It’s a truism that a business is only viable if it can retain and potentially grow its customer base. A company that actually listens to what customers are saying, will try to steer product development to meet those requirements and tackle pain-points it hears about.
But one only has to listen to the earning call conversations and it would appear that in tech, the bosses of publicly listed companies, appear to care little about actual customers but have, instead, a laser focus on delivering shareholder value.
Imagine being able to listen-in on boardroom conversations. One would expect the inevitable discussion on managing the current economic crisis and how this is impacting on the cost of materials, logistics and customers’ willingness to buy new products. Board members will want a plan to compete with “so-and-so”. Does the company continue to invest in research and development and product innovation? How does the company reduce operational overheads? Job cuts? Which customers are the cash cows and how do we maximise earnings potential from the remainder? If it fails to grow, investors will put their money elsewhere.
But without its customers, the business isn’t viable as outgoing UK and Ireland SAP User Group chair, Paul Cooper, discussed during the user group’s annual Connect23 conference in Birmingham.
Rise, the version of SAP’s ERP system that runs in SAP’s cloud, was among the main talking points in the opening presentation. During its Q2 2023 earnings filing, SAP’s chief, Christian Klein, ruled out the ability for customers to have the latest product innovations unless they choose SAP Rise, its public cloud ERP offering.
In a conversation with Computer Weekly, Conor Riordan, vice chair, UKISUG, pointed out that historically SAP gave its customers predictability, based on a public roadmap. He said: “Now with the new strategy, in terms of innovation, you don’t have predictability anymore.” This means IT buyers who are not on Rise, may not want to make an investment decision that locks them into SAP, especially if they are paying on-going maintenance while getting less new features.
If they are being excluded from receiving these value-added features then there is a very real risk SAP customers will go elsewhere. There’s likely to be an entire ecosystem of software providers lining up to add the missing functionality that SAP has refused to provide to its on-prem and hosted S/4Hana customers. And IT buyers are unlikely to see the benefit of paying on-going software maintenance to SAP, unless they see new innovation funded by their not inconsiderable annual fees.
SAP’s new UK head wants to rebuild trust. But this is being balanced with shareholder value. One can only hope that this time, SAP puts the customer first.