John Schwarz on SAP BusinessObjects Plans and Priorities

John Schwarz, ex-CEO of Business Objects (and now an Executive Board Member of SAP responsible for SAP BusinessObjects, the Global Ecosystem & Partner Group, and Corporate Development) had several conversations with bloggers at the Fortune Brainstorm event in July. Coverage included:

Jeff Nolan: SAP’s John Schwarz on Analytics:

“If you have been following SAP’s financial results this year you already know that Business Objects is fueling SAP’s growth as their core ERP business has been hit by the global economic recession and stalled…

Fast forward to today and analytics is looking to be a really attractive market for SAP because of the strength of the Business Objects offerings and good integration with SAP’s application products…

To conclude, I really enjoyed meeting Schwarz and it’s clear that he has a good line of sight on where his business unit needs to be focusing not just for revenue growth but also to protect the flanks as the market continues to evolve. While there is much to like, there is also much to be concerned about but on balance the concerns are more tactical than strategic so I’m willing to give him the benefit of doubt at this point.”

Oliver Marks: SAP’s Schwarz & Sikka: The Road to More Agile Business Performance

“SAP are very well positioned with Business Objects, now digested and integrated after being consumed in 2007, leading the infrastructure needs line of business wants installed and data extracted from for analysis. Traditionally IT have checked the requirement boxes and supplied infrastructure, often with unhappy results from the actual users.”

Vinnie Mirchandani: SAP’s Analytical Ambitions

“John was extremely articulate – as Jeff says he is the “man with the plan”. Hopefully a plan that does not require companies to keep going through their annual planning ritual – 11 months of the year”

Dennis Howlett: SAP unplugged: Vishal Sikka and John Schwarz on deck

“John Schwarz was in relaxed mood, talking to the different dimensions across which SAP’s vision of business analytics is traversing. I was curious to know how the company hoped to wean the Excel junkies off their addiction to Pivot Tables. I was a little disappointed to hear John tread familiar territory, arguing that it is better to live with spreadsheets than try fight them.”

Dennis Howlett also did an interview with John — here’s a rough transcript

What are we doing now?

If you want to take a look at the evolution of Business Intelligence or Business Analytics from five years ago, from primarily reporting, to query, to now guided navigation, it also allowed us to move away from the domain of IT experts or PhDs that had to do the analytics, to the analytic application being available for almost everyone in the organization. And our intent, in fact, is to make it available to fully everyone in the organization by adopting techniques that we know users like and have learned to live with.

For instance: most users are spreadsheet users today in one capacity or another. What we’ve done is we’ve built analytics that sit on top of a spreadsheet and in effect allow the user to toggle back and forth between tabular format of information and graphical format of information. By doing that, we’re opening the aperture for business intelligence to literally everyone in the organization.

The other dimension that we are moving down the path on is to try to add more data to the user so that it’s not just only structured information that sits in a well-organized database or a spreadsheet, but also information that may be in the web, or information that may be in an email document, or other text that exists around the organization.

And so as we expand along the dimension of getting the information out to more users and getting access to more information, we think that we are, in a sense, embracing the entire organization and embracing the new way that people want to work with information.

Managing the customer base

If you look at Business Objects as it was before SAP, Business Objects had about 45,000 customers, and SAP had roughly the same number. Only about 5,000 of these customers overlapped with each other. And so we now have an interesting challenge and an opportunity.

First of all, cross-selling into the SAP customer base is clearly a phenomenal opportunity, and we are pursuing that with vigor, as you might imagine.

Secondly, maintaining the existing base of 40,000 customers who weren’t SAP customers, who were say Oracle or Microsoft customers is also very important to us and we are focusing very hard on making sure that customers that we remain open, that we remain heterogeneous, we remain an open platform, and that we remain able to deal with information whether it sits on any database or any file structure in the marketplace.

And then there is the opportunity to bring the SAP content to the non-SAP customer as a bonus in the relationship.

And we are doing work on all three fronts and we are working on our technology in our labs to make the migration or continuing existence of customers in their preferred environment as easy as possible.

We’re also working hard on figuring out how the SAP support capability and the experience the customers have had with SAP can be transformed into the same kind of experience for the Business Objects customers. This is a very important investment, a very important part of our focus.

Structured and unstructured data.

So, let’s define structured and unstructured information for the purpose of this discussion. Structured data is data which is organized in databases or files of some structure. It typically is numerical data, or at least it is coded in a way that is relatively easy to consume by a machine.

Unstructured data is typically text or media in content. It happens to be in files that are not particularly well structured HTML or XML or documents. And it is data which is not necessarily managed by a well-documented application – especially email.

So as we try to bring these two worlds together, what we need to do is first of all take the unstructured data and organize it in ways that makes it easy for an application to use. So it has to be tagged, so it has to be coded in some way, it has to be analyzed and it has to be annotated in ways that makes it easy for analysis to take place.

And then what we have to do is figure out what does the user actually see and do with that annotated information, with that index, with that metadata structure that is now available, so that they can then consume that unstructured information in a productive and useful way?

The technology to do all the things I’ve just described exists. What we now need to figure out is “what are the use cases?”. What are the real, repeatable ways that we can bring this technology and make it effective for the customers to adopt?

So we are relatively comfortable with call-center applications, where we give unstructured information about the customer to the call-center operator. And we’re relatively comfortable with applications where legal discovery needs to take place or medical discovery needs to take place and we’re consuming a vast number of documents to arrive at pointing at the few that are key documents to give us the specific value proposition. But we’d like to make it more generic. We’d love to make unstructured data part of every data analysis, and those use cases are still in front of us.

Web analytics

I would say my answer to the adoptability of web analytics or traffic analytics is really dependent on the industry in which the customer resides.

So when you’re talking to customers who are in the consumer packaged goods, for example, they are vitally interested in understanding what’s happening in retail channels. They don’t own retail channels typically, they rely on distribution channels to get the product into the hands of the consumer. But getting that feedback, getting that feedback rapidly and consistently and from a broad a representation of retail points is very very important.

Customers already do that today with let’s say Neilsen data, or IRI data. But these analyses are not real time, and they are only available in massively undifferentiated databases. We’ve got to bring tools to the customer that allow them to take their product marketing strategies and the retail response to those marketing strategies and make those available real time so that the analysis can be done instantly and that the customer can iterate and do some predictive work on the information that they have. We already have applications that are in the marketplace that do that and we need to see more of them.

Other industries which are more predictable in the way that they operate, say manufacturing, or process, or even the energy industries –the web-based applications or web-based analytics are still somewhat more removed.

Top three priorities

I’d say the top three strategies or top three priorities for the group that I’m responsible for at SAP, which is primarily analytics / optimization applications, have to do with how we help customers to bring closed-loop processing into play.

Customers have implemented and automated their core processes and have done a very good job in making that happen. They’ve created enormous amounts of data that is generated by these automated processes.

We now need to help them to use this information to understand how their processes are executing, to do a better job planning and optimizing the processes based on the understanding they have gained from the analysis that they have done.

And so it’s this new layer of what I would call management processes or soft processes that sit on top of the current automation and that can help customers to improve their performance, to improve the utilization of their resources, and improve their responsiveness to the markets. That is the top-of-mind priority above all.

In addition to that, as a follow-on to the integration of Business Objects into SAP, we’re still working to ensure that the customer experience for the Business Objects customers and the SAP customer become very constant and very high-quality and making sure how we go to market with SAP, to both the SAP customers and non traditional SAP customers is as effective as it possibly can be.