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Variety may be the spice of life, but innovation drives variety. The pervasive taste of Apple would still dominate the smartphone palate if Samsung hadn’t kicked things up a notch.

Innovation Snabe 01-10-2013-AIn fact, the South Korean manufacturer of the iPhone-rivaling Galaxy S III enjoyed its fifth consecutive record-breaking quarter for operating profit in Q4, Financial Times reported Tuesday. Samsung also owes a lot of that success to not-so-high-end devices.

Though Apple hasn’t catered to that segment of the mobile phone market, The Wall Street Journal reported Wednesday that a lower-price iPhone could hit the shelves by the end of this year.

Samsung’s success is a painful reminder to Apple that innovation is key to market success. SAP Co-CEO Jim Hagemann Snabe recently discussed the implications of a customer-driven, innovation-oriented company with German international broadcaster Deutsche Welle.

Innovation Snabe 01-10-2013-B“It means listen more to the customer,” Snabe said. “It means rethinking how we innovate.”

Shortening cycles of innovation and thinking like a startup company are components of this ambitious shift in focus, which Snabe considers SAP’s major change so far during his tenure as co-CEO. That requires agility and grand ideas.

“HANA is one of the very big breakthroughs that we had with this innovation strategy,” Snabe said. “It basically challenges one big assumption that we’ve had since the start of IT: that data is stored on a disk.”

The disk isn’t keeping pace with the rest of the computer’s evolution into something ever faster. So SAP engineers discovered how to store data in main memory, which is 10,000 times faster than a disk. Combine that with a data compression algorithm, and a large organization can store all of its information in main memory.

“Because of that, we can start predicting the future through mathematical models ...  instead of just reporting the past,” Snabe said, noting that HANA can help companies forecast consumer preference patterns. “We even helped predict the election in the U.S. based on Twitter sentiment analysis, again an example of large volumes of data analyzed very fast.”

SAP will announce Thursday other innovative ways to help customers cut efforts and costs with Business Suite on HANA.

Related Articles:

Galaxy Lifts Samsung Profit to Record” by Simon Mundy

A Low-Priced iPhone Awaits” by Jessica E. Lessin

What will the software of the future look like?” by Deutsche Welle