I am pretty much the last man standing in the bloggers corner, but today I got to attend the key note by Geoffrey Moore on "Business Network Transformation" was quite interesting. Which I will write more about in the days to come but a point that I would like to touch upon right now is the one he made about the innovation cycle on how it pertains to SAP.

G Moore eluded to it during his talk but lets see if I got it right. I think his talk was as extremely relevant within SAP as it would be for the customers who attended at Sapphire, hope the whole of SAP was paying attention.

A key component of the keynote was the the whole innovation cycle (in the attached picture) 

Quick description of which is that more business have a "CORE" but over a period of time all core becomes context with the competition catching up and through evolution in that whole industry, so its important that a this time companies/organizations move the existing core to context which doesn't mean that its no longer important that it is done right, execution in this phase is still very relevant and necessary. Finally this aspect which has become context will need to be offloaded to do the required savings to fund investments in invention. Now to step 1, Assuming that it is a running business and has a stable core, and that is where the organizational focus is it is still very important that its works on new "Invention", which over a period of time would move into becoming the core and the cycle continues.

As suggested most businesses invent a core, over a period of time, that core moves through the evolution path and becomes context but at this time most companies fall into the trap of a large portion of the companies resources/management bandwidth still being focused on this aspect which has now become context from the overall organizations perspective and most times even vehemently protecting their turf and not forget to give the required attention to the invention that now needs to/has become the core of the business.

As indicate G More specifically indicated that A1S and that approach to software is in the left bottom quadrant now - INVENT and will soon(er than you think) become the core of the SAP business.

He specifically touched upon the fact that the challenges in moving the existing core to the context is phenomenally difficult and is a huge challenge that companies are going to face, a couple of examples provided were - the salesforce think why should I waste my stuff with this weird stuff (A1S) while the existing products are doing great or why should I spend any time on this 50000$ business when there are opportunities for a 3Million$ in the existing business.Sounds and seems very relevant to the SAP scenario don?t you think??

Undoubtedly this initiative is going to be huge change management exercise across the the whole SAP go to market ecosystem, may it be PR, marketing, sales, influencer community, ISV, SI & re-seller partners etc. As they are focused on a different type of business and A1S / OnDemand is a paradigm shift in the way the business is going to be done in the future.But I applaud SAP on taking the bold step.

And also the good thing for SAP is that they might have some time to get their act in place, the A1S product is expected to be released in 2008. But they really need to move fast. On another front I believe with the initiatives like the SDN/BPX and other such community initiatives including the bloggers program that they have put in place they will have the required expertise and the know how on how to engage the community at the bottom of the pyramid.

Though I am highlighting A1S in this post, I think these very points apply to the whole SME/SMB initiative of SAP. Its a brand new day for them.

After a couple of conversations on SME initiative, I have penned down close to 4 sheets of points / questions on the SME initiative, so stay tuned for a lot more posts on this topic.

Tags: sapphire07 - sap - a1s - crm - saas - on+demand - sapphire07+vienna

Prashanth Rai