SAP Financial Results and the hidden side of HCP

Results were good and showed continued progression in Cloud revenues although margins thinned out a bit. ( See Forbes Article ) Acquired cloud solutions especially Concur and Ariba have been progressing best although EC SuccessFactors ( 1000 Clients ) and SAP HANA ( 2700 Clients ) have held there own. Cloud revenues are due to surpass on-premise revenues in 2017.

So now what next ?

It is clear that CEO Bill McDermott has successfully oriented SAP into the Cloud through diplomatic leadership and his conviction talents but also with an acquisition strategy meant at purchasing innovation rather then attempting to build it in house whilst, at the same time, resting it on sound foundation such as core SAP ERP. It is probable that he will continue making more acquisition fitting the strategic focus of SAP which will remain SMAC for some time but is moving steadily in the direction of Industry 4.0 and possibly Robotics.

So what are the operational consequences ?

The multiple cloud solutions acquired to date and yet to be, will need to be unified under a consistent “User Experience” which SAP Fiori UI will strive to achieve. We also expect, due to past, present and future acquisitions, that the HANA Cloud Platform (HCP) will become increasingly the central application and data integration hub for all SAP solutions ( Cloud and on-Premise ) as well as for 3rd parties and thus hold a strategic role in SAP M&As. This is in fact the hidden side of the HCP.