GROW with SAP Announcement - A Rapid Cloud ERP for Midmarket Organizations

On March 21, 2023, SAP CEO Christian Klein announced a new SAP could ERP offering based on RISE with SAP targeted at Midsize companies.?SAP defines Midsize as organizations with less than $1 Billion in revenue.?

Specific details as to what exactly GROW with SAP is and how does is differentiate from RISE with SAP are still unknown.?But my guess is that GROW with SAP is just a marketing term to brand towards the midmarket, but the underlying technology is the same as RISE with SAP.?Midmarket customers will probably still get the same S/4HANA application suite for their core, run in a cloud environment, and be provided with the Business Technology Platform (BTP) to create their own apps, processes, and integrations via cloud-native, the same as RISE with SAP.?What might be unique about GROW with SAP are probably more narrowed options for how and where to run the SAP environment, possibly how it’s supported, and maybe even how much the midsize company must adopt industry-standard processes.

If you dig a bit further into the GROW with SAP solution on SAP.com, you’ll see the customer success stories are S/4HANA Cloud: Public Edition, which aligns with the theory that in order to provide more rapid adoption, the delivered solution is narrower and more restricted that other SAP options.?More on that in a bit; first, let’s look at some interesting points from the press release.

“Designed specifically to help midsize companies take full advantage of cloud ERP and all the benefits that cloud solutions offer, GROW with SAP gives customers the confidence that they will be up and running quickly with technology that allows them to keep growing effectively and efficiently.”

SAP’s focus with these midmarket companies is providing SAP as a platform for growth.?Not necessarily as SAP has defined it before; i.e., as you grow don’t you want to be running the ERP of all the significant companies your organization aspires to grow to one day??That was the old way of thinking.?The new way of thinking is SAP will grow with your organization.?Growing midsize companies today need agility, flexibility, and scalability, all around a solution that’s capable of handling their organizational needs today and where they may grow tomorrow.?This is a great angle SAP takes as it’s a shift in how customers think of SAP solutions.?It’s a shift to a proper cloud-native solution where you consume what you need today but can quickly consume more as you grow.?Think of Office365.?Today a midsize company uses O365 the same way a Fortune 100 company would, getting the same tools and benefits.?The only difference is the number of people consuming the tool.

"For more than 50 years, SAP has worked hand in hand with customers across every industry to benchmark and define best-in-class industry-specific processes. With GROW with SAP, companies can immediately adopt these pre-configured, industry best practices, while embedded AI and automation capabilities enable customers to see rapid results in time and cost efficiency, not just effectiveness."

Here SAP is playing to its strengths as an industry leader with decades of experience built into its solutions that allow midsize companies to benefit from and run like the big companies immediately.?They (potentially) get the same technology, same processes, and identical tools, only delivered fast in a pre-configured model, where SAP and these big companies spent years developing these tools.?This idea isn’t new; SAP has offered some form of pre-configured or best-practice for over a decade in varying formats such as All-In-One, Industry Solutions, etc.

Here the pitch is full access to a wide variety of processes, technology, and tools from day one that allow that midmarket to reduce implementation/adoption, see faster results once live, and potentially grow into technology the larger companies use at some point in the future.?That scalability angle again.

The inclusion of the Business Technology Platform makes total sense.?There’s a big push for BTP to be where every company now does its customization.?The idea is to keep the core clean and leverage the cloud-native BTP for customization, development, integrations, etc.?This allows customers to empower their business experts to own these apps and processes because the low-code/no-code development platform uses industry standards in a more visual format.?It also benefits SAP’s ability to deliver support to their S/4HANA cloud environment because customers now keep the SAP core cleaner.

"The GROW with SAP offering also features services and tools to streamline delivery at a fixed rate that delivers a technical go-live in as little as four to six weeks and assures customers of the rapid time to value they need"

This is a fascinating statement.?It is an excellent sales play for SAP because one misconception they constantly try to overcome was that SAP is too big, too complex, and takes too long to implement.?The cloud/as-a-service industry is delivered fast and efficiently.?Since SAP wasn’t born and built in the -as-a-service model, they have been working to figure how to be perceived as an as-a-service cloud solution.?SAP seems to have figured out the first part; how customers consume and pay for a solution as-a-service, with RISE with SAP.?The next hurdle is the quick and easy delivery of a solution.

I’ve spent 15+ years in the SAP space, implemented SAP dozens of times across many industries, and was even part of the team that delivered (at the time) the world record fastest SAP net-new customer implementation.?That was two weeks, and it was a minimal scope, only leveraging Finance and Accounting processes.?So, if I can read the tea leaves here a bit, I’ll go out on a limb and say yes, it’s possible to quickly and effectively deliver an SAP solution in a matter of weeks.

But to do that, there will likely be limited scopes and tightly defined options.?For example, possibly using a standardized reference cloud architecture, a multi-tenant environment already up and running, already has the database and application installed, possibly pre-defined and preloaded with configuration and processes, and little flexibility and options to achieve a rapid timeline.?

If you dig a little further into the solution S/4HANA cloud, public edition is the platform used to accomplish this rapid deployment model.

Historically this has not been a viable option for some customers to use because of the specific constraining requirements of sharing infrastructure and even application code base and configuration with other customers (shared or multi-tenant), limited support options, particular pre-defined planned downtime and maintenance windows, and in some cases restrictions of language, country, and region.?

All that isn’t inherently a bad thing.?I can’t tell you how many times people say, “I really wish we didn’t stray so far from standard; now our SAP environment is much harder to maintain.”?It is just important that midsize companies understand the structure they’re engaging in and consider what that structure means for them both now and in the future as they grow.?What flexibility and scalability ae you really receiving??What is vital to midsize companies at this point, flexibility??Rapid delivery??Leveraging tools and processes that allow you to grow and gain a competitive advantage? Or having the freedom to define your own solution now and in the future?

These are all great considerations to balance.?I think GROW with SAP positions itself as an offering poised to address a lot of the needs of mid-sized companies looking for that agility and innovation with flexibility in a platform that will grow with them.?

One additional thought:

GROW with SAP seems targeted at midsize companies not yet running SAP.?However, I wonder how, or even if, GROW with SAP can be leveraged by all those midsized companies already running SAP.?Midsize companies have been one of the most significant market segment growths for SAP over the past decade.?Now that these organizations adopted ECC or S/4HANA, what compelling points does GROW with SAP provide them??This is a really interesting question with the 2027 ECC support deadline on the horizon for all these organizations still on an SAP platform that will be affected. It's the #1 SAP conversation I have almost daily with SAP customers: their SAP journey over the next five years.?

What are your thoughts?