged solution.

Machine learning is not expanding in SAP.

Mueller’s entire response is false. The reason the layoffs hit Leonardo is that Leonardo is not relevant for customers, they are not buying, and therefore Leonardo resources are not needed.

What is SAP’s Biggest Challenge?

Q: What is SAP’s biggest challenge and its biggest opportunity?

A: Our biggest challenge is to stay focused on our customers. It is so tempting in the technology industry to get carried away with buzzwords and “new breakthroughs.” The reality is that we are here to help companies extract value from technology, which is very different than simply celebrating every new idea. Customers expect us to be innovative, but also to protect them by making technology scalable in the global economy.

Our biggest opportunity is to connect enterprise technology to the individual, whether that’s the end consumer or the employee. This is the one boundary of enterprise technology that hasn’t been crossed. I am very confident we can do it and that we can improve people’s lives in the process. This is why you have only just begun to hear about the importance of experience data in addition to operational data.”

Our Analysis

SAP is all about buzzwords. Meuller used numerous buzzwords such as machine learning, IoT, blockchain, etc.. And these are buzzwords that have just about nothing to do with SAP’s business.

If you are using the term blockchain to fill the gaps in your life or to make yourself seem more interesting than you are. If so you need to talk to your doctor as to why you feel the need to use this term.

So it is odd to read a few paragraphs later about how it is tempting to get carried away with buzzwords. A major problem with Mueller’s predecessor, Bjorn Goerke.

The things Bjorn Goerke said did not come true and were often misleading. Who attended a session with Goerke and said “yes I am getting the real story here.” The misinformation in this interview with Ray Wang comes fast and hard. Entirely left out of this discussion is how SAP is marking up cloud services by between 3x and 10x. 

Virtually nothing that Bernd Leukert said would happen came true. SAP has a distinct shortage of people in top positions who will tell the truth. If all the top people are good for is repeating false information, it will be impossible for SAP to make the changes they need to in order to improve. 

Now both Leukert and Goerke are gone from SAP, however, Mueller does not seem like he will be saying anything that is true during his tenure. Then Mueller will be gone in a few years, replaced by another practicer of make-believe. These characters all say about the same things, so there might be an AI robot who is actually writing these comments, and Leukert and Goerke, et al are simply hired actors. At this point who can tell the difference.

The rest of Mueller’s quote does not give us anything to analyze because it is lacking in any content.

Conclusion

A number of SAP resources critiqued our analysis of SAP’s layoffs. A month ago we were told by many SAP resources not to comment on the layoffs. That it was “inappropriate.” However, Mueller now has commented on the layoffs, and it is doubtful any SAP resources will state that it was inappropriate for Mueller to comment. The concept here being that only SAP should be allowed to comment on their layoffs and that all of those that work in SAP or research SAP should look to one source for what the layoffs mean — which is SAP’s PR department. However, unlike any of the PR controlled explanation provided in this article from SAP our analysis actually made sense.

This explanation offered by Meuller makes no sense and is pure PR fiddle-faddle. But maybe this is what SAP resources want, a completely inert and false explanation that makes SAP look as good as possible. If so, this is the article to read if one wants to learn absolutely nothing about the real reasons for the layoffs.

However, if you work in SAP, listening to Mueller’s explanation is a bad thing, because it will prevent you from making adjustments. SAP is making these adjustments but does not want the outside world to be able to understand what they mean.

Financial Disclosure

Financial Bias Disclosure

This article and no other article on the Brightwork website is paid for by a software vendor, including Oracle and SAP. Brightwork does offer competitive intelligence work to vendors as part of its business, but no published research or articles are written with any financial consideration. As part of Brightwork’s commitment to publishing independent, unbiased research, the company’s business model is driven by consulting services; no paid media placements are accepted.

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References

Five Questions with SAP CTO Juergen Mueller

Similarities Between Thomas Edison, Elizabeth Holmes and Hasso Plattner

Executive Summary

  • After analyzing SAP more than any other research entity, we have come to some important conclusions regarding Hasso Plattner that are not generally known.

Introduction

Companies tend to centralize their coverage around a person who is put forward by the company without checking if the person put forward is actually the individual who is the primary innovator. In this article, we will draw parallels between Thomas Edison, Elizabeth Holmes and Hasso Plattner.

Thomas Edison

Thomas Edison is often considered one of the most prolific inventors in the world, but this conclusion can only be come to if one does not research Thomas Edison’s background. Thomas Edison took credit for making improvements in a light bulb, but this was due to a US patent of British inventory Joseph Swann. Thomas Edison ran a lab where he as a normal course of behaviour exploited other inventors that were drawn to his Menlo Park, NJ facility due to Edison’s frequent and high profile coverage in the press at the time. Just the number of patents that Edison accumulated, which was 1093, should raise suspicions as to whether these patents were Edison’s from those that he employed.

Thomas Edison was a minor technological talent, but a major marketing talent. And he determined what image the public was looking for, and created it.

“The people wanted a man of singular genius and competence; a man whose ideas and will shaped the world around him; a face that they could put on progress and American technological dominance. And Edison obliged. He made himself into this admirable, heroic figure, at least in appearance, and the people ate it up.” – QualityLogoProducts

It was Thomas Edison’s savvy control over media that caused so many budding scientists to reach out to Thomas Edison and allowed him to steal the inventions of so many people. Thomas Edison has all of these people working in his lab (even Henry Ford worked for Edison) but when it came to taking credit it was all Thomas Edison, only Thomas Edison was quoted, only Thomas Edison’s name appeared on patents. This was fake. Thomas Edison was not without his talents. For example, he was a fantastic “packager” of innovation, but he was not himself an innovator. Rather this was a role that he played for the media.

Although it is important to point out that taking IP from others, and even the credit is the basic model of companies that deal in IP under the work for hire contracts. This along with exaggerating the IP that one creates is a common feature of private companies. What is curious is that it is allowed for not only for the company to claim the IP, but also for them to claim the credit.

Thomas Edison was presented as the actual person doing the work of invention. This was a media construction. Edison was a promoter posing as an inventor. This might have been the first time he held that lightbulb outside of a photo opportunity that week. Edison had a large pool of low paid employees who were doing the actual work. Let us see Telsa’s view of Edison’s scientific mind. 

““His [Thomas Edison] method was inefficient in the extreme, for an immense ground had to be covered to get anything at all unless blind chance intervened and, at first, I was almost a sorry witness of his doings, knowing that just a little theory and calculation would have saved him 90 per cent of the labor. But he had a veritable contempt for book learning and mathematical knowledge, trusting himself entirely to his inventor’s instinct and practical American sense. In view of this, the truly prodigious amount of his actual accomplishments is little short of a miracle.

“Edison was by far the most successful and, probably, the last exponent of the purely empirical method of investigation. Everything he achieved was the result of persistent trials and experiments often performed at random but always attesting extraordinary vigor and resource. Starting from a few known elements, he would make their combinations and permutations, tabulate them and run through the whole list, completing test after test with incredible rapidity until he obtained a clue. His mind was dominated by one idea, to leave no stone unturned, to exhaust every possibility.” ” ― Nikola Tesla

It should be noted that very few inventors would have had the funding and workforce to test so many permutations. Edison’s lab did have a value, which was to refine the inventions of others. This is the general problem with innovation, those with the financial backing are able to take advantage of those that lack those resources.

In the present day, intellectual property attorneys, the cost of litigation, and the need that individuals have for employment all combine to constantly move inventions and innovations from the actual creators to those with more financial resources. History shows that those with more wealth have a strong proclivity to steal intellectual property from those with less wealth. Any person who is reading this and who creates innovations should expect that someone with more resources will attempt to steal their intellectual property from them. The better the intellectual property the stronger the likelihood that this will occur. We have met a number of people in our professional experience who generally believe that IP should be stolen from their inventors by any means necessary.

Let us move to our second example.

Elizabeth Holmes of Theranos

Elizabeth Holmes named her blood testing device Edison, which was, of course, a nod to Thomas Edison. She also was a big fan of Steve Jobs, another promoter who was more known for his marketing and image making savvy than his technology knowledge. For Elizabeth Holmes skill set, Holmes picked her inspirational icons well.

Elizabeth Holmes is now known as a fraud, but for over 10 years, Elizabeth Holmes raised $900 million through essentially the strength of her vision, her personality, her connections and her story.

How to Make Zero Progress After 13 Years and $900 Million: Start With Not Knowing Anything

Theranos is an interesting case study in that the company made zero progress towards anything because the original design objectives did not make any sense. This is because Elizabeth had only completed a few college courses in biology before starting Theranos, she did not know enough to know what she did not know.

There are specific reasons why the current blood analysis system is set up as it is, with blood drawn from the vein rather than from a fingerprick. If Elizabeth had studied the topic before starting her company, she would have figured out the reasons.

The entire story around Theranos was fake. Elizabeth Holmes did not have any knowledge to accomplish what she intended she said she would accomplish, and once she began running the company, she did no technical work on Edison but simply hired people with technical training to accomplish what was an impossible goal. However, if her employees had somehow succeeded in doing 100% of the work to get Edison to work, there is little doubt that Holmes would have taken full credit for the accomplishment and media outlets would have supported her in her claim. 

It is easy to be optimistic when you don’t know the subject matter. 

Elizabeth Holmes placed her name on a patent in 2003 that it is now widely thought should never have been granted. As is pointed out by the Above the Law.

‘“Holmes’s 2003 application was not a ‘real’ invention in any meaningful sense . . . Indeed, it’s fair to say that Holmes’s first patent application was little more than aspirational science fiction written by an eager undergraduate.” Nazer goes on to note that the patent examiner for one of Holmes’s patents (U.S. Patent No. 7,291,497) did review it closely (for technical issues), but “[w]hat the examiner did not do . . . was ask whether Holmes’s ‘invention’ actually worked.”  Holmes was granted a patent for an idea, but not one that could actually be practiced.” Unfortunately, the patent examination system in the United States is overburdened and under-resourced. As I noted previously, “USPTO today is overwhelmed with patent applications and, as a result, patent examiners do not have adequate time or resources to thoroughly examine the applications. The agency receives more than 600,000 patent applications per year and patent holders are constantly pressuring for quicker deliberation in approving their applications . . . Because of the high volume of applications an examiner must process . . . it has been estimated that 70 percent of examiners have less time than necessary to thoroughly complete an examination.” Not only do patent examiners have inadequate time to determine whether prior art exists (remember: patents must reach a “novelty” threshold), but they certainly aren’t equipped to determine whether the invention actually works (meeting a “utility” requirement that the invention is useful and an “enablement” requirement that would allow a person of ordinary skill in the art to be able to build and use the invention; this is part of the patent bargain that grants a limited-time monopoly, but ultimately serves the public good).”

And this following quotation from Ars Technica is truly jaw-dropping.

“The USPTO generally does a terrible job of ensuring that applications meet the utility and enablement standards. In practice, unless an application claims an obviously impossible device (like a perpetual motion machine), the examiner will not question whether it works. To some extent, this is understandable. Examiners only have a few hours to review each application, and they can hardly be expected to run complex experiments to check the applicants’ claims. But this practice can lead to serious errors.

Yet more than a decade after Holmes’ first patent application, Theranos had still not managed to build a reliable blood-testing device. By then the USPTO had granted it hundreds of patents. Holmes had been constructing a fantasy world from the minute she started writing her first application, and the agency was perfectly happy to play along.”

How the US’s Broken Patent System (in part) Allowed Elizabeth Holmes to Start Theranos

That patent was used to trick investors, along with Elizabeth Holmes other skills in persuasion, to investing in Theranos. The assumption was that a patent from the US patent office has been investigated. But as explained this is was a faulty assumption. And Theranos an example of many people who did not do sufficient research before they invested, or repeated what Elizabeth Holmes said to them. Theranos received investments from a wide array of powerful individuals ranging from Rupert Murdock to Larry Ellison.

There are several commonalities that we can see between Thomas Edison and Elizabeth Holmes.

  1. Exaggerating their role in the technical work of invention.
  2. A corresponding high degree of reliance upon uncredited workers who do the actual work.
  3. A strong ability to obtain media coverage.

In terms of the environment, there is another clear parallel which applies to both Thomas Edison and Elizabeth Holmes even though they were separated by roughly 130 years and even though the media systems in the late 1800s, an environment dominated by print media and with no television or Internet, was quite different from the media environment of the 2010s.

  1. Media entities looking for a story which oversimplifies the innovation process and centralizes it to a single person. It should be noted that both Thomas Edison and Elizabeth Holmes were able to pull this off without any education in their fields (although Elizabeth Holmes had the prestige of having dropped out of Stanford).
  2. Media entities that do an insufficient amount of fact-checking.
  3. Media entities which quickly referred to other media entities, assuming that they had performed the background research and therefore they did not have to.

The separation of these two individuals by such a long period of time indicates to us that this is a constant feature of our media system.

And now we turn to Hasso Plattner.

Hasso Plattner

We have spent hundreds of hours analyzing the writing of Hasso Plattner, his books, comments on blogs, his SAPPHIRE videos and so on. And from this analysis, we have found some interesting parallels to Thomas Edison and Elizabeth Holmes.

Through our analysis of various SAP topics, we have repeatedly run into inaccurate features around Hasso Plattner. It is impossible to separate Hasso Plattner from SAP. SAP put significant resources into promotion Hasso Plattner. SAP created a false backstory around HANA as we covered in the article Did Hasso Plattner and His PhD Students Invent HANA? SAP would have to have known that this story was made up. Hasso Plattner is repeatedly introduced as a “Dr Hasso Plattner” even though SAP certainly knows that Hasso Plattner only has honorary doctorates as we covered in Does SAP’s Hasso Plattner Have a PhD?

Hasso has used his phoney professorship at an institute called the Hasso Plattner Institute he started on the campus of the University of Potsdam in Germany to claim that he is “unbiased” in his claims around HANA, as can be seen from the following quotation.

“please stick to the facts and be willing to accept new insights.

i wrote this this blog as a professor of computer science at the university of potsdam and as an adviser in the sap hana project. i am not an employee of sap any more.

any comments are welcome. -hasso plattner”

  • Hasso wrote this comment and apparently claimed that he no longer has any connection to or any of his wealth tied up in SAP. Hasso is now completely independent of SAP, and the HPI is not heavily invested in the HANA storyline?
  • Secondly, how is Hasso Plattner a professor of computer science anywhere? Hasso has no undergraduate or graduate degree in computer science.

Hasso and HANA

HANA clearly demonstrated Hasso Plattner’s lack of technical expertise. Hasso’s books such as “The In Memory Revolution.”

Hasso made enormous errors when “designing HANA.” 

  • HANA was originally designed to have no row oriented tables, and then in SPS08, suddenly what SAP said were not needed (row oriented tables) were added to HANA as we covered in the article How Accurate Was John Appleby on HANA SPS08?
  • Hasso for some reason thought databases could be made zero latency.
  • Hasso thought that all data could or should be loaded into memory, even though only a small fraction of data within a database is normally processed at any one time. Hasso missed the fact that loading such large amounts of data into memory, lead the processor to spike and become overcapacity as we covered in the article How HANA Takes 30 to 40 Times the Memory of Other Databases.

The list of design errors made by Hasso on HANA are their own article, but as with Elizabeth Holmes, Hasso never put the work into sufficiently study databases to understand what was possible. Like Elizabeth Holmes, he was a promoter, who was pretending to be an inventor.

Hasso and ERP

Hasso Plattner and SAP have expanded into many software categories since the late 1990s, but SAP has not been effective in developing applications in any of them. SAP’s most popular internally developed application outside of their flagship ERP system is BW or the business warehouse. However, it is one of our lowest rated applications as we covered in the article Could SAP DP or BW Survive as Independent Products from SAP?

The common idea is that SAP may have very poor products outside of their ERP system, but their ERP system is very “solid.” However, there is a problem with this storyline as well. When we reviewed the academic literature on the ROI of ERP systems we found that for decades academic studies have not been able to find any ROI on ERP systems. We cover this topic in detail in the book The Real Story Book on ERP. And SAP has the most expensive ERP implementations in the industry. For details, see our article How to Understand The High TCO and Low ROI of ERP. Because of this high average cost of SAP ERP implementations, this means that in the vast majority of cases SAP customers lost money from their SAP ERP implementations. The information regarding the lack of ROI from ERP systems is publicly available, yet there has been no financial incentive to inform buyers of this reality, because the industry, which is made up of vendors, consulting firms, IT analysts and media entities are financially incentivized to continue to push ERP systems.

But the situation is actually worse than this.

The reason is that by implementing SAP ERP systems, SAP customers often ended up purchasing other systems that connected to the ERP system that was always a step down from the ERP system. And the ROI from those connected systems (BW, APO, MDM, PLM, etc..) were significantly negative. This would have to mean that every customer that purchased SAP was actually worse off than if they had never purchased anything from SAP.

Conclusion

Like Thomas Edison and Elizabeth Holmes, Hasso Plattner is not an innovator, he is a promoter who has been positioned by SAP as a person of substance when he isn’t. SAP has done this because it fits within the media’s interest in finding “one person” who they can say is the brains behind a company.

Hasso Plattner greatly reduced his credibility with us the more we analyzed his writing over the years. Hasso not only can’t write, but he is also incapable of writing in a structured manner. He is also quite mentally lazy and does not research the items he speaks about before he speaks or writes.

All of this means that Hasso Plattner has been visiting companies and has made impressions on people based upon his fame and people have been looking for answers from a person who does not have any. He is not what SAP says he is, what the media says he is, or what SAP resources or what executives think he is. What Hasso Plattner is, is a highly effective promoter. But his ability to effectively promote is based upon a false background as to his technical knowledge.

Financial Disclosure

Financial Bias Disclosure

This article and no other article on the Brightwork website is paid for by a software vendor, including Oracle and SAP. Brightwork does offer competitive intelligence work to vendors as part of its business, but no published research or articles are written with any financial consideration. As part of Brightwork’s commitment to publishing independent, unbiased research, the company’s business model is driven by consulting services; no paid media placements are accepted.

SAP Contact Form

  • Questions About This Area?

    The software space is controlled by vendors, consulting firms and IT analysts who often provide self-serving and incorrect advice at the top rates.

    • We have a better track record of being correct than any of the well-known brands.
    • If this type of accuracy interests you, tell us your question below.

References

http://theconversation.com/thomas-edison-visionary-genius-or-fraud-99229

https://arstechnica.com/tech-policy/2019/03/theranos-how-a-broken-patent-system-sustained-its-decade-long-deception/

https://www.ranker.com/list/things-edison-claimed-to-have-invented/melissa-sartore

Elizabeth Holmes And The Great Patent Scam

https://medium.com/@asandalis/law-7-get-others-to-do-the-work-for-you-but-always-take-the-credit-e58829dd670d

How the patent office’s lax standards gave Elizabeth Holmes the BS patents she needed to defraud investors and patients

https://www.quora.com/I-hear-many-people-claim-Thomas-Edison-was-a-fraud-and-cheat-Is-that-true

Pathologist Raises Questions about Theranos’ Business Model

Unconventional Tactics: What Thomas Edison Can Teach Us About Self-Promotion

https://en.wikipedia.org/wiki/List_of_Edison_patents

Should Brightwork Research & Analysis Sell Out to SAP?

Executive Summary

  • It has been proposed that SAP should not be critiqued and that all information about SAP should come from SAP funded sources.
  • We ask the question if readers prefer that we sell out to SAP.

Introduction

Our last article on HANA titled SAP’s Layoffs and a Brightwork Warning on HANA created quite a tizzy in the SAP community. With many SAP resources preferring if it has not been written. In this article, we discuss some of the input we received and then open the question of selling out to SAP to a poll that readers can voice their views.

The Consulting, IT Media and Analyst Landscape

In terms of providers of information on SAP, nearly all entities that provide information on SAP receive financial benefits from SAP. In the consulting sphere, this is well known and controls the information or “advice” offered to customers. In the IT media space, through advertisement and paid placement controls the vast majority of entities as we covered in How to Best Understand Control of the SAP on IT Media.

In the IT analyst space, both Gartner and Forrester and directly paid by SAP, and most of the other analysts are also paid by SAP and others both paid and offered up lucrative advisement contracts to the immense SAP customer base. This has produced typically forecastable compliant content. It is perhaps the primary reason SAP is able to distribute so much false information about their products to the market.

The best way to make money in the SAP market is to align with SAP and to deceive your readers or customers.

The Problem with Brightwork Research & Analysis

Our primary problem is that we don’t take income from vendors including SAP, and the second problem is we know SAP quite well, having worked in SAP for decades and producing the most research on SAP. A final problem is that follow a research approach that means we have to follow the evidence down to its conclusion, without worrying about who we contradict or whose feelings might be hurt. This puts us at odds with nearly all of the information providers in the space. And it is why we are not on the approved SAP list of analyst firms that IT media can contact as we covered in How to Become an Approved Analyst for SAP?

Becoming a passive repeater is profitable. Its how most of the information providing entites in SAP make their money. 

Becoming SAP’s Passive Repeater

The best way for Brightwork Research & Analysis to make money is to solicit SAP for funding and become a repeater for their marketing department. This would not only bring in money (we think, we have not reached out to SAP to see what we could get from them, but we do know they pay other information providers in the space), but it would also reduce our work effort. As can be seen from other analysts and media entities that are also paid by SAP, as well as reviewing the SAP consulting company websites it means being able to drop almost all thought altogether. All we need to do is republish SAP’s material on our site — so SAP provides the content!

We covered the topic of how little work ASUG seems to do in writing articles about SAP in the article How ASUG Lost its Way and Sold Out to SAP.

The trick is like ASUG and Forrester and Gartner will be to pretend that the funding by SAP has nothing to do with our SAP marketing-driven content. We can even set up a fake ombudsman as has Gartner as we covered in What is the Difference Between the Gartner Ombudsman and Disclosure.

The benefits should be obvious to anyone.

100% Control Over Information Provided Entities

The message we are getting from many sources that are financially connected to SAP is that there should not be any providers of information on SAP unless that source is financially connected to SAP. And this is also the best way to monetize the research effort that goes into our content (in addition to reducing the research effort considerably.)

Your Chance to Tell Us Your View

So this is where we need the advice of readers as to what to do. Please fill out the poll which can let us know what you think we should do!

Financial Disclosure

Financial Bias Disclosure

This article and no other article on the Brightwork website is paid for by a software vendor, including Oracle and SAP. Brightwork does offer competitive intelligence work to vendors as part of its business, but no published research or articles are written with any financial consideration. As part of Brightwork’s commitment to publishing independent, unbiased research, the company’s business model is driven by consulting services; no paid media placements are accepted.

SAP Contact Form

  • Questions About This Area?

    The software space is controlled by vendors, consulting firms and IT analysts who often provide self-serving and incorrect advice at the top rates.

    • We have a better track record of being correct than any of the well-known brands.
    • If this type of accuracy interests you, tell us your question below.

Its Official, If You Work for SAP Its Ok to Lie About Having a PhD

Executive Summary

  • Hasso Plattner has been lying about his Ph.D. for decades.
  • However, according to one SAP resource, lying about one’s Ph.D. is not a bad thing.

Introduction

In our article, Does Hasso Plattner Have a PhD?, we outlined the fact that Hasso’s PhDs are honorary, but are presented as real.

Curiously, we received pushback on this from an SAP consultant.

“You really must have run out of real arguments against SAP in what feels what a personal vendetta? It’s quite simple: If you earn a Doctorate (incl h.c.) from an accredited university, then, in Germany, you can chose to add it to your ID/passport. Many people do and use it as if part of the name -some say not to do so would be uncourteous to the organisation you received an hc from. It is as outdated as are the Sirs in Britain or the bowing angle corresponding to social hierarchy in Japan and if you ask me, whether it adds value: certainly not. There are much higher achievements than Dr. hc or PhD that don’t get the same attention. But it is legal, not fishy at all and in line with normal custom. But really, it’s all a non-issue: someone uses an old fashioned pre-fix to his name. He never claimed to be something he isn’t. If some people thought he has a real PhD, they didn’t buy his software for this reason and he was long past the point, where his academic achievement mattered for career progression. So, what’s the fuzz? On his hon Professorship: he was a visiting professor at my Uni – we learned more from him than from any of the ivory tower products with PhD. Nothing fake about this – he really did it.” – Sven Ringling

Ding Ding Ding!

Sven Ringling gets our Golden Pinocchio Award.

Conclusion

What Sven leaves out of the analysis is why Hasso did it. If it made no difference, why did Hasso present a fictitious Ph.D. as real? No one would do that as honorary doctorates aren’t relevant. He did it for one reason, to borrow from the authority of academia. 

Financial Disclosure

Financial Bias Disclosure

This article and no other article on the Brightwork website is paid for by a software vendor, including Oracle and SAP. Brightwork does offer competitive intelligence work to vendors as part of its business, but no published research or articles are written with any financial consideration. As part of Brightwork’s commitment to publishing independent, unbiased research, the company’s business model is driven by consulting services; no paid media placements are accepted.

SAP Contact Form

  • Questions About This Area?

    The software space is controlled by vendors, consulting firms and IT analysts who often provide self-serving and incorrect advice at the top rates.

    • We have a better track record of being correct than any of the well-known brands.
    • If this type of accuracy interests you, tell us your question below.

How Useful is SAP API Management?

Executive Summary

  • SAP API Management is resold Apigee and is promoted to improve integration.
  • How valid are SAP’s claims around SAP API Management?

Introduction

SAP offers the following video on the SAP API Management product. We have placed our observations about the video below the video.

SAP API Management as Part of SAP Cloud?

We have already written about how SAP Cloud is primarily a mechanism for upcharging other cloud providers in the article How to Understand SAP’s Upcharge as a Service. So right off the bat, an item that is part of SAP Cloud is a problematic item to use. Secondly, beyond the very poor financial terms of SAP Cloud, SAP Cloud is a highly inefficient PaaS to use. Therefore the connection between SAP API Management and SAP Cloud is a bit of a deal breaker for us.

Sharing Mobile Data, IoT and Production Data with SAP API Management?

SAP really only has control over one of these three areas. They have nearly no IoT business, they are a nonentity in mobile. Therefore this proposed ability to share SAP data among these three areas is not persuasive. The whole “sharing real-time data” statement is very much not educational. Any interface can be scheduled to run in batch or in real time.

Real Time Analytics?

Analytics can be run real time, which is called a refresh….but what does this have to do with SAP API Management?

Manage Your Entire Ecosystem of Customers and Suppliers?

SAP has the most difficult to integrate products in enterprise software. As for collaboration, SAP’s SNC product is no longer functional. Ariba is in decline and has never extended much beyond indirect procurement. In fact, placing one’s data into SAP is one of the best ways to reduce one’s interaction with outside entities. Therefore will all of these areas be magically improved by using an API management tool like Apigee, or SAP API Management? This seems like quite a stretch.

SAP and Microservices with SAP API Management

This quote is from the Apigee website.

“Many existing and legacy services are not built for modern scale. Consequently, enterprises are adapting legacy services for modern use by breaking up monolithic applications into microservices. In most cases, however, there are already many applications taking advantage of services from the monoliths. The transition to microservices must be done in a way that makes it seamless—invisible to those other applications and developers using the monolith services.

Design and build APIs that developers love. Easily create API proxies and visually configure or code API policies as steps in the API flow. Customize API behavior using JavaScript, Python, or Node.js. Transform from or to any protocol including SOAP, REST, XML binary, and custom protocols.”

There are several problems with this quote. Let us list them.

  1. Companies are breaking monolithic applications into microservice….but not SAP customers. SAP is firmly a series of monolithic applications, and there is no movement afoot to break them into microservices. What SAP is doing is co-opting the terms around microservices without actually becoming microservice in their design. This is the same issue with using the term containers with SAP. It is not a thing that is presently done with SAP. Secondly, SAP projects have all manner of higher priority items they need to invest in, such as evaluating code prior to S/4HANA implementations. It is unlikely that microservices area true emphasis area for SAP or their customers.
  2. SAP does not use Python or Node.js. They have documentation around SOAP, REST and XML but they are not a “thing” on SAP projects. SAP uses a language called ABAP that has nothing to do with anything mentioned in this quote, along with some Java. And ABAP is distinctly not appropriate for and web development.
  3. SAP is about creating interfaces with ABAP, sometimes to IDOCS which are hierarchical files that require extensive transformation. SAP has not changed its integration much since the 1990s in a way that has meant much for projects (new products have been introduced, but none of them have been competitive with custom integration using programming rather than interfaces, which is a topic we covered in the article How Non Programming Integration Hurts SAP Projects.

Conclusion

We did not evaluate Apigee for this analysis. Apigee may be a great product. However, it does not fit with how SAP operates and its technology foundations. The fact that SAP is reselling Apigee (and combining it with SAP Cloud) really only means that SAP is offering customers the opportunity to be upcharged for a product it has nothing to do with. It never makes sense to purchase a product through SAP, because SAP will exaggerate the price and also the claims made by the actual software vendor.

By connecting Apigee/SAP API Management to the SAP Cloud, they drastically reduced the value of Apigee. Not only will SAP demand an upcharge for Apigee, but they will upcharge customers on any usage of APIs that are developed by Apigee as they will consume cloud services.

The fundamental problem is that SAP does not work anything like the environment that Apigee was designed for. Apigee is designed to manage services run from cloud service providers like AWS and GCP using modern development approaches under the construct of openness.

This is the exact opposite of how SAP environments work.

Now, we should mention that we/Brightwork is very much a supporter of the model proposed by Apigee. And we wrote two books about how to bring cloud services to SAP and Oracle environments and address the topics of microservices and containers and new development approaches taking place in the cloud in great detail. So we have no disagreement with the model presented by Apigee. However, this cannot be effectively performed within SAP’s construct. SAP had a comparative advantage in ERP systems, and it is attempting to use the account control built up from its ERP heritage to extend and insert itself into the cloud. Customers should be careful not to let SAP do this because so far, SAP has added nothing to the cloud except cloud confusion. The leaders in the cloud are far away from SAP in technology and approach. In fact, SAP should be considered an anti-cloud company. And the more customers allow SAP to insert themselves into their cloud, the more the cloud will turn into a negative ROI item that is entirely controlled by SAP.

And all of this is why we are predicting so much cloud expenditure will be wasted through SAP customers taking advice from SAP and their consulting partners on the topic of the cloud.

  • SAP is a non-starter as a cloud provider or cloud thinker. Most of what SAP states about the cloud is not correct or helpful.
  • Customers that want to use Apigee or a similar tool along with innovative cloud service providers for new development should absolutely do this and then connect this SAP independent development back to SAP. However, they should not touch SAP API Management with a ten-foot pole.

Financial Disclosure

Financial Bias Disclosure

This article and no other article on the Brightwork website is paid for by a software vendor, including Oracle and SAP. Brightwork does offer competitive intelligence work to vendors as part of its business, but no published research or articles are written with any financial consideration. As part of Brightwork’s commitment to publishing independent, unbiased research, the company’s business model is driven by consulting services; no paid media placements are accepted.

SAP Contact Form

  • Questions About This Area?

    The software space is controlled by vendors, consulting firms and IT analysts who often provide self-serving and incorrect advice at the top rates.

    • We have a better track record of being correct than any of the well-known brands.
    • If this type of accuracy interests you, tell us your question below.

References

https://apigee.com/api-management/#/products

AWS and Google Cloud Book

How to Leverage AWS and Google Cloud for SAP and Oracle Environments

Interested in how to use AWS and Google Cloud for on-premises environments, and why this is one of the primary ways to obtain more value from SAP and Oracle? See the link for an explanation of the book. This is a book that provides an overview that no one interested in the cloud for SAP and Oracle should go without reading.

Does Hiring Large SAP Consulting as Work as Political Insurance?

Executive Summary

  • A primary reason for hiring the major SAP consulting firms is for political insurance.
  • This means that if the project does poorly, that the decision makers can say they went with a major brand.

Introduction

Large SAP consulting companies have a long history of ripping off their clients. However, they continue to be used. Why? Well, one hypothesis is that the large consulting companies provide political cover for decision makers. Even though Deloitte or Accenture or WiPro or Cognizant or another SAP consulting firm constantly take advantage of their clients, they are at the very least “major brands.” Looked at this way, they can be seen as political insurance.

Paying to Get Robbed?

I recall a project where IBM was not getting what it wanted and they declared

“We cannot guarantee the success of the project if XYZ happens.”

I remember thinking, how does IBM guarantee the success of anything? You pay IBM and they support a project. There is no guarantee.

The risk is with the client. All that IBM does is bill the customer, there is no “guarantee” provided by any consulting firm.

How SAP Consulting Firms Increase Project Risk

These firms greatly increase the risk of failure of projects. Here is why:

  • The Consistently Poor Quality of Product Information Emanating from SAP Consulting Firms: The information they provide is of such self-serving and inaccurate quality. If you cannot find out what is true from the SI, then you are destined to implement incorrectly.
  • The Inability to Contradict SAP: The SAP consulting firms compete with each other to gain the approval of SAP. They will agree with SAP on anything they say, creating a fake impression of an independent third party.
  • Intense Hierarchy: No one but the top people on a project have any ability to determine what information will be released to a customer. All of the technical resources are entirely subordinate to the senior members, who are in turn subordinate to the most senior members within the consulting firms where policy is made.

Therefore the waste is worse than just their billing rate, they push companies to implement the worst systems (the most immature, worst fit for the requirements — the ones that the consulting firm specializes in billing for) and often in the worst way for their clients.

It is similar to paying robbers to come into your house to rob you. Typically you can just get robbed for free.

Given Their Track Record, Why Do the Major SAP Consulting Firms Continue to Sell Work?

As observed by Ahmed Azmi.

“Customers really don’t have better options unless they’re willing and capable of doing the work themselves. Many don’t have that ability in house. It’s much easier to outsource everything to an SI and take what they can get. If the system under-delivers, they must downplay the problems because they are part of the project. Customers really don’t have better options unless they’re willing and capable of doing the work themselves. Many don’t have that ability in house. It’s much easier to outsource everything to an SI and take what they can get. If the system under-delivers, they must downplay the problems because they are part of the project.”

Where Does Competition Occur in SAP Consulting?

The description laid out in the previous comment essentially proposes the SAP consulting firms as being selected primarily for appearances (insurance, lack of personal responsibility in selecting a “brand” etc..).

This means that the various consulting firms “compete” but only within the context of agreeing with whatever SAP says. Therefore customers can choose from what amounts to the same rigged advice from any of the companies.

  • The consulting firms do not complete on which can implement in fact, because the implementation history of each is unknown.
  • SAP recommends companies that follow SAP’s directives, always placing client interests at the bottom of the trough.

Those that do what SAP says, get more business. In this sense the more you lie for SAP, the more business you get. In fact, in our research into the media output of SAP consulting firms, we find almost no variance between the information published by any of them. This would not be such a terrible thing, but the issue is that so much of the published information is false. That means that a wide variety of consulting entities are publishing the same false information……because it comes centrally from SAP.

Therefore, the competition is greatly based upon who can lie better for SAP.

Conclusion

The competition between the SAP consulting firms is within a very narrow context, and mostly not what is good for customers. If one chooses Deloitte or Accenture there is little practical difference in the quality of information that the customer will receive.

The political insurance that decision makers obtain from selecting one of the major SAP consulting firms comes at an enormous cost, and not only greatly increases the costs of implementation, but also increases the risk of failure. Therefore, while perhaps functional for the decision maker, it is dysfunctional for the companies that end up paying the consulting bill.

Financial Disclosure

Financial Bias Disclosure

This article and no other article on the Brightwork website is paid for by a software vendor, including Oracle and SAP. Brightwork does offer competitive intelligence work to vendors as part of its business, but no published research or articles are written with any financial consideration. As part of Brightwork’s commitment to publishing independent, unbiased research, the company’s business model is driven by consulting services; no paid media placements are accepted.

SAP Contact Form

  • Questions About This Area?

    The software space is controlled by vendors, consulting firms and IT analysts who often provide self-serving and incorrect advice at the top rates.

    • We have a better track record of being correct than any of the well-known brands.
    • If this type of accuracy interests you, tell us your question below.

References

Enterprise Software Risk Book

Software RiskRethinking Enterprise Software Risk: Controlling the Main Risk Factors on IT Projects

Rethinking Enterprise Software Risk: Controlling the Main Risk Factors on IT Projects

Better Managing Software Risk

The software implementation is risky business and success is not a certainty. But you can reduce risk with the strategies in this book. Undertaking software selection and implementation without approximating the project’s risk is a poor way to make decisions about either projects or software. But that’s the way many companies do business, even though 50 percent of IT implementations are deemed failures.

Finding What Works and What Doesn’t

In this book, you will review the strategies commonly used by most companies for mitigating software project risk–and learn why these plans don’t work–and then acquire practical and realistic strategies that will help you to maximize success on your software implementation.

Chapters

Chapter 1: Introduction
Chapter 2: Enterprise Software Risk Management
Chapter 3: The Basics of Enterprise Software Risk Management
Chapter 4: Understanding the Enterprise Software Market
Chapter 5: Software Sell-ability versus Implementability
Chapter 6: Selecting the Right IT Consultant
Chapter 7: How to Use the Reports of Analysts Like Gartner
Chapter 8: How to Interpret Vendor-Provided Information to Reduce Project Risk
Chapter 9: Evaluating Implementation Preparedness
Chapter 10: Using TCO for Decision Making
Chapter 11: The Software Decisions’ Risk Component Model

How to Understand SAP’s Strange Predictive Analytics for ML

Executive Summary

  • SAP states that they have advanced predictive analytics for machine learning.
  • In this article, we review the predictive analytics that SAP offers.

Introduction

SAP offers the following predictive analytics for machine learning.

Anomaly Detection with Principal Component Analysis

Here is the example SAP provides.

“A railway operator uses sensors in locomotives. Four motors each have four temperature sensors. If the motors are working correctly, all 16 sensors send data about a synchronous increase or decrease of temperature. PCA notes when this behavior changes. You would use this algorithm to monitor this behavior and to detect if sensors send temperature data that differ from other sensors, which might indicate that a motor is damaged and needs to be maintained.”

We are trying to think under what circumstances this ML algorithm would make sense to use.

Distance-Based Failure Analysis Using Earth Mover’s Distance

“An airplane contains electric devices that have batteries inside. These electric devices are equipped with at least two sensors that send data. Sensor A sends data about measurements of electric current, sensor B sends data about voltage measurements. An electric device could also have a sensor C that sends data about temperature measurements. The data sent by the three sensors not only depends on the electric device itself, but also on other factors that affect the electric device and its batteries. These factors could be the weather conditions at heights of several kilometers, how often the device is used in the cockpit, under which conditions the pilot uses the device, and so on. It is therefore normal that data sent from the three sensors might vary around a certain mean score. The data from each sensor can be visualized in a one-dimensional histogram. For multidimensional visualizations, scatterplots are used. This visualization is like a fingerprint of each battery in the airplane. To compare the sensor data of different batteries without looking at and comparing each visualization, a distance measure for probability distributions is needed. One of these measures is the Wasserstein metric, or EMD. It can be used to measure deviation from a known good reference fingerprint of a battery, or to measure differences between several batteries of the same type, for example.”

Same thing applies for this algorithm.

Remaining Useful Life Prediction Using Weibull

“The Weibull algorithm can be used to calculate the expected remaining useful life (RUL) of an asset, and to calculate the probability of failure of an asset.”
This would be used to determine the failure rate of say a service part.

Anomaly Detection Using Multivariate Autoregression

“An example might be the changes in the outflow temperature of a system, which after a while is also reflected in the inflow temperature of a downstream system. MAR can handle different kinds of sensor values, and autonomously ranks their influence on each other. The algorithm can therefore handle noisy or random signals.”

This is another strange choice for a machine learning algorithm.

Strange ML Algorithms

SAP’s choice of ML algorithms is quite strange. Common ML algorithms include the following:

  1. Support Vector Machines
  2. Learning Vector Quantization
  3. Naive Bayes
  4. Classification and Regression Trees
  5. Linear Discriminant Analysis
  6. Logistic Regression
  7. Linear Regression

Interestingly we can’t see the ML algorithms that were selected by SAP being used.

ASUG on SAP Predictive Analytics

“So how does one actually buy Predictive Analysis? There are, it turns out, several different methods, and I’ll do my best to make it clear:

1. It’s bundled into SAP Lumira, within the Lumira code base, Gadalla says. But there’s a catch: You have to buy a key code to “light it up,” he says.

2. But if you buy Predictive Analysis, you get Lumira for free. (Got it?)

3. Predictive Analysis is embedded within about 20 different HANA apps (such as CRM, SCM, Partner Relationship Management and Liquidity Forecaster).

4. Predictive Analysis is also bundled with a HANA box, “where I’m using HANA as a server, where I’m doing my analysis,” Gadalla says.

Current pricing on SAP Predictive Analysis is $20,000 per seat with a minimum purchase of 5 seats, according to Gadalla.

No discussion of a new SAP product would be complete without that requisite HANA mention, of course. Gadalla reports that HANA went head to head with top competitors in doing clustering analysis, and he claims that competitors’ wares took 40 hours to do the job whereas HANA took just 2 minutes. “It was the same exact equation and same exact data,” he says.””

First, all of the algorithms used by SAP are in the public domain. SAP had nothing to do with creating them. So why are customers being changed to use them? Secondly, the HANA database will do nearly nothing to help anyone run predictive analytics faster. We run predictive analytics ML on a laptop using MySQL and it normally takes less than 20 minutes for them to run, a time we can switch to another task. And the time in running ML is in analyzing the output not in running the algorithm.

Conclusion

SAP is lying to customers with respect to its ML.

  1. The ML algorithms selected by SAP don’t make much sense for what customers would normally use them for. The use case examples show how odd it would be to use them. Only the Weibull algorithm appears usable (for predicting service parts failure).
  2. The database does not matter that much for running algorithms so that connecting to HANA is inaccurate. And the comparison of 40 hours to 2 minutes is asinine. That did not happen. And HANA’s is really only designed around optimizing analytics.
  3. The ML algorithms are not SAP’s, they are public domain. Secondly, the algorithms that SAP selected don’t appear to be ones that customers would want to use. Anyone can run these ML algorithms on data in their system without having to pay SAP anything, and HANA is irrelevant running ML algorithms. But why would any customer limit themselves to SAP’s incorrectly selected algorithms? Anyone can run a public domain algorithm on any data set without SAP being involved in any way.
  4. SAP is lying from 4 different dimensions all in one, and trying to take advantage of customer’s lack of knowledge around ML.

Financial Disclosure

Financial Bias Disclosure

This article and no other article on the Brightwork website is paid for by a software vendor, including Oracle and SAP. Brightwork does offer competitive intelligence work to vendors as part of its business, but no published research or articles are written with any financial consideration. As part of Brightwork’s commitment to publishing independent, unbiased research, the company’s business model is driven by consulting services; no paid media placements are accepted.

SAP Contact Form

  • Questions About This Area?

    The software space is controlled by vendors, consulting firms and IT analysts who often provide self-serving and incorrect advice at the top rates.

    • We have a better track record of being correct than any of the well-known brands.
    • If this type of accuracy interests you, tell us your question below.

References

https://www.asug.com/news/sap-predictive-analysis-what-it-can-and-cannot-do

https://towardsdatascience.com/a-tour-of-the-top-10-algorithms-for-machine-learning-newbies-dde4edffae11

https://help.sap.com/doc/6a2cd93857fd4973baa558931701afcd/1.0.3/en-US/654d095bd73a401fb789491a23fc5bb5.html

Enterprise Software Risk Book

Software RiskRethinking Enterprise Software Risk: Controlling the Main Risk Factors on IT Projects

Rethinking Enterprise Software Risk: Controlling the Main Risk Factors on IT Projects

Better Managing Software Risk

The software implementation is risky business and success is not a certainty. But you can reduce risk with the strategies in this book. Undertaking software selection and implementation without approximating the project’s risk is a poor way to make decisions about either projects or software. But that’s the way many companies do business, even though 50 percent of IT implementations are deemed failures.

Finding What Works and What Doesn’t

In this book, you will review the strategies commonly used by most companies for mitigating software project risk–and learn why these plans don’t work–and then acquire practical and realistic strategies that will help you to maximize success on your software implementation.

Chapters

Chapter 1: Introduction
Chapter 2: Enterprise Software Risk Management
Chapter 3: The Basics of Enterprise Software Risk Management
Chapter 4: Understanding the Enterprise Software Market
Chapter 5: Software Sell-ability versus Implementability
Chapter 6: Selecting the Right IT Consultant
Chapter 7: How to Use the Reports of Analysts Like Gartner
Chapter 8: How to Interpret Vendor-Provided Information to Reduce Project Risk
Chapter 9: Evaluating Implementation Preparedness
Chapter 10: Using TCO for Decision Making
Chapter 11: The Software Decisions’ Risk Component Model

Introducing Brightwork’s Deloitte Coupon for Terrible SAP Advice

Executive Summary

  • The SAP consulting companies charge top rates, but also offer the worst possible advice.
  • With the Brightwork coupon, SAP customers can now get 1/2 on the same horrible advice they have always gotten.

Introduction

At Brightwork, we provide analysis for companies evaluating SAP and Oracle. And in this role, we are exposed to the documentation and information that is provided to our clients by the major consulting firms. And how is the quality of this advice? Horrible! There are so many areas where the SAP consulting firms mislead their “clients” but here is a sample.

How SAP Consulting Firms Mislead Clients

  1. One of the first ways is that they do not declare their financial relationship with SAP. The firms make it seem like they represent their client’s interests when they represent their own and SAP’s interests over the client. SAP consulting firms will not help their clients negotiation against SAP, because that would harm their relationship with SAP.
  2. A second major way is the SAP consulting firm will mindlessly repeat whatever SAP says. No matter how inappropriate the application is for a client, the SAP consulting firms will agree with SAP’s presentation that the client should use the application in question.
  3. A third major way SAP consulting companies conspire against their accounts. The SAP consulting firms share information with SAP about the client, so that it may be leveraged by SAP. And they never tell their clients that they do this.
  4. A fourth major way is they communicate no realistic information about the success of SAP applications at other clients, in each case allowing SAP sales to exaggerate their success ratios. Literally, nothing is questioned,  SAP’s timeline estimates, SAP’s roadmap for products, SAP’s methodologies, SAP’s typical overrun on projects, nothing.

Deloitte and (fill in the blank) consulting companies are good little passive parrots for SAP. They provide heaps of false information to clients and lack any independence. 

Paying Top Rates for the Worst Advice

The advice from the SAP consulting companies creates a curious dynamic where clients pay top rates to get 100% biased information. The only goal of the consulting companies is to bill the maximum number of hours and to strengthen their relationship with SAP. And this is why we created the 50% off Coupon. Yes, with this coupon any SAP customer will get the standard garbage advice that benefits SAP and the consulting company over the client, but with the coupon the get 50%. And that is nothing to sneeze at!

Conclusions

The worst advice that benefits the consulting company versus the client is available in the open market of SAP consulting. There is a tremendous choice in the market. One can be lied to by Deloitte, Infosys, Accenture, IBM, and many other firms. So while the advice is horrible and entirely self-serving, at least SAP customers can choose who will lie to them. And with the Brightwork coupon, they can now get 1/2 off!

It’s a fantastic time to be an SAP customer!

References

SAP Contact Form

  • Questions About This Area?

    The software space is controlled by vendors, consulting firms and IT analysts who often provide self-serving and incorrect advice at the top rates.

    • We have a better track record of being correct than any of the well-known brands.
    • If this type of accuracy interests you, tell us your question below.

Enterprise Software Risk

See our free project risk estimators that are available per application. The provide a method of risk analysis that is not available from other sources.

Why You Should Treat SAP Sales Reps As Passive Order Takers

Executive Summary

  • Customers frequently overestimate the helpfulness of SAP sales reps.
  • We propose treating SAP sales reps not as advisors or as a friendly entity, but as passive order takers.

Introduction

SAP sales reps are set up as the go-to source of information for information about SAP products, pricing and terms, and conditions. In this article, we will layout why frequent interactions with SAP sales reps is not only bad for your mental health but leads to inaccurate information.

What Do SAP Sales Reps Know?

SAP sales reps are hired for their ability to sell. Everything else is secondary.

SAP sales reps will normally have never used an SAP product and don’t spend much time learning about the experiences of their customers with different applications and databases that they purchased. I have worked with many SAP reps, as a solution consultant and I don’t ask SAP reps questions (except about pricing) they ask me questions. So its odd that the customer sees the reps as a source of information (outside of pricing). As soon as a question is asked of a sales rep, they turn around and find someone they can ask. In fact, even pricing is often performed by a specialized pricing resource.

  • SAP Sales Reps and Technology: SAP sales reps generally know little about technology. If you spend time interacting with SAP sales reps (as I have), you soon realize that most of them are challenged by personal computing. SAP sales reps are significantly powered up by their solution consultants. Oftentimes when working with a sales rep I was told at a demo “At that point, you need to jump in because I don’t know that area.” 
  • The Tenure at SAP: Many SAP sales reps have short tenures at SAP. In another year or so, they may jump to Oracle. SAP has 309 products as we covered in the article How Many Products Does SAP Have? Most sales come from a much smaller sample of products, but the scope of SAP is overwhelming. I have been working in the SAP space since 1997, and the number of SAP products that have come and gone in that period is astounding. Products are constantly being renamed, even repositioned (Leonardo started off as IoT, but then morphed into predictive analytics and finally into AI). There is no possible way to understand the overall mix if one has worked in the space for a short period of time.
  • SAP’s Unicorn Based Sales Training: SAP sales training is ridiculously inaccurate. The tests cannot be passed by anyone who answers the questions with what actually happens on SAP projects. Passing the tests means agreeing with the test prep, which is a fantasyland creation of what SAP sales and marketing would like to be true.

What Do SAP Sales Reps Know About Your Business?

One of the ideas of a sales rep is that they will know your business and therefore be able to recommend the right thing to you. However, SAP is far too quota oriented for sales reps to fulfill this role even if they wanted to in other respects. With our clients, SAP reps make repeated mistakes around the environments of their customers where they have already had operating SAP systems for 10 or 15 years!

How can this be? It sounds impossible, doesn’t it?

Well, SAP reps frequently turn over, and the knowledge of the customer’s environment dissipates. Everything the SAP rep provides regarding the environment must be checked. It cannot be assumed that they have made the right estimations.

What is the Accuracy of Information from SAP Sales Reps?

Low. SAP is the lowest rated vendor in our Honest Vendor Ratings, tied with Oracle.

This is for several reasons.

  • SAP hires its reps without consideration for information quality.
  • SAP sales reps are themselves provided with heaps of inaccurate information by SAP.
  • SAP’s marketing literature is quite inaccurate. For example, we can find large inaccuracies in any SAP marketing document that is put in front of us.

SAP customers and prospects constantly complain about “inconsistencies” from SAP sales reps. We work for clients going through the procurement process and these “inconsistencies” consistently allow the sales rep to make more money. These inconsistencies can be users reclassified as a license they do not need, verbal assurances regarding indirect access that have no legal weight, exaggerations (pick your adjective) regarding product capabilities, overly optimistic roadmaps. The list goes on and on.

Every SAP roadmap makes it appear as if the product will take over the world soon. However, they are not reliable as a guide to what the product will be. They are in a true sense marketing and sales tools. Product managers at SAP know that the roadmaps are highly political documents. SAP also make a habit of stating the milestones on the roadmap as sufficiently vague, that it can be difficult to say for certain if the item was actually added in that release. This can be seen just from reading through this slide on S/4HANA’s roadmap. 

Treating SAP Sales Reps as They Should be Treated: As Passive Order Takers

SAP sales reps lack the technical expertise or the objectivity to be used to tell you what applications or databases you should purchase from SAP. As an example, S/4HANA still has significant maturity issues, but you won’t hear anything about this from an SAP sales rep. SAP sales reps too consistently mislead clients that we have had to be trusted to provide insight to the prospect.

The SAP sales organization is hierarchical and pushes sales reps to be a certain way, which is reactive rather than thoughtful. SAP is far too responsive to Wall Street and to the quarterly earnings hamster wheel to place their customer’s interests ahead of their own.

All of this adds up why in the vast majority of situations we advise companies to treat SAP and Oracle sales reps as passive order takers. Treating them this way is how they should be treated, and is what will allow the prospect to receive the best outcomes from the process. Ironically, the less that customers listen to SAP sales reps, the better they tend to do with their SAP investments.

Conclusion

This article is counter-intuitive. Customers are directed to “talk to their SAP rep” but what do you find out when you do? Deloitte has to direct them because they are just a consulting arm of SAP. Deloitte has a partnership agreement with SAP, as we covered in the article How to Understand the Pitfalls of a Vendor Partnership with SAP, and they value their relationship with SAP far more than with any one client. For this reason, the SAP consulting companies stay away from offering any advice that might contradict SAP or be seen as opposing their interests during the negotiation. The SAP consulting companies are financially motivated to push their client to get all the information from SAP. But we can say “wait, maybe you shouldn’t just “talk to your rep.” You need to go through the rep eventually, but you tell them what you need, they don’t tell you.

When we provide software selection support, we don’t spend much time talking to SAP sales reps. We did not ask them questions when we supported them in pre-sales engagements, and we still don’t. We already have access to the SAP information that we need, and our approach is to push interactions with SAP to later in the process. And we don’t care what the customer buys, and make no more money if they buy A or B, or 2 of A vs. 3 of A. By telling SAP what the customer wants to buy, it takes the inertia away from the SAP sales rep. At that point, it simply becomes a question about price, timing and terms and conditions.

Post Article

SAP sales reps and consulting companies will hate this article. They might point out that taking such an approach is not partnering with SAP, and will not result in getting what you need. Our experience says otherwise. Both SAP sales reps and consulting companies will dislike this article because it reduces their ability to control the account.

Financial Disclosure

Financial Bias Disclosure

This article and no other article on the Brightwork website is paid for by a software vendor, including Oracle and SAP. Brightwork does offer competitive intelligence work to vendors as part of its business, but no published research or articles are written with any financial consideration. As part of Brightwork’s commitment to publishing independent, unbiased research, the company’s business model is driven by consulting services; no paid media placements are accepted.

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  • Questions About This Area?

    The software space is controlled by vendors, consulting firms and IT analysts who often provide self-serving and incorrect advice at the top rates.

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    • If this type of accuracy interests you, tell us your question below.

References

Software Selection Book

SELECTION

Enterprise Software Selection: How to Pinpoint the Perfect Software Solution Using Multiple Information Sources

Mastering Software Selection

Software selection is a form of forecasting, just as any another purchase decision is a forecast of how successfully the purchased item will meet expectations. Forecasting is necessary because it is not feasible to implement each application under consideration before it is purchased to see how it works in the business.

The Importance of Software Selection

Software selection is the most important part of any software implementation because it is the best opportunity to match the software with the business requirements, which is the most important factor in determining the success of the project. This book explains how to get the right information from the right sources to perform software selection correctly.

What You Can Expect from the Book

Essential reading for success in your next software selection and implementation. Software selection is the most important tasks in a software implementation project, as it is your best (if not only) opportunity to make sure that the right software the software that matches the business requirements is being implemented. Choosing the software that is the best fit clears the way for a successful implementation, yet software selection is often fraught with issues, and many companies do not end up with the best software for their needs. However, the process can be greatly simplified by addressing the information sources that influence software selection.

This book is a how-to guide for improving the software selection process and is formulated around the idea that much like purchasing decisions for consumer products the end user and those with the domain expertise must be included. In addition to providing hints for refining the software selection process, this book delves into the often-overlooked topic of how consulting and IT analyst firms influence the purchasing decision and gives the reader an insider’s understanding of the enterprise software market. By reading this book you will:

  • Learn how to apply a scientific approach to the software selection process.
  • Interpret vendor-supplied information to your best advantage.
  • Understand what motivates a software vendor.
  • Learn how the institutional structure and biases of consulting firms affect the advice they give you, and understand how to interpret information from consulting companies correctly.
  • Make vendor demos work to your benefit.
  • Know the right questions to ask on topics such as integration with existing software, cloud versus on-premise vendors, and client references.
  • Differentiate what is important to know about software for improved “implement-ability” versus what the vendor thinks is important for improved “sell-ability.”
  • Better manage your software selection projects to ensure smoother implementations.

Chapters

  • Chapter 1: Introduction to Software Selection
  • Chapter 2: Understanding the Enterprise Software Market
  • Chapter 3: Software Sell-ability versus Implement-ability
  • Chapter 4: How to Use Consulting Advice on Software Selection
  • Chapter 5: How to Use the Reports of Analyst Firms Like Gartner
  • Chapter 6: How to Use Information Provided by Vendors
  • Chapter 7: How to Manage the Software Selection Process
  • Chapter 8: Conclusion
  • Appendix a: How to Use Independent Consultants for Software Selection

Who Wants Honest SAP Advisement Business?

Executive Summary

  • There are plenty of firms that perform SAP advisement, but the advice ends up being rigged due to financial incentives.
  • Large companies use advisement to provide advice that leads to other business.

Introduction

A large number of consulting companies provide advice and perform anything from software selection assistance to supporting various analytical initiatives. However, none of the larger, and very few of the others actually see themselves in the decision support business as a business. In this article, we will describe why this is such a problem.

The Financial Incentives at SAP Consulting Firms

In order to attain and retain a leadership position at an SAP consulting firm one must bring in roughly $2 million in revenues per year. There is no way to attain this quote by performing smaller projects, of which software selection and analytical initiatives would be examples. To attain this yearly quota, one needs to sell implementations. Decision support projects tend to smaller, shorter, and offer less stable consulting revenue. For a company with a significant overhead (offices, support staff, large senior member compensation) smaller projects of this nature are not sustaining.

Secondly, one of the best ways to sell implementations is to position oneself as a “trusted advisor” and then sell out the client’s interests by directing them to implement the most possible software. This means acting to promote SAP software, regardless of the fit with the client requirements, the cost, the maturity of the application, and another other factor related to things that make software a good match for a particular client.

The Implication of How Incentives are Structured

This means that SAP consulting companies are unreliable for providing software selection support as they have a massive financial bias. SAP consulting companies will claim major domain expertise as a reason for using them in an advisement capacity, but even the deepest domain expertise cannot overcome financial bias, and in truth, the decisions are normally filtered through the senior management of the consulting company, with little freedom given to the more junior members of the organization who possess most of the domain expertise.

An SAP consulting company may take the advisement or selection project, but only as a means to gain more future work. When they report back to their other senior members, success is measured by how much further business is obtained (at KPMG the catchphrase is “penetrate and radiate.”) The concept of providing objective analysis, and then rolling off of the project is only measured as a failure.

Having discussed this topic with several experienced consultants, we were told that recommending solutions on the basis of financial bias is “the way that it is.” And that further, it is a good thing, because the benefits flow to the consulting firm with the strongest relationship. The trick is not to tell the client that you are doing it. And this is considered perfectly normal in the SAP consulting field.

Conclusion

There is no feasible way for senior members of SAP consulting firms to attain or maintain their positions without putting their financial incentives ahead of their clients. None of the major SAP consulting firms and very few of the smaller SAP consulting firms have a model that allows for anything but grabbing implementation business by any means possible. And one of the best means is to pretend to provide decision support.

Financial Disclosure

Financial Bias Disclosure

This article and no other article on the Brightwork website is paid for by a software vendor, including Oracle and SAP. Brightwork does offer competitive intelligence work to vendors as part of its business, but no published research or articles are written with any financial consideration. As part of Brightwork’s commitment to publishing independent, unbiased research, the company’s business model is driven by consulting services; no paid media placements are accepted.

SAP Contact Form

  • Questions About This Area?

    The software space is controlled by vendors, consulting firms and IT analysts who often provide self-serving and incorrect advice at the top rates.

    • We have a better track record of being correct than any of the well-known brands.
    • If this type of accuracy interests you, tell us your question below.

References

Enterprise Software Risk Book

Software RiskRethinking Enterprise Software Risk: Controlling the Main Risk Factors on IT Projects

Rethinking Enterprise Software Risk: Controlling the Main Risk Factors on IT Projects

Better Managing Software Risk

The software implementation is risky business and success is not a certainty. But you can reduce risk with the strategies in this book. Undertaking software selection and implementation without approximating the project’s risk is a poor way to make decisions about either projects or software. But that’s the way many companies do business, even though 50 percent of IT implementations are deemed failures.

Finding What Works and What Doesn’t

In this book, you will review the strategies commonly used by most companies for mitigating software project risk–and learn why these plans don’t work–and then acquire practical and realistic strategies that will help you to maximize success on your software implementation.

Chapters

Chapter 1: Introduction
Chapter 2: Enterprise Software Risk Management
Chapter 3: The Basics of Enterprise Software Risk Management
Chapter 4: Understanding the Enterprise Software Market
Chapter 5: Software Sell-ability versus Implementability
Chapter 6: Selecting the Right IT Consultant
Chapter 7: How to Use the Reports of Analysts Like Gartner
Chapter 8: How to Interpret Vendor-Provided Information to Reduce Project Risk
Chapter 9: Evaluating Implementation Preparedness
Chapter 10: Using TCO for Decision Making
Chapter 11: The Software Decisions’ Risk Component Model