We are live from Sapphire Now 2018 in Orlando, Florida.
I'm Michael Krigsman.
I'm an industry analyst and the host of CxOTalk.
I am delighted right now to speak with the chief information officer of SAP, Thomas Saueressig.
Hey, Thomas; how are you?
Nice to meet you, Michael.
Tell us about your role as CIO.
Yeah, so the role, actually, fundamentally changed in the last couple of months, quite
significantly, because if you think about all this move to the cloud, I think you recognize
IT is actually becoming part of the core value chain of the company and also, actually, quite
frankly, part of the product itself.
Now, I'm also responsible for the customer experience of SAP from a technology perspective
and the global cloud infrastructure of SAP.
All our 150 million users of SAP are run by my IT organization, 22 U.S. … (indiscernible,
0:00:59) operations as well.
The role of IT has dramatically shifted from, say, infrastructure to now where you're an
integral part of the customer-facing product and operations of SAP as an organization.
Absolutely.
You're spot on.
That is exactly the point.
I believe, from an SAP IT perspective, we actually influence the product strategy and
are part of the product: two examples of what we do.
On the one hand, as a customer, if you purchase Concur, Fieldglass, Ariba, S4, C4/HANA, and
the likes, we need to ensure that all of this is working in harmony and that we can provision
it everywhere around the globe, and you have great performance.
As we run, we have so much insight into the portfolio and into the integration topics,
we actually defined, for instance, the integration from Ariba to S4.
This integration was defined by the IT organization and is now the standard integration of SAP
itself.
That's very unusual because we think of IT as being internally focused on the infrastructure,
and it's very unusual for product infrastructure to be part of the IT organization.
Yeah.
Basically, we have two reasons why we did that.
The first reason was, we wanted to centralize all the global cloud infrastructure of SAP
and, likewise, we also went with the multi-cloud strategy, which means we partnered strategically
with Microsoft Azure, with Google Cloud Platform, and with AWS.
When you adopt software-as-a-service solutions, actually, in a company, you can also, for
sure, free up capacity, which you can then leverage for these additional tasks.
What are the drivers that make IT relevant?
I think an IT organization should be the best prepared to think about how I can use technology
in a smart way for greater impact to the company and to the customer.
The IT organization also needs to rethink their role, getting away from the classic
auto ticker, which they were in the past, to also proactively really see how they can
make use out of the new technology because, talking about artificial intelligence, talking
about augmented reality, talking about also blockchain and the likes, fundamentally exciting
technologies, but it's important that you put it in the right business perspective to
think about how you can, instead, improve, at the end of the day, the value to the customer.
The coming together of business and IT, digital seems to be the driver that enables this.
Maybe you can explain why digital creates this opportunity for IT.
I'll give you some examples.
We have customers who sell, basically, heating solutions in Europe.
But, fundamentally, instead of just selling the heater, they basically sell the entire
maintenance on a regular basis, but also now think about in every house you have heaters.
Think about the smart home topic now.
They are in every home already because every home has a heater.
This is a totally different business model thinking about smart homes, IoT, leveraging
the topics for a services business, which they now run, at scale and it's growing tremendously.
What are the reference points that you use as the anchors or the pillars?
We use the 3M index, which is an industry benchmark index.
Two years ago, we had a score of 70%.
Two years later, we achieved a nine percentage point increase, and we're 79% of the 3M index
score.
We're now one of the top 5% of all IT organizations on a global scale - top 5%.
We really are proud of our IT organization.
Let's talk about customer experience.
Why is IT involved, and how is IT involved in customer experience?
For me, customer experience, you also need always to look at end-to-end, which means
the first touchpoint is of any individual who is kind of visiting our Web page, and
we don't have an information purpose except the IP address.
This relationship is growing because he's downloading a white paper.
We get some more information.
Basically, you see a growing information and growing relationship over the time.
It starts with the first touchpoint on a Web page, and it hopefully ends with this customer
has interest to get a trial system.
Then he most probably will turn a trial system into a productive system.
Then we have a contractual relationship, and he's entered into it.
Then he will receive services, and we will need to help him to adopt our solutions with
customer success.
If he has an issue, for sure, we need to provide the right level of support, end-to-end.
We basically enable all of that.
It's always from the reference point of that customer.
It's not from the IT perspective.
No.
It's from the customer perspective.
End customer.
It's the end customer focus, which we need to have.
We always need to, if you want to optimize it, think in the shoes of our end customers.
You're also responsible for the infrastructure here, and there are 25,000, 30,000 people.
Absolutely.
So, it's like a city you've created.
Tell us briefly about the infrastructure here.
We have an event IT organization, which is running more than 300 events a year.
Most of the colleagues here, which support Sapphire now today, actually fly tonight to
Hannover where the CeBIT will run next week for the preparation there.
If you walk through the show floor at Sapphire, you need to have a great digital experience.
We directly scan how long the people are visiting one booth that we can have real-time metrics
to see which demo is getting the most interest to ensure that we optimize the entire show
floor real time.
That's what we do this year so that you don't have these boring, old scanners, which you
had in the old days, where the people came to you and asked you, "Oh, can you give me
your badge?" and I scan.
These days are gone.
You just walk through the show floor and, with modern technology, we directly track
all the different dimensions and recognize patterns and interest for specific sessions,
demos, and the like.
It's exciting, and IT is basically, again, the enabler of this customer experience, which
you see here at Sapphire.
Fascinating.
Thomas Saueressig, thank you so much.
Thank you so much.
It's good to see you again.
It was a pleasure.
Thank you.