SAP Looks to Move Beyond CRM in the Cloud

While customer relationship management (CRM) applications lead the way in terms of establishing software-as-a-service (SaaS) as the first major class of service in the cloud, for all intents and purposes CRM software is generally used to create a database of customers that makes it simpler to manage sales teams. While there’s no doubt that CRM software represents a billion dollar software category, SAP this week started making a case for moving beyond it.

With the launch of SAP hybris-as-a-service on the SAP HANA Cloud Platform, Carsten Thoma, president of the customer engagement and commerce business unit at SAP, said the time has come to transform the way the front office inside most organizations operates. In fact, Thoma said CRM as a concept is dying. In its place will rise an integrated set of applications that as a category SAP refers to now as customer experience and commerce (CEC).

Whether that name sticks as a category remains to be seen. SAP is contending that the time has come rethink how the front office operates altogether. As SAP sees it, the rise of digital enterprise requires organizations to tightly integrate their sales, marketing and service functions. The hybris software that SAP acquired in 2013 provides an omni-channel foundation for managing customer interactions that occur both physically and online. There’s no reason, for example, that sales and service people should not be immediately aware of all the touchpoints the organization as a whole has had with any given customer, said Thoma.

While that sounds ideal from a customer engagement perspective, the number of companies that have the processes in place to support it are relatively few. Inside most organizations today sales, service and marketing are separate fiefdoms. SAP is making the case for eliminating the data silos that those separate groups create using the SAP in-memory computing platform running as a cloud service. But in order to do that there needs to be a conscious effort to focus on customer experience in a way that reorganizes an organization under the auspices of, for example, a chief customer officer that has a mandate from the CEO to change the way a company fundamentally operates.

Arguably, it’s hard to make the case for doing that unless the solution providers helping SAP make that case are themselves making that journey. For that reason, Brad Weatherly, a principal with Ernst & Young, says the global systems integrator has transformed the way its 60,000 customer facing representatives engage customers in a way that brings the right people with the right skill sets together in a time manner. To make that occur, Ernst & Young is using SAP hybris to turn marketing loose in a way that drives more opportunities for the solution provider, said Weatherly.

Of course, this isn’t the first time that SAP has moved to reinvent the way businesses operate to drive adoption of a new software category. Before the emergence of suites of ERP there used to be any number of best-of-breed applications that specifically addressed finance and the supply chain. While a handful of best-of-breed applications still exist in those categories, over a span of a decade SAP drove the adoption of ERP. How long it will take to drive CEC as a category is anybody’s guess. But it’s pretty clear at this point that SAP is gearing up to force that issue at the highest levels of the organization.