SAP has undergone some strategic changes in its management and operations this year. What will be your efforts to reinforce SAPs position in APAC region
SAP is a company of 63,000 people globally. We are also a company that is undergoing quite a significant transformation. And that transformation is taking our business from on-premise worldwhere you would purchase a hardware, purchase the services to implement the software and then you run the software yourselfto the world of cloud.
When you move your business from that kind of environment to this of environment, there are lots of changes. And inevitably as you make changes like thatthere are individuals who for their own reasons decidewell, I am in a different place in my career and not necessarily hungry to be part of that transformation in the company.
We have had some leadership transitions and we as a team are very focused in Asia particularly on ensuring that for every role we have in the company, every manager is mandated as part of their management objectives to have a successor identified. Because it is very important that you dont invest the strategy of a company either in a location or around the products in the identity of a single person that the machine of the company is put on an individual and it carries on.
Tell us something about SAPs services business.
From a services point of view, our strategy has always been to build an ecosystem around us and not to build that capability internally within SAP. We actually structure our services business so that we are only of a size where we can manage a particular proportion of opportunities in a market.
We have very comprehensive programmes for certifying companies and for certifying consultants in those companies for working side by side with them as we work together to achieve a customer outcome. What we try to do with our services business is to look at the skills in our teams and to look at where we require skills for new products. Because we should be the first people to introduce that to the market.
So high value consulting that puts the SAP stamp on what a partner is implementing for customer and we test if the customer is happy with that architecture. That ensures that SAP doesnt just sell some software; it handles the relationship to a partner and hopes the customer outcome is what we originally sold. Our preferred mode of operation is to have a role with the customer throughout their journey.
Our services business is an important component of our overall business but we always cap it at a particular percentage of growth, so that we can encourage and ensure that the partner ecosystem around us can grab it.
Social media, mobility, analytics, cloudtech majors seem to be smitten by these buzzwords these days. From a customer standpoint, where do you think these technologies are headed in the next 2-3 years
We definitely take an approach of not just looking at our customers, but our customers customers from many of the industries, thats the consumer. And let us put that aside for a second, key element of our consideration is the role the millennials will play in the workforce of the future and also in the consumption of software in the future. This is the generation of people who look down, never up.
I think the main change is that this will all become ubiquitous. We feel that the convergence of all these things into a single consumer experience will be the future. We are investing in our user experience labs to ensure that we have a consumer like experience even for enterprise software.
What will be SAPs business focus areas in India
We have had tremendous growth in India. Asia is the growth engine of SAP and as part of that growth engine, India as a business for us has enjoyed tremendous growth. We just finished Q1 and India continued to deliver great double digit growth.
When I look at it by industry or segment, I would say there are couple of key focus areas.
First is mid market. In India, there are numerous medium sized organisations that control a whole area of the Indian economy. What I see in those organisations are next multinationals; companies who may perhaps be in the domestic market today but will be on the international stage tomorrow, or who are domestic today but have global aspirations and that from a business point of view is a key focus for us. We have many solutions that are tailored at the mid market and that are priced appropriately for mid market.
Second is the public sector. We have invested to localise our software to Hindi because once you have a broad and unique footprint in the public sector, English doesnt cut it anymore as the language of business so, we made our product available in Hindi.
We have now understood, and have available in our software, all of the elements of functionality that are necessary to support the India government legislative framework. It means that when a public sector enterprise or public sector department of ministry chooses SAP, they do so knowing that the functionality of SAP has been tailored in India for the Indian context. There are lot of exciting opportunities for us not just in ERP, but also in the platform and analytics area for us in the public sector.
What will be your strategy going forward for the India market
Our focus has been to present the totality of SAP solutions. Applications and analytics in the middle on the HANA platform presented on any mobile device and our strategy has been to ensure that when we present that, we present it to a customer in context of relevancy to the customers. And there are two elements to the relevancy factorthe first element is the industry that you operate in and the second element is your role within that company or within that organisation.
Where is the cloud moving in India
I think it is more predominantly private sector now in India. There is absolutely an appetite for that. We had a triple digit growth in our Q1 in terms of the uptake of our cloud products. They are the public cloud products, those products that allow you to do standard processes using our SuccessFactors or our Ariba work. So there is absolutely a huge interest in India in innovating in that way, business processes and effectively putting the processes into that environment. I have not yet seen that in the public sector so much in India. In fact from a public sector perspective the only country that has made a move with regards to cloud, a significant move, it is Australia.