Category Archives: Information Technology

Coffee Break with Game Changers 2014 Predictions Pt 3 – More on Convergence Forces

The popular internet radio talk show program hosted by Bonnie D. Graham returns for its third full season of predictions and trends which will impact business and technology. What will be the disruptive factors in the market in 20-14? I joined Bonnie and the panel during the fourth segment around 56:00 with my take on “convergence forces” to beg the question “can you fish in a tsunami?”

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My opening statement – besides my annual holiday Irish Cream recipe which you can find elsewhere on my blog – is summarized below. You can also find more on this blog and on my SCN page.

One of the big news stories in strategy, innovation and tech circles is the growth and convergence of four key trends from the past two years. These trends – social networking, mobile computing, cloud applications and big data – are not new.  In fact our firm covered these extensively in 2012 and continue to advise clients on how to leverage these trends strategically, both individually and collectively. What is occurring now as we move into 2014 is the cumulative effect of these trends into force directions of their own.  These so-called convergence forces – or what Gartner Group calls nexus of forces (NOF) – have a tendency to amplify and extend innovation in new and more powerful directions, much like strong winds, lunar position, and seismic disturbances can affect the behavior of ocean tides.  To put it another way, you might be able to plan to fish based on high tide but planning to fish during a tsunami is, well, a bit more complicated.

You can plan to fish in a high tide but fishing in a tsunami is a bit more complicated.

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Convergence Forces – The Coming Ethics Debate on Predictive Analytics and Location Based Services

One of the big news stories in strategy, innovation and tech circles is the growth and convergence of four key trends from the past two years. These trends – social networking, mobile computing, cloud applications and big data – are not new.  In fact our firm covered these extensively in 2012 and continue to advise clients on how to leverage these trends strategically, both  individually and collectively. What is occurring now as we move into 2014 is the cumulative effect of these trends into force directions of their own.  These so-called convergence forces – or what Gartner Group calls nexus of forces (NOF) – have a tendency to amplify and extend innovation in new and more powerful directions, much like strong winds, lunar position, and seismic disturbances can affect the behavior of ocean tides.

Photo credit, Cisco Systems.

One of the areas where we are seeing this play out is in the business to consumer pricing strategies of in-store retail.  Location based services – either by way of opt-in applications or mobile browsing cookies – allow known customers to log-in to store applications and view special VIP promotions, to quickly locate where items may be found in the store, and to recommend products which based on sentiment analysis and buying pattern might be of interest to the customer.  Location based predictive analytics can also help retailers determine the best location in a particular store to position items based on customer traffic (using big data to monitor your path via GPS as you actually browse the store or predict where you will go based on history and profile) as well as to dynamically create promotions based on your position and buying status.

Creating special offers and promotions based on an existing relationship is not new in the business to business world.  Suppliers and customers alike receive special treatment and extended services and bundle pricing based on volume of sales, excellent quality, and other relationship management KPIs.  In fact in the world of wealth management and retail banking, customers may find that with particularly large financial institutions the first question they are asked after pleasantries may be “what is your current relationship with us?” While this is hardly endearing to the uninformed, it does grant status to those who may, have for example, several accounts, a loan, a trust and other financial products all aggregated under the same customer portfolio with a particular financial institution.

Where things may run amok in the future is when customers (a) receive deferential pricing based on relationship without permission and (b) when a relationship is implied based on socio-demographic profiling or  when facial recognition technologies are employed.  Let me give two very possible scenarios.  I have an account at a sports and recreation retailer and I walk into the store. As a member I have given them permission to my specific profile information (where I live, what I purchase via history, my demographics) in exchange for an annual dividend at no fee.  The retailer has the ability while I am in-store to make me aware of specific items I might want and key promotions going on at that store on that day.  What the retailer can do is also annotate the base price while I walk through the store.  Meaning that what price I may see before logging in and what price I see after I log-in may be different.  Imagine digital price tags changing and updating dynamically as I walk through the store.  Now in this scenario I am going to assume that the incentive I have to purchase items is a benefit versus a cost so I assume that the store is truly giving me a deal even if they don’t.

Another scenario gets more futuristic but again the convergence forces suggest all plausibility.  I walk into a store that I don’t actively have a relationship with nor have I given permission to share my profile and demographic information.  However due to advances in facial recognition technology (such as what is available in Facebook and other applications commercially), the store can tap into vast image databases and make a best estimate at who I am based on my movements in the store and camera images obtained while I move throughout the store.  This correlation of implied relationship and implied demographics can, under the proper scenario, suggest promotions and product recommendations not aligned to my actual relationship nor my actual demographic and in extreme cases improperly tweak dynamic pricing levels.

While this extreme case is just that, convergence forces already have the attention of retail strategists, ethics experts, media tech publications and even sparked political debate. Earlier this year, U.S. Senator Charles Schumer (D-NY) suggested that analytics companies engaging in such practices without customer knowledge would be “intrusive and unsettling.” prompting the Senator to issue a statement with eight of the key location analytics companies in this space to a new code of conduct which would discourage such practices. Other industry segments have also begun to weigh in on the legitimate and ethical use of predictive analytics including higher education, which can use the technology as a early warning system for right-tracking student performance through degree programs.

Convergence forces in this area have already begun and the debate is reaching the mainstream.  What are your thoughts? And – outside of leaving your phone in the car or forgoing permission to give your profile information to any customer loyalty system or social media site – how do we as consumers protect ourselves from retail profiling when we don’t want it?

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SAP NetWeaver Gateway PAM – A New Productive Approach for Microsoft Users

I was happy to participate at the recent SAP TechEd US in the product roll-out of the new  SAP NetWeaver Gateway Productivity Accelerator for Microsoft, or SAP Gateway PAM.  What is SAP Gateway PAM and why is it important?  From a forthcoming white paper, some specific background:

Today’s labor force is different. Knowledge workers demand easy and transparent access to critical business information in order  to complete their jobs. As such, line of business owners must take responsibility for their own employee retention. Business users, particularly the Millennial workers (generally considered those born between 1979 through 1999) who are making up more and more of the workforce, grew up learning how to play and fun was part of their learning pedagogy and educational upbringing.  So line of business owners need to make work fun and easy and for this IT must be in partnership with the business.  Whether it is via on-premise , on the cloud or mobile applications, business information must be quick and easy to access in order  to complete day to day operational tasks, and done so in a secure, easy to maintain manner across the entire enterprise software landscape.

Knowledge workers also have a tendency to prefer to work in teams rather than alone. As such, performance management systems which place much of the emphasis on independent contributions will give way to more team-based and group performance approaches.  Despite these trends, research has shown that line of business owners have a “hazy understanding” of what is needed to address this shift in worker business practices. This “lack of clarity” on the part of line of business owners is partly because knowledge work involves more diverse tasks than does production or clerical work which can be procedural and repetitive.

Since knowledge workers spend half their time on interactions, research suggests that companies should first explore the productivity barriers that impede these interactions. Common barriers may include lack of clearly defined expectations and outcomes, competing information sources for executing work tasks, and basic information accessibility issues.  The work environment itself may pose a barrier, whereby overly structured processes and systems deter knowledge workers executing tasks in team-based environments.

With this shift in worker behavior, performance metrics are hard to come by in knowledge work, making it challenging to assess how effective particular individual knowledge workers may or may not be against poorly defined goals and objectives.  Against this backdrop, it’s perhaps unsurprising that many companies settle for “scattershot investments” in staff development and corresponding IT systems and processes rather than to consider a cohesive environment that clearly supports knowledge worker behavior.

In recent years, many companies and research firms have taken a hard look at the need to increase accessibility of critical business information that exists in SAP Business Suite solutions and SAP data structures like HANA and BI across lines of business and functions in its many customer organizations.  By studying the demand for information  and the use modes of that information, SAP has determined that there is a “gap” between the accessibility and the use of business critical information.  In an ideal situation, all workers should be directly connected to the SAP back system to access information directly and quickly in order to execute processes efficiently. However for the majority of SAP customers only 25% percent of the business users are directly working on the SAP systems.  Given that over 400 million users access Microsoft Outlook.com email services and 1 billion Microsoft Office licenses currently exist worldwide, it is easy to see how a typical SAP customer would have business access to Microsoft based productivity like Microsoft Office, Microsoft Project, and Microsoft Excel.  In addition, these business users are increasing their day to day consumption of business critical information via mobile channels, with more and more information consumed via smart phones and other mobile devices.SAP believes that by 2018 over 50% of business users will access SAP business critical information via non-native user interface (UI) modes, further increasing the need for broad integration between SAP Business Suite and Microsoft environments.

In response to this need, SAP has developed a solution that provides an extended set of tools and connectors to easily create bi-directional communication between the SAP Business Suite stack and Microsoft platforms in a secure, development friendly approach.  Called SAP NetWeaver Gateway productivity accelerator for Microsoft (NetWeaver Gateway PAM), this new platform builds on the recent design improvements of the overall NetWeaver release with additional pre-configured extensions specifically for use in Microsoft application environments.  Using .Net programming options via its Design Studio and open data (OData) protocols, developers already familiar with the Microsoft stack will be able to quickly develop new and enhance existing extensions from SAP Business Suite applications directly into Microsoft user environments via Gateway PAM.  As such SAP NetWeaver Gateway productivity accelerator for Microsot becomes a single, unified and fully secured platform to bring the SAP and Microsoft environments  together in the lowest integration cost model developed to date.

SAP NetWeaver Gateway Productivity Accelerator for Microsoft (SAP Gateway PAM) allows for easy integration for Microsoft productivity tools such as Microsoft Office, Microsoft Project and Microsoft Visio.  Through the use of pre-configured extensions into these applications, workers connect to critical business information stored in SAP Business Suite solutions in a low-cost, highly transparent manner.

Ning-Jing Gao from the SAP Information Worker Unit interviewed me on the SAP Technology channel after I had an opportunity to review the release materials. Watch the full YouTube interview, below.  This is a next big step towards seamless UI and data integration between SAP Business Suite and Microsoft productivity applications.

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KXEN brings SAP Analytics to the Business Analyst Community

This week in Las Vegas I held a number of executive interviews as part of my role with the SAP Business Influencer community at TechED.  I’ll be posting on the SAP Community Network with abstracts here to link to the full content.  

This week at SAP TechED, the KXEN team was in full force both demonstrating the continuing value of the brand which SAP acquired last month and also their new SAP employee badges after cutting over to their new teams inside the SAP Analytics group earlier in the month.

According to Saravana Chandran, Senior Director for Advanced Analytics, SAP had good position with the up-market visualization space with its Lumira product and relatively good penetration in the statistician and data scientist market with its predictive analytics tools.  What KXEN brings to the table is the middle ground of business analysts who look for trends and forecasts as part of their day to day activities but who are not overtly looking to dissect the data into complex and reusable algorithms like statisticians.

“The vision of SAP Analytics is to reduce the data to decision latency, operationalize predictive model, and bring predictive analytics to broad set of users – beyond the data scientist while being open and flexible” claimed Chandran in my business influence interview this week at SAP TechED.  “Customers can leverage predictive models and extend the usefulness to the end user across all levels of expertise.  So you can democratize analytics and overcome the skills gap in today’s environment” where either the data is too complex (requiring more data scientists) or the application to simple to drive real trends and value to business decision making.  Chandran claims that due to the skills gap currently in the market, for every $1 spent on solutions an additional $99 is spent on services needed to use those solutions productively.  In today’s world you need to hire data scientists or bring in service providers to perform necessary analysis over time, pricing many companies (even large enterprises) out of the predictive analytics space.

To read the full article, including an embedded YouTube interview with Chandran and KXEN VP of Product Management Marco Casalaina, visit the SCN posting.  Thanks to Chandran and Charles Gadalla for their time to sit together and talk about predictive analysis at SAP TechED.  Follow my other SCN postings via my SCN profile page or Twitter (@william_newman).

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Day 2 #SAPTechEd Live Blog

Here at SAP TechEd I’ll be mixing up a few blog posts with the streams from the day’s events as they occur and as announcements made. Follow me here and on Twitter (@william_newman).

Yesterday’s flurry of announcements around the new and open capabilities started strong in the morning and continued into the evening with a 10-year birthday celebration of the SAP Community Network.  Congratulations to Chip Rodgers and his team for a vibrant knowledge exchange!

A summary of key announcements, with links to be added as and when they become available:

  • Integration of the Hana Enterprise Cloud Platform with Hadoop, SaaS, with scalable sizing with multiple on-ramps for companies of all sizes depending how they would like to amortize their IT assets (or not).
  • SAP Mobile Platform 3.0 releases this week.  Lots of clean up and deeper extensions for mobile processes.  SMP 3.0 is the first release where mobile processes do not need to explicitly connect to back end business suite applications, since they are able to update the table directly.  Don’t have that process in business suite? It’s okay as long as you have good mobile data governance.  (Addresses the classic joke scenario: hey doctor, when my arm heals can I play the violin…. good because I wasn’t able to before … Now SAP customers can build apps to handle processes not found in their Business Suite environment, unencumbered by other enterprise architectural constraints I outlined in one of my earlier articles.) Also better control of renegade or so-called “zombie apps,” forgotten mobile apps from old BYOD and other development efforts still running and still consuming data.
  • Netweaver Gateway’s new release leveraging Open Data (oData) protocols allows for a fresh look at Microsoft integration.  With the new NWG Productivity Accelerator for Microsoft (called Gateway “PAM”) services can be delivered directly to Microsoft applications without the need of a server broker on the Microsoft side.  Lower TCO with higher accessibility to SAP operational data through Microsoft product environments, including a near-term SP1 release to connect Excel.  Plug-in friendly.
  • Cloud convergence became clearer.  Sven Denecken presented an update to the cloud roadmap and it is clear the SuccessFactors underlying architecture which is LOB-driven will be primary with modules reflecting Business Suite applications in ByDesign (ByD) will build on that architecture.  SAP has determined that its cloud EA footprint doesn’t need to be an either/or proposition.  This is good news for current and future SAP customers looking to migrate some business processes or entire operations to the cloud.

More information updated here as and when it becomes available.

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What to Look for: Microsoft Accelerator to be announced at SAP TechEd

Having just cleaned out my gear bag from this year’s Detroit International Half Marathon in the D, I am with keyboard in hand providing a few snapshots of what to look for next week at SAP Tech Ed.

First there will be more on Hybris and omnichannel marketing.  A lot more.  Since the announcement earlier this year a number of partners have come forward to address key scenarios.  This came up in my recent SAP Radio spot in a conversation around purposeful millennial consumers and how companies can weave corporate responsibility into their consumer facing strategies.

More cloud competition and predictive analytics, specifically around the kxen acquisition.  The acquisition is scheduled to be completed this month and since we are in the quiet period we haven’t heard much about roadmaps or strategies.  This could change at TechEd if the “all clear” is given to consummate the deal.  Could be newsworthy.

The clever folks in the NetWeaver Gateway team are releasing a new Productivity Accelerator for Microsoft (PAM).  Why the buzz?  Unlike other joint ventures with our friends at Microsoft, the NW Gateway PAM is a bi-directional environment with plug-ins and add-ins to Microsoft Office leveraging open data (oData) protocols.  This allows direct connectivity with Microsoft platforms, without “double conversion” via a Microsoft system. Accelerators much like “starter kits” in other SAP products means developers have pre-built handles unlike other previous approaches.  SAP hopes to tap into the estimated 65% of the SAP customer employees who currently use Microsoft products but currently don’t access SAP enterprise data in their day to day tasks.

A number of sessions including a customer small group discussion with Dr. Pepper Snapple are planned for the NetWeaver Gateway and Duet Enterprise teams.  You can see a full schedule at their SCN post.

Follow me on Twitter (@William_Newman) for more updates throughout the week.

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Snowden Case Illustrates Gaps in Governance Policy

While the world watches Edward Snowden and his serendipitous travels and possible end game as he faces charges of US espionage at home, the security world has been asking the same question since the Guardian made its bombshell disclosures: How did this happen?

Photograph: The Guardian/AFP/Getty Images

Indeed despite any personal views on whether Snowden is a whistle-blower, a spy, or a confused young man one thing is certain.  With a relatively low analyst role inside of the National Security Agency (NSA), Snowden had access to large data piles of sensitive information – both metadata as well as content data – on the US surveillance programs.  While the deep content data was under the auspices of US government efforts to get a handle on thwarting terrorist attacks and cyber espionage from commercial and political entities, it illustrates what can happen when large organization do not pay attention to those able to come and go from their own systems and what information they can see.

Commercial organizations have been dealing with this problem for the past two decades.  In the outsourcing shift of the late 1990s and early 2000s, American and other Western-based companies looked to offshore security, network administration, and call center services to countries with lower wage knowledge workers.  Countries like Brazil, India and China began to sprout data centers and call centers creating huge demand for trained and skilled tech workers.  While many of these workers used their positions to eventually emigrate to developed nations, many remained close to families and absorbed good-wage, local jobs with very exciting large, multinational corporations.

And that’s when the fun stopped.  Once in, unless you have multi-tiered governance and access models over all systems users, these third party offshore providers found there were ways to increase their value by siphoning off intellectual property (IP) for use with related home country industries.  Granted the vast majority of offshore information technology providers were of good repute and legitimate in their contracts and task execution.  However while working for a government contractor – a large multi-national subject to ITAR and other commercial export and technology transfer laws – the candy store was discovered not only open but unlocked.

It seems in their haste and desire to spin-0ff a large offshore company that had been created for the purpose of taking care of their systems in a joint venture, headquarters personnel of this multinational corporation became aware of unusual logs in the use and view of certain key data files.  These files related to the design and manufacture of product governed by commercial and government controls, and did not have anything to do with the core systems management processes the offshore company was now contracted to provide and maintain.  In short, network administrators had such broad access based on the definition of their user profile they could essentially view, edit, delete and copy any product related files.  This led to a large discussion and renegotiation of the service level agreement between the multinational and offshore provider. Eventually a domestic systems management services provider was contracted to take on the network care over product and manufacturing data.

There will always be the Edward Snowden’s of the world, who feel they must act on what they see or re-purpose information that is available to them.  However with greater governance and controls of information policy we can limit the availability of future Snowden’s to have full visibility of information that is not on a need-to-know basis.  We have the tools and methods available to put these governance policies in place.  In both government and commercial sectors, responsible management is needed to do so.

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Can Supply Chain Visibility Save Lives?

My recent SCN blog post “Focused Brand Management via Supply Chain Visibility” has received nearly 1,000 views since it was posted earlier in the month following my interview with Markus Rosemann, Head of Supply Chain Execution at SAP during the SAPPHIRE Orlando conference.  It is provided here as an abstract to create visibility in non-technical circles so we can all consider if increased supply chain visibility can detect issues before they occur. Or kill. 

Read the full article on SCN under the Business Trends topic for Sustainability and Supply Chain.

Rena Plaza collapse (image courtesy NY Times, Reuters)

In the wake of devastating tragedies in Bangladesh and Paskistan over the past 18 months, OEMs are developing action plans and mitigation strategies to avoid collateral brand damage associated with poorly run and often dangerously unsafe external contract manufacturers.  During my recent podcast for the IXN (Episode IXN002 on iTunes) I was asked what is the top challenge facing global supply chains.  My answer was terrifyingly predictive: brand management and the impact it has on brand sales when a horrific event happens overseas.  Two weeks later, over 1,000 workers (mothers, fathers, sisters and brothers) lost their lives in the building collapse at the Rena Plaza factory in Bangladesh.  While the death toll rose, Disney was one of the first brands to pull out of the country, and the EU developed a memorandum of understanding that many appareland footwear manufacturers were voluntarily adopting.

This week at SAPPHIRE I sat down with Markus Rosemann, Head of Supply Chain Execution, LOB Solution Management, to discuss this problem.  Given the actions of the previous several weeks this issue is top of mind in supply chain operations and risk management functions inside, it was a familiar topic.

Integrated supply chain issues for brand management is a critical success factor because as Rosemann put it, “you cannot lose on this front. How you integrate with your partners is a growing need, not only the process and order level (for example, who was manufacturing on Bangladesh and what percentage of your portfolio), but also the need for the supply network to create visibility.” While this has been an issue for years, the impact on brand management today creates a new need to track and trace supplier activity so companies can protect their brand.

Social and sentiment analysis can also play into that from a demand signal management perspective. Social plug-ins can see the sentiment analysis on brands, platform, and customer preferences. So what does this mean having a true voice of the customer in the wake of a horrific supplier event?  According to Rosemann, “that is finally changing, best margin is not the only driving force” in industries such as apparel and footwear. “This is an area that we see changing in the market place – demand patterns which are changing, and this can all be viewed inside real-time analytics. We see this as a huge opportunity to leverage the power of HANA, for massive data which can be analyzed and understood. From this, information can be pushed onto strategy, supply planning, and then sourced.  This is the real integration and opportunity for a real time supply chain.” I agree and none too soon.

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This Week at SAPPHIRE / Wednesday May 16

This week during the ASUG Annual Conference and SAP SAPPHIRE program, I will be providing a summary of key announcements, trends and discussions each day. For more detailed information and analysis please refer to the content links that will be updated and added into this post and at my SCN blog.

Wednesday this week SAP Co-CEO Jim Snabe challenged everyone to consider their “inner tiger” and build innovation through the capture of human talent. Focus of the conversation was clearly on the SuccessFactors brand and their platform of services.

Later in the day, Sven Denecken provided an update on the SuccessFactors portfolio of cloud based applications for both private and public cloud offerings. With a focus on People, Customer, Money, and Supplier. (Sounds a bit like core data entities, doesn’t it?) From his perspective, Denecken was clear that SuccessFactors was not a “rip and replace” business model. Most cloud based customers are looking to enable key functions or processes in the cloud in slices rather than a complete removal of core on-premises systems.

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My personal meeting with Sameer Patel, Global Vice President of Enterprise Social Solutions focused on how SAP Social solutions – particularly SAP Jam – help get work done. SAP Jam designers followed the day in the life of customers across business processes to determine the social touch points in key business processes and have created collaboration points inside of SAP BusinessSuite and LOB Solutions. So social collaboration is not another “layer” or outside of core processes, it is fully integrated in work steps of core processes. My article on SAP Jam and a compare and contrast to the structure of StreamWork will appear shortly on searchSAP.com (I will post the link here when available).

Finally I had the true pleasure to meet Bill McDermott again after nearly 10 years. Bill was a VP of Sales US at the time and I was still at Volkswagen and we met at a customer reception in Chicago. It was a long time ago and we were both a little shorter in the tooth back then. Bill established a cancer research foundation in honor of his mother who passed away from pancreatic cancer. A well known story is how Steve Jobs, who succumbed to the same cancer as Bill’s mother, shared a long discussion on the fight against the disease. Bill is a gracious man and his commitment to hire and promote inside SAP that culture has created a VP layer with great integrity which will serve the company well in the future.

Up today is the always lively Dr. Hasso Plattner and CTO Vishal Sikka who will provide a technical overview of HANA and SAP future direction. And maybe there will be some sparring with competitors tossed in for good measure.

(Photo credit: Timo Elliott … Thanks Timo!)

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This Week at SAPPHIRE / Tuesday May 15

This week during the ASUG Annual Conference and SAP SAPPHIRE program, I will be providing a summary of key announcements, trends and discussions each day. For more detailed information and analysis please refer to the content links that will be updated and added into this post and at my SCN blog.

As Day 2 of SAPPHIRE rolls in, we heard some pretty big words around massive real-time data analytics and predictive behavior.  Bill McDermott’s keynote emphasized this point with venerable sports anchor James Brown joining a team of executives from the NBA, the San Francisco 49ers, and Under Armour who through the use of HANA and real-time data feeds are pushing new and more connected consumer applications to the market.  In this space, SAP hopes to capture the “customer’s customer” by enabling massive data sets in real-time, in-memory so that humans can digest what they want, where they want it and how they want it.  McDermott also called the Millennials “the most important generation, they use social as their dial-tone and we need them to answer.”

Other highlights from yesterday include my interview with Markus Rosemann from SAP LOB Supply Chain.  In the wake of such devastating plant fires and building collapses, we spoke on brand management and key functions of SAP SCM which, now enabled by HANA, OEMs can make decisions like sourcing share, capacity balancing, and portfolio balancing in real-time with the help of public sentiment and opinion.  This is important since supplier visibility – when enabled by real-time analytics – can deter supplier issues proactively.  And save lives.  The full interview is now available on the Business Trends Forum of SCN.

Yesterday I was also joined by Ella Morgulis and Himanshu Pande from the Information Worker group were we joined Tom Wailgum on ASUG News TV to discuss Duet Enterprise strategies, NetWeaver Gateway, and the Millennial Shift in workers to new UX designs. Look for our interview at the ASUG News site this week.

Today I’ll be hosting an ASUG round table, a “birds of a feather” session on mobility, HANA, and upgrades at the ASUG Community Lounge, CL14 on your program.  There will be door prizes – must be present to win!  Enjoy Day 2 of SAPPHIRE.

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