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AI and IoT at SAP – Yin and Yang

Thomas Wieberneit | May 20, 2017 468 views No Comments

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During the 2017 SAPPHIRE NOW conference SAP told the stunned audience about how they connected some dots to create better value and more intelligent business applications for their customers.

In essence SAP lifted the veil on how the company will go ahead with two technologies that will dominate the next years and that are ordinarily treated as different topics.

But which, in essence, are like yin and yang.

I talk about AI and machine learning on one hand, and IoT on the other.

SAP has been fairly quiet on the former and fairly vocal on the latter, although the first announcement was about machine learning powered intelligent business applications, back in November 2016. At that time SAP announced the availability of the machine learning platform for SAPPHIRE NOW 2017.



After this, SAP announced SAP Leonardo, the bundling of their IoT portfolio back in January 2017.

On day 1 of SAPPHIRE NOW SAP delivered on the November promise by announcing “it’s time for machine learning to take the work out of your work flow. It’s time for billions of devices to go from thinking, to doing. It’s time for SAP Leonardo, the SAP system for digital innovation.’

With this approach they even go beyond only connecting two technologies but they also add Blockchain, Big Data, Data Intelligence and Analytics into one single platform. Whereas one could argue that Big Data, Data Intelligence and Analytics are essentially the same.

With this powerful combination, as Holger Mueller, Principal Analyst of Constellation Research, aptly observed, ‘technology for the first time can do more than business best practices want’.

To accommodate for this, SAP added consulting elements into the new Leonardo brand.

This makes SAP Leonardo more of a toolkit than an actual solution, but a toolkit that SAP proved to help solving specific business problems in short times.

In the words of Mala Anand, president for SAP Leonardo: “SAP Leonardo is our brand variety but to deliver transformation at scale we need more than IT so we’ve expanded SAP Leonardo to be our digital innovation system that will help you, confidently, redefine your business for this digital world.”

My Take

A brilliant move.

As I already indicated, AI and IoT are like Yin and Yang. They are facets of the same thing. While current ‘things’ are mainly sensors they are creating a tremendous amount of data that needs to be analysed for the patterns that allow for intelligent action and reaction. This massive amount of data also explains why SAP moved Big Data, Data Intelligence and Analytics into SAP Leonardo.

In not so far future these ‘things’ will not only be sensors but also be actuators, means take action – self-driving cars are only the most discussed theme here. There will be many more. This is where the ‘things’ start the doing. And many of these ‘things’ will be inside the boundary of companies, SAP’s core domain.

Although SAP also moves into consumer technologies, e.g. automated cars.

Finally, SAP added Blockchain into the mix. This really rounds off the tool kit, as it is a security technology that is geared for establishing trust – first between systems and then by making the systems trustworthy to humans. More mature security technology is delivered via the SAP Cloud Platform that is the foundation of SAP Leonardo.

With this set of technologies plus a methodology around them that helps in solving problems fast, SAP has something at hand that can hardly be overestimated.

At this time I do not see the other big business application vendors having something of similar capability at hand, not Oracle, not Salesforce, even not Microsoft, which is probably closest to be there.

Now, after these glowing words there of course are some buts.

The first one is that there now can be some confusion about what SAP Leonardo stands for. Originally it was about ‘connecting intelligent devices with people and processes to achieve tangible business outcomes’. Now it is far more, and not only a technology anymore. While this shift is in my eyes straightforward, I would expect that it still needs some education.

The second, and more important one, being that there are countless other IoT platforms out there in the market. There hasn’t been much of standardization yet and interoperability between those platforms is also still in its infancy. And SAP still has the reputation of being hard to work with, which is a clear inhibitor on the way to becoming the leading dog in this market. Similarly for the Blockchain technology. There are quite some groups of companies trying to get into a dominant position, with inter-group interoperation being very limited.

On the other hand there are only few companies that can move with a similar thrust. One of them being Google, who just announced during the Google I/O conference that they will weave AI and machine learning into their products, around 2 billion of which happen to be the ‘things’ called smartphones. And Google has quite some interesting consumer use cases.

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