SAP is a big company—and we mean really big—generating more than 23 million euro in revenue in 2017 with as many as 100,000 employees worldwide. That’s a good thing, because the lion’s share of SAP customers today are comparatively large-scale enterprises. Big software suites suit big business. It’s not hard math.
At the same time, SAP wants to make sure that it’s not forgetting about the many other small- to medium-sized businesses (SMB) out there. Depending on which organization’s definition you wish to follow (for example the World Bank, the OECD, or the U.S. Small Business Administration) a small- or medium-sized business will typically have hundreds of employees rather than thousands. And what we all typically think of as “small business” would actually be thought of as “micro” on the SAP customer scale. SAP considers any business making up to $1B in revenue each year part of the SMB category, to put this into perspective.
Given this, you may think that SAP products and cloud implementations shouldn’t work so well for smaller businesses. But here are seven SMB-centric reasons why it can:
Reason#1: Cloud is OpEx, Not CapEx
The cloud model of data-center-driven, service-centric provisioning offers customers the chance to purchase only the computing power they need. The shift goes from upfront capital expenditure (CapEx), to controlled operational expenditure (OpEx). It’s a concept born in big business, but it’s an ideal scenario for the smaller business, too. In fact, you could argue that extra money available for reinvestment can have a far more profound effect on the success of a small business in growth mode than a large one.
Reason #2: The Cloud Empowers Resource-Constrained Businesses
SMB Group co-founder and specialist small business market analyst Laurie McCabe and SMB Group co-founder Sanjeev Aggarwal set down the state of the SMB cloud nation in their firm’s SMB Group’s 2018 Top 10 SMB Technology Trends report.
According to the SMB Group report, “Cloud providers can aggregate massive quantities of data in one place and apply rules, algorithms, learning, and other technologies to this data. As a result, they offer resource-constrained SMBs the economies of skill and scale and the skill required to use technology to meet new market demands, improve business results and reshape their businesses to keep pace with a changing competitive landscape.”
Where smaller businesses rarely have the budgets to hire business analysts, data scientists, and engineers capable of creating machine learning algorithms, they can hop on the coattails of those types of services offered by their cloud technology providers.
Reason #3: SAP Leonardo Is the SMB Wingman
SMBs can use the open APIs and industry innovation accelerators within SAP Leonardo to boost their tech stack’s ability to do more. SAP Leonardo’s design-thinking-inspired technologies are designed to help provide intelligent recommendations (rather like a wingman or copilot) and to automate rote tasks that can be more productively shifted to control by the cloud. That frees up critical labor at small businesses to do the most important work, whatever that may be in your industry.
SAP Leonardo’s pre-integrated capabilities, tools, and materials for specific business functions apply just as much to SMBs as they do to large-scale enterprises. The same custom tailoring can also fit the use case, just at a smaller scale. So, don’t think that your business can’t benefit from the emerging technologies associated with SAP Leonardo (blockchain, machine learning, analytics, big data, and the Internet of Things) just because you’re on the smaller end of the scale.
Reason #4: SAP Connects SMBs With Cloud Experts
SAP global head of channels Karl Fahrbach has said that SAP’s Channel 2020 strategy is now becoming a reality. Since 2015, the company has been looking at potential growth areas and the focus has now turned to the mid-market and how SAP can help transition this space to the cloud. The strategy is modular and will see SAP will work with existing partners (who manage successful on-premises work) to help them leverage the move into the cloud for the mid-market customer.
What this means for you, as a small-business owner, is that you can work with a variety of SAP-sanctioned partners to help you accelerate your move to the cloud. Many of these are what SAP refers to as “born in the cloud players,” with cloud expertise that’s often localized for different markets and adapted for specific industries. “We have more than 600 partners with pure cloud DNA now in our SAP-Qualified Partner-Packaged Solution, which is more than 14 percent more than we had last year,” explained Fahrbach.
Reason #6: SAP Has Two Offerings Specifically for SMBs
Business ByDesign is a cloud-first solutions package that has been called ERP in a box by some. As a suite of software in its own right, it offers human resources tools, financial planning and management software, sales and procurement functionality, customer relationship management (CRM), and supply chain management. It also integrates with Microsoft Office.
SAP Business One is a smaller-scale on-premise ERP system, although a cloud version now exists. Many of the same functions exist in SAP Business One as those found in Business ByDesign including CRM, financials, sales, and inventory. As well as integrating with Microsoft Office, SAP Business One also integrates with a number of third-party modules and enhancements.
Could some consolidation be on the horizon for these two? SAP has worked to bring together SAP Business One (for those with 250 employees or fewer) and the cloud-first Business ByDesign package (for enterprises with 350-1500 employees) under one single marketing umbrella.
The bottom line? You can choose which of these two solutions best fit your business. Those who are interested in learning more from other SAP Business One customers can get involved with ASUG’s ONE.Source community.
Reason #7: SAP Understands the Possibilities Within the SMB World
SAP’s small- and medium-sized business strategy ultimately exists to help roll out the complete SAP product set to a broader range of business types. Bobby Vetter, SAP head of packaging solutions, has said that the team that wants to win and attract customers to scale will help the SMB market learn how to scale in the cloud. Could we then expect to see SAP Concur, SAP SuccessFactors, SAP Hybris, or other cloud products offered in SMB flavors in the days to come? SAP SuccessFactors, for one, already has such an offering.
Perhaps we’ll learn more about what SAP has on the horizon for small- and medium-sized businesses, at its next SMB Innovation Summit, held in the spring in Vietnam, Barcelona, and Orlando.
Connect with other SAP customers at small- and medium-sized businesses at our Biz.One Conference in October in Orlando. Find out what’s on the agenda this year.