May 20, 2009, 9:31 AM — SAP is already a major player in the cloud computing world because its customers are using their ERP (enterprise resource planning) implementations to create "cloud economies" that expose system data to customers and partners, chief technology officer Vishal Sikka said Tuesday during a keynote address at the Interop conference in Las Vegas.
They are doing so on a massive scale, according to Sikka, whose speech was webcast. For example, one large SAP customer runs the ERP system for its entire Asia-Pacific region on a Hewlett-Packard cloud, he said.
Some of these systems are running on a massive scale, Sikka said. For example, a large German bank and SAP customer that has a variety of Web services for customers sometimes runs eight million transactions per hour, he said. That is more transactions than on-demand CRM (customer relationship management) vendor Salesforce.com does. Salesforce has said its system pushes more than 150 million transactions per day.
SAP software runs on cloud environments in many companies already, Sikka said. "SAP provides the infrastructure already ... to make these cloud economies, these cloud services, happen," he said.
In addition, "thousands" of SAP customers are using cloud infrastructure platforms such as Amazon Web Services for development and testing purposes, according to Sikka.
Meanwhile, SAP's own cloud development strategy is being waged on two fronts. For large enterprises, it plans to deliver a series of focused on-demand applications that complement its on-premises Business Suite software, and to work to ensure tight integration between the two types of software.
SAP's recent move to acquire intellectual property and personnel from application development vendor Coghead was part of this goal, he said.
Integration hasn't always been a strong point for on-demand applications, Sikka said. Various on-demand "edge applications" for talent management and CRM (customer relationship management) have added value for customers, but become "islands" for IT departments to stitch together, according to Sikka.
Sikka also touched upon one of the most highly anticipated components of SAP's cloud strategy, its Business ByDesign on-demand ERP suite for the midmarket. SAP has scaled back the rollout of the application until it can figure out how to turn enough of a profit at scale.
This is no trivial matter, Vishal said, given the complexity and ambition of the software, which encompasses ERP, CRM, supply chain management and several other areas.
"It is one thing to do one thing, like sales force automation, and run that on an Oracle database and call yourself a platform," he said. It's another matter to execute a complex inventory-checking process in a cloud model, according to Sikka.