SAP Strengths, Domain Expertise, and Key Differentiators
SAP's dominance in enterprise applications software, ERP, and various management applications underscores its position as an industry leader. With packaged solutions tailored for 26 industries and 12 lines of business, including cloud, on-premise, and hybrid offerings, SAP empowers organizations to thrive in diverse environments. SAP's S/4HANA Cloud, RISE with SAP, and GROW with SAP initiatives facilitate seamless cloud transformation and business innovation, while its Digital Supply Chain solutions enhance productivity and sustainability. Additionally, SAP's comprehensive portfolio extends to intelligent CX solutions, industry-specific cloud offerings, and advanced services and support, all designed to drive digital transformation and accelerate success. Furthermore, SAP Business Technology Platform (SAP BTP) provides a unified technology platform with cloud-native services, enabling intuitive development, seamless integration, and advanced analytics, empowering businesses with the tools they need to succeed in the digital age. With thousands of cloud customers and partners leveraging SAP BTP, SAP continues to lead the way in enabling organizations to harness the power of technology for growth and innovation.
SAP Recent Developments
In December 2023, SAP unveiled the Cloud ERP Suite, consolidating a collection of strategic cloud solutions. This suite includes SAP S/4HANA Cloud within Cloud ERP, SAP Business Technology Platform (BTP), essential solutions for HR and payroll, spend management, commerce, customer data management, business process transformation, and working capital management. Anchored by SAP S/4HANA Cloud and SAP BTP, this suite emphasizes diversified commercial models, prioritizing bundled suite agreements and adaptable consumption plans like RISE Premium Plus. Moreover, SAP is committed to promoting the utilization of multicloud solutions across these offerings.
In November 2023, SAP unveiled the AI Foundation on SAP Business Technology Platform (BTP), featuring a suite of cutting-edge technologies. Additionally, SAP introduced new vector capabilities on SAP HANA, enabling enhanced utilization of artificial intelligence. Furthermore, SAP launched SAP Build Code, a set of AI-powered tools designed to enhance the productivity of professional coders.
In September 2023, SAP introduced Joule, its generative AI co-pilot, to the public. Integrated across SAP's cloud portfolio, Joule extracts insights from various SAP solutions and beyond, facilitating users and companies in swiftly attaining relevant, trustworthy outcomes in a prompt and ethical manner. Through strategic partnerships and collaborations with prominent AI firms such as Nvidia, Microsoft, OpenAI, and Google, SAP aims to broaden the functionalities of its business AI solutions and optimize their value proposition for customers.
SAP Mergers and acquisitions (M&A) Activities
In November 2023, SAP completed its acquisition of LeanIX, a leading figure in enterprise architecture management (EAM), renowned for its support in visualizing, assessing, and guiding the progression towards desired IT architectures. LeanIX solutions empower customers to enhance their IT landscapes, seamlessly complementing SAP Signavio's offerings to drive ongoing business evolution. This strategic acquisition positions SAP to capitalize on the burgeoning market for cloud cost management, particularly among small and medium-sized enterprises where the adoption of IT Asset Management applications is relatively low. This expanded presence among SMBs presents a promising opportunity for sustained growth and increased market penetration for SAP. The acquisition is anticipated to further bolster SAP’s business transformation portfolio, providing customers with access to a comprehensive suite of tools essential for continuous business evolution and enabling AI-driven process optimization.
In March 2022, SAP has completed the acquisition of Taulia, a provider of working capital management solutions. The acquisition further expands SAP’s business network and strengthens SAP’s solutions for the CFO office. Taulia’s solutions will both be tightly integrated into SAP software as well as continue to be available standalone. Taulia will operate as an independent company with its own brand within the SAP Group.
In March 2021, SAP acquired Signavio for enterprise business process intelligence and process management. The acquisition of Signavio complements SAP’s business process intelligence offerings and will help create new offerings by combining Signavio products and SAP products, but is also expected to result, for example, in increased SAP S/4HANA and RISE with SAP sales That followed the purchase of AppGyver for no-code development platform in February 2021. In 2020 SAP bought Emarsys for omnichannel customer engagement platform to complement its Customer Experience offerings. In July 2020, SAP announces spin off of Qualtrics and later In January 2021, Qualtrics went public after SAP spun it off by retaining majority ownership.
SAP Customers in ARTW Customer Database
Leveraging a rigorous data-centric research methodology, APPS RUN THE WORLD asks the simple question: Who’s buying SAP applications and why? And we provide the answers – supported by decades of research – to our clients around the world. Our Customer database has over 100 data fields that detail company usage of SAP and other enterprise apps by function, customer size, industry, location, implementation status, partner involvement, Line of Business Key Stakeholders and IT decision makers contact details. List of Verified SAP S/4 HANA, SAP S/4 HANA Cloud, SAP ERP ECC 6.0, SAP Business ByDesign (ERP for Midsize Business), SAP Business One Cloud (ERP for Small Business), Ariba Network: Sourcing, Procurement, & Finance, Concur Expense, Concur Invoice, Concur Travel, Fieldglass: Flexible Labor Management, SAP BusinessObjects Cloud for Analytics, SAP Hybris Cloud for Customer, SAP Hybris Cloud for Sales, SAP Hybris Cloud for Service, SAP Hybris Commerce, SAP Hybris Marketing, SAP Qualtrics, SAP Jam Collaboration, SAP Jam Communities, SAP SuccessFactors Employee Central, SuccessFactors Performance Management, SuccessFactors Recruiting customers.
SAP Overview
Ownership: - NYSE:SAP
Number of Employees: 107602
Functional Market: Absence and Leave Management, Workforce Analytics, Scheduling, Task Management, Time and Attendance, Core HR, Payroll, Benefits Administration, Pension Administration, Compliance, Contingent Workforce, Onboarding, Recruiting, Candidate Relationship Management, Applicant Tracking Systems, Performance Management, Learning and Development, Succession Planning, Compensation,
Key Verticals: Aerospace and Defense, Automotive, Banking and Financial Services, Communications, Construction, Real Estate, Consumer Packaged Goods, Distribution, K12, Higher Education, Federal Government, State and Local Government, Public Safety, Healthcare, Life Insurance, P&C Insurance, Specialty Insurance, Leisure and Recreation, Hospitality, Life Sciences, Manufacturing, Media, Faith-Based Nonprofit, Youth and Elderly Care, Special Cause Nonprofit, Oil and Gas, Chemicals, Professional Services, Retail, Transportation, Utilities,
SAP Key Cloud and HCM Applications
SAP S/4 HANA, SAP S/4 HANA Cloud, SAP ERP ECC 6.0, SAP Business ByDesign (ERP for Midsize Business), SAP Business One Cloud (ERP for Small Business), Ariba Network: Sourcing, Procurement, & Finance, Concur Expense, Concur Invoice, Concur Travel, Fieldglass: Flexible Labor Management, SAP BusinessObjects Cloud for Analytics, SAP Hybris Cloud for Customer, SAP Hybris Cloud for Sales, SAP Hybris Cloud for Service, SAP Hybris Commerce, SAP Hybris Marketing, SAP Qualtrics, SAP Jam Collaboration, SAP Jam Communities, SAP SuccessFactors Employee Central, SuccessFactors Performance Management, SuccessFactors Recruiting
SAP HCM and Cloud HCM Applications Revenues, $M:
| Type/Year | 2022 | 2023 | YoY Growth, % |
|---|---|---|---|
| Total Revenues, $M | Subscribe | Subscribe | Subscribe |
| HCM Applications Revenues, $M | Subscribe | Subscribe | Subscribe |
* HCM Applications Revenues = License + Support & Maintenance + SaaS ( Hardware and Prof. Services are Excluded )
** All revenue figures are estimates based on public records, Cloud and Non-Cloud business models in Apps Run The World's vendor database, and annual survey results including vendor feedback.
SAP Revenue Breakdown by Type:
SAP HCM Applications Revenues By Sub-Functional Markets, $M:
Split by Sub-Functional Markets | % of HCM Revenue in the HR Segment | 2023 HCM Revenues, By HR Segment, $M | |
SAP HCM Applications Revenues By Verticals, $M:
SAP Total and HCM Applications Revenues by Region:
| Region | % of Total Revenues | 2023 Total Revenues, $M | 2023 HCM Applications Revenues, $M |
|---|---|---|---|
| Americas | Subscribe | Subscribe | Subscribe |
| EMEA | Subscribe | Subscribe | Subscribe |
| APAC | Subscribe | Subscribe | Subscribe |
| Total | Subscribe | Subscribe | Subscribe |
SAP Direct vs Indirect sales
| Region | Direct Sales | Indirect Sales | Total |
|---|---|---|---|
| Type % | Subscribe | Subscribe | Subscribe |
| Revenues, $M | Subscribe | Subscribe | Subscribe |
SAP Customers - Breakdown by Geo, Size, Vertical and Product
List of Verified SAP Customers
No. of SAP Customers: 450000
No. of SAP HCM Applications Customers: 20000
No. of SAP Cloud HCM Customers: x
No. of SAP Cloud HCM Subscribers: 299 million
The adoption of S/4HANA is thriving, with over 20,000 customers and continued growth, encompassing both existing and new ERP customers joining the SAP community. Furthermore, RISE with SAP facilitates the transition to the cloud journey with S/4HANA Cloud, marking nearly two years since its inception in January 2021. Remarkably, nearly 2,500 customers have already embraced this offering.
In addition to GROW with SAP, the vendor also caters to the SME market with SAP Business One, which has more than 75,000 customers running it either as on-premise or hosted in the cloud, and SAP Business ByDesign, a Cloud ERP suite with about 14,000 customers.
There are now more than 10,000 organizations using SAP SuccessFactors solutions around the globe, including over 6,000 customers using the core HR solution, SAP SuccessFactors Employee Central. SAP still has more than 10,000 on-premise HCM applications customers, many of whom also run SAP Payroll on a global level. Another big bloc of customers lies in SAP Concur with more than 48,000 customers and 93 million users for travel and expense management. SAP reached over 23,000 live Business Technology Platform implementations, the evolving solution that aims to connect all assets of SAP by mitigating expensive integration costs for such capabilities as embedded business intelligence/data warehouse, process orchestration and low-code development with new products like Datasphere, Signavio and SAP Build.
SAP Market Opportunities, M&A and Geo Expansions
The current expectation is that by 2025, SAP will successfully migrate 90% of its existing ERP customer base, encompassing a total of 20,000 accounts and 48,000 systems, to S/4HANA as the core platform for these organizations. Additionally, SAP aims to further expand its market presence by transitioning a significant portion of its 20,000 S/4HANA on-premise and 15,000 to 20,000 ECC customers to the cloud. The company has also experienced a steady influx of new customers adopting S/4HANA cloud through Rise, with hundreds of net new customers joining each year. Furthermore, SAP's recent launch of SAP GROW for the midmarket has bolstered sales of SAP Cloud ERP Suite, with approximately 700 GROW customers signed since March 2023.
The lucrative SMB software opportunity – where 79% of the addressable space is at stake – is also beginning to favor SAP after experiencing exceptional growth by signing nearly 100,000 ERP customers in a huge market segment representing tens of millions of organizations between 10 and 999 employees in 2023 as the vendor faces off against stiff competition from the likes of Infor, Intuit, Microsoft Dynamics, Oracle NetSuite, and Sage.
SAP Risks and Challenges
However, SAP faces the challenge of motivating the majority of its legacy customers to upgrade and migrate by 2027, necessitating a balanced approach of incentives and deterrents. One obstacle is the reluctance of some technology and systems integration partners, who have expressed concerns about the high costs associated with adopting SAP BTP, particularly at a time when only a few companies can afford such ambitious projects simultaneously.
Viewed from any perspective, SAP may no longer resemble its former self, necessitating a collaborative effort between the new SAP and its customers. Yet, achieving widespread acceptance will require more than mere persuasion; it demands a synchronized effort between SAP and its customers. Any indication of disengagement from the extensive SAP ecosystem would prove detrimental and impractical for all parties involved.
Following its decision to end its direct business in Russia and Belarus, SAP expects a €300M sales drop in FY22, while its profit will drop €350M for writedowns due to sales commission payout, bad debt and data center closure.
SAP Ecosystem, Partners, Resellers and SI
Partners have played a pivotal role in SAP's journey since its inception in 1972. Over the years, SAP has placed greater emphasis on its partner ecosystem, particularly as it prioritizes cloud industries and aims to deliver top-notch solutions to enhance customer outcomes. In today's landscape, where enterprises are transitioning to cloud-based ERP systems, undergoing constant business transformations, and embracing cutting-edge technologies like artificial intelligence (AI), SAP's partner ecosystem assumes a crucial role. Comprising over 25,800 delivering around 90 percent of SAP customer implementations. SAP's ecosystem encompasses entities that specialize in building, selling, servicing, and operating SAP solutions and technology.
SAP collaborates with an array of prominent partners, including Accenture, Atos, Bain and Company, BCG, Capgemini, Cognizant, Deloitte, DXC Technology, EY, Fujitsu, HCL, IBM, Alibaba, Amazon Web Services (AWS), Microsoft, Infosys, LTI, McKinsey, Minsait – An Indra Company, NTT Data, PwC, TCS, Tech Mahindra, T-Systems, Wipro and Kearney.
SAP Cloud Platform (PaaS) and Infrastructure (IaaS) Details
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Research Methodology
Data used in research reports are derived from publicly available documents, continuous surveys of applications vendors, customers, resellers, Independent Software Vendors, systems integrators and other verifiable sources.
Vendor shares and market forecast results are based on a combination of existing databases as well as demand side and supply side research conducted throughout the year with validation from vendors, customers, channel partners and documentations such as earnings releases and 10Q and 10K filings, vertical industry studies, regional and country-level statistics from public and private institutions(i.e. colleges, universities, government agencies and trade associations).
For additional information on our methodologies, here's the link:
https://www.appsruntheworld.com/taxonomy
https://www.appsruntheworld.com/FAQ
