SAP lays out cloud strategy post-SuccessFactors deal

IDG News Service - SAP announced a broad set of plans to become a player in cloud computing, spanning from a "loosely coupled suite" of business applications to data integration and PaaS (platform as a service) Tuesday during the Sapphire conference in Orlando.

The conference comes several months after SAP's $3.4 billion acquisition of SuccessFactors, a move that gave it a large set of cloud-based HCM (human capital management) software as well as what executives called "cloud DNA," or expertise running such businesses.

While SAP had sold SaaS (software as a service) for some time prior to the deal, it remained a company largely set in the on-premises software world of long sales and releases cycles and perpetual licensing, compared to the subscription pricing and rapid product updates common in the cloud.

SuccessFactors CEO Lars Dalgaard has been tapped to oversee SAP's cloud strategy and is expected to deliver a keynote at Sapphire along with co-CEO Jim Hagemann Snabe, describing more of the combined company's plans moving forward.

Those will include applications organized around the themes of people, money, customers and suppliers, said Sven Denecken, vice president of strategy and co-innovation, cloud solutions, in an interview prior to the show.

Hitting on the first two categories, SAP will announce plans to integrate its global payroll software in the cloud, with SuccessFactors' Employee Central portal.

SAP is also planning to release Financials OnDemand, a product aimed at large enterprises that will also be tied into Employee Central. This announcement could reflect the rise of competitors such as Workday, which has made inroads into large companies with its on-demand human resources software, and is now eager to win big accounts with its financials product as well.

On the "customers" front, SAP's Sales OnDemand CRM (customer relationship management) application will now get quarterly updates, bringing it in line with rivals such as Salesforce.com. In addition, SAP announced the availability of a new application, Social Customer Engagement OnDemand, that helps marketers and service representatives communicate with customers over sites such as Facebook.

On the topic of suppliers, SAP plans to further build out its Sourcing OnDemand and Information Interchange OnDemand applications, which companies can use to acquire supplies and manage invoices, respectively.

Some of the functionality for these applications will essentially be carved off of SAP's Business ByDesign on-demand ERP (enterprise resource planning) suite, which will in turn still be available in its complete form, according to Denecken. "We see a very dedicated market for that."

"Customers can adopt these products at their own pace in their own way," he added. "That's what a loosely coupled suite should enable."