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You may have heard. Last year, SAP cloud business knocked it out of the park. During our recent earnings, SAP reported $3 billion in cloud-based services and subscriptions for 2016.

The SAP Executive Board is speaking about SAP’s 2020 ambitions and strategy with the financial community at Capital Markets Day in New York City last week. As part of that event, SAP announced new functionality for the SAP Cloud, specifically SAP S/4HANA Cloud.

This is the first of four quarterly updates to SAP S/4HANA Cloud planned this year – with the next one due sometime in May. But first, let’s start with what’s new in this version and why it is so important.

Scale and Speed

Most important, SAP S/4HANA Cloud is ready for the upper mid-market and large enterprises. Now organizations with over 1500 employees can use SAP to run their ERP systems in the cloud. Working with customers, deployment time has been reduced to as little as five weeks.

The release comes just in time to take advantage of a ripening market. Industry research firm IDC predicts that the software-as-a-service (SaaS) business applications market will grow 17 percent annually to $103.9B in 2020 from $47.4B in 2015.*


This version of SAP S/4HANA Cloud now has contextual analytics and machine learning built in. Contextual analytics provide employees with real-time information so they can act on it immediately. SAP has also baked machine learning technology into SAP S/4HANA. For example, machine learning techniques enable the software to learn “on the job” and to continuously improve procedures like invoice matching.

In addition, the SAP Design Team also built a digital assistant called “CoPilot,” which allows people to interact with SAP S/4HANA Cloud using chat and eventually voice. For example, chatting with CoPilot can help answer employees’ queries and show them things they might have overlooked.

Beautifully Designed

Fiori is the user interface created for all SAP S/4HANA solutions by our award-winning design team. It is elegant, beautiful and easy to use. With Fiori as its frontend, SAP S/4HANA Cloud is simpler and more user friendly than many rival software products on the market.

New Offerings for Finance and Service Centric Organizations

Throughout the year SAP will roll out functionality for different lines of business and industries. Today’s release offers major advances for finance including integrated financial, procurement and order management functionality.

Service-centric firms like architectural, engineering and professional services can also benefit from new end-to-end project management capabilities.

Special Sauce

As of today, SAP S/4HANA Cloud is smarter, more elegant and user friendly than the competition. And with over 40 years of experience leading the ERP market -- and over 30 line of business cloud applications (as well as cloud ERP for smaller businesses) -- SAP has the expertise required to keep moving forward. Looking ahead, these new advances position SAP S/4HANA Cloud to surpass the competition by the end of 2017.

Darren Roos, president of SAP S/4HANA Cloud, said, “Decades ago, SAP invented and became the leader in first-generation ERP. Later, we were early to build first-generation cloud ERP along with other new cloud vendors. While many cloud ERP vendors remain on this early architecture, SAP did not stop there, and invested in innovating the next generation of cloud ERP. SAP S/4HANA Cloud encompasses the latest architecture and technology innovations, along with SAP’s proven set of business management expertise to usher in a true new generation of intelligent ERP in the cloud.”

* IDC, Worldwide and Regional Public IT Cloud Services Forecast, 2016-2020, Doc # US40739016, Dec. 2016.