22 Feb SAP results and our own experience confirm continuing rise of cloud and HANA
SAP results and our own experience confirm continuing rise of cloud and HANA
We weren’t surprised that SAP posted another set of highly respectable financial results for 2017.
After all, that company makes the world-leading enterprise software for business operations and customer relations we recommend, install, maintain and upgrade. We therefore need no convincing about the quality of its products.
SAP’s total revenue rose by six per cent and its earnings-per-share by 10 per cent during the year, for example, while it’s operating and free cash flows increased by nine and four per cent respectively.
Behind the bare figures, however, the increasing impact of the cloud and the integrated range of tools known officially as SAP Business Suite 4, and for short as S/4HANA – because it runs on the SAP HANA database management system – was all-too-evident.
The company’s experience echoes the ever-growing importance of the cloud and SAP HANA – in our opinion today’s most advanced application of its kind – to our customers and to our own business.
SAP’s cloud subscriptions rose by 38 per cent during 2017, with revenue from new cloud bookings increasing by 26 per cent. In addition, cloud and software license sales grew by 17 per cent, year-on-year, with cloud and software revenue rising by six per cent.
Our own growing involvement with the cloud stems from us last year becoming the world’s first organisation to launch a cloud-based version of the SAP Business Planning and Consolidation (BPC) system. This breakthrough followed our conclusion of the first agreement globally for SAP BPC in the Partner Managed Cloud software-as-a-service model with the manufacturer and investment of £500,000 in its development.
This cloud-based solution, which abolishes the need for expensive hardware, contains a suite of financial consolidation, budgeting and forecasting templates. It includes EU General Data Protection Regulation-compliant detailed headcount planning and generates all essential reports “out of the box”, its ultra-rapid Go Live in a Day™ templates complying with the latest International Financial Reporting Standards including a module which supports the new IFRS 16 lease accounting standard.
The most eye-catching single figure SAP announced in its results was the 46 per cent year-on-year growth during 2017, to over 7,900, in the customer base for S/4HANA.
SAP HANA, which is clearly crucial to this success, powers our own cloud-based BPC solution, but we also sell, install and maintain it independently and provide other services and support for it, including appliances. We can therefore help, whether the platform is working with the BPC system, as an on-premise or cloud option, or any other product…including, of course, S/4HANA.
We’re a SAP Value-Added Reseller and specialist managed cloud hosting provider for SAP HANA, with the ability to add services or features to the system, based on client needs. We’re also a Partner Centre of Expertise for the application, a designation awarded only to the best-qualified implementation and support practitioners.
SAP has said it expects its cloud revenue to outstrip licensing income for the first time in 2018 and to have migrated at least half its existing installed base onto S/4HANA Cloud by 2020.
It therefore clearly expects the cloud and HANA to continue being dominant themes in its operations for some time to come. It’s a pretty safe bet that the same will apply to us.