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(Editions of this series: On Demand Line of Business (1) What are end users seeking from their Line of Business cloud solution...On Demand Line of Business (2) What do customers already love about cloud solutions? - 3 ) 


Feedback the co-innovation team has received from our customers shows that while on-demand solutions offer some extremely attractive benefits (like cost savings, and significantly shorter implementation times), certain issues cloud its overall appeal.  This blog reviews some of the concerns our customers have shared with us, and our thoughts on the issue.


1. Lack of Customization: 

Customers are concerned about sacrificing custom features when they opt for a more standard system. We get a lot of feedback where customers weigh cost ratios against standardization.  Customers are always going to have to trade off between the benefits of cost and a faster implementation cycle, and the ability to include hundreds of custom configurations.  An on-demand system forces a customer to evaluate and prioritize.  Incorporating endless features may sound appealing on paper, but upon closer analysis, does one really need such a vast array of options? How many of those tailor-made features will actually be used?

Customers are beginning to accept that total flexibility is not always the best solution, and are more willing to accept a degree of standardization.  We have been observing a trend toward standardization in both on demand as well as on premise systems and did respond with a on demand offering as well as pre-packaged solutions with rapid deployment times – even based on a cloud infrastructure. 


2. Infrastructure limitations: 


Companies continue to fear that infrastructure could impose constraints when the system resides on the cloud.  The two big concerns lie in the area of security (Is my data and information secure at every level?) and orchestration (how will my on-demand system work with what I already have in place?).

SAP has mastered security.  Decades of implementing massive systems with the highest possible security features, have given us the expertise and a rock solid track record in creating secure solutions.

Orchestration is another cornerstone of an SAP system.  Our on demand and on premise systems are designed to work together.  A company can sign up for an on demand solution, and it would be easy for them to integrate it with a larger on premise system he has decided on – by himself or our eco-system that supports us here.  The integration with an SAP system is seamless, as the architectural blue prints of both systems have the same origin. Often this advantage is not in the focus of line of business areas, even if the know the need for enterprise data – cloud providers sometimes underplay the effort and the related costs, see also: 

3. Integration: 


The common concern raised here is what unforeseen costs might come up, should the need arise for integration of systems down the road.  Will today’s savings be outweighed by tomorrow’s integration costs?

There is truth to this concern, as there are often high costs with integrating systems after the fact. Line of business and IT departments should sit at the table together, looking at the lifecycle of a combined solution – systems of engagement combined with systems of record.

At SAP, we take integration into account right from the start. Our systems are designed to fit together. We integrate based on our shared architectural blueprint and take that worry away from the end user, bringing IT and line of business closer together. Our ability to integrate systems is one of the big differentiators for us. Watch out for some of the next blogs on what more.   



While on the topic of integration, we frequently get asked about the feasibility of a complete cloud solution.  At SAP, we believe that a hybrid scenario, or co-existence between what has already been invested in by the customer (mostly on-premise), and what can be procured through software as a service over the internet (on-demand), will continue for the foreseeable future.


While a system like Business ByDesign is certainly capable of handling the requirements of even large corporation – take the subsidiary play, fusing the system of engagement with the system of records will offer our customers the best of both worlds. Many customers have come to rely on the unique features and benefits cloud based systems have been able to provide.


Others continue to have qualms about whether the benefits outweigh the costs or risks of adoption.  While trade offs are a fact of life, at the end of the day a customer has to closely evaluate all options because not all on demand systems are created equal.