SAP co-chief executive Jim Hagemann-Snabe's recent comments about the company's low expectations for profit from the UK cloud industry have been misconstrued and are "not true" of the firm's actual goals, VP of cloud strategy Sven Denecken has told Computing.
Denecken said that Hagemann-Snabe's comments, made at the Morgan Stanley investor conference in Barcelona last Friday, had been "picked up maybe a bit weird. I don't know," before adding that he, Denecken, was not present at the conference.
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Speaking to Computing at the SAP UK and Ireland user group conference in Birmingham today, Denecken said it is more important to focus on SAP's current successes than focus on the question of "what is our goal in 2015", which is what he said Hagemann-Snabe was alluding to in Barcelona.
"We are margin positive in the cloud," said Denecken.
"In every earnings you see our segment profit in the cloud is already there. It's not the same as on-premise, it's a different model, but we are one of the only cloud vendors who segment profitability in cloud."
Denecken said that any misunderstanding of SAP's ambitions and offerings has been a messaging problem, the truth apparently muddied by other industry players.
"Our strategy was hard to explain right at the beginning when you had all this hype around pure cloud, [when ours is] hybrid, or integration, and it sounded defensive," said Denecken.
"But in discussions with our partners, they understand they can use the cloud where it fits, augment what they have, and transform certain areas. But in the end it's got to work together, because the process is: start on-premise, go to cloud, go back, and we are not in a rip-and-replace business."
Denecken called this the "differentiation" between SAP and companies offering "pure cloud" services.
"They say, ‘Don't do it this way, just do it this way', and I think that's a fundamental flaw, because you should not plan, as a company, on the vendor pace and the vendor strategy, you should plan on your own strategy."
Denecken said that even as recently as 2011's user group conference, SAP's "openness" on its cloud strategy was sometimes seen as "defensive" among its customers, who had been saying, "What is SAP's cloud strategy? We don't get it."
Since then, Denecken told Computing, it has taken SAP a year of "constantly discussing" its cloud strategy to make users understand.
"And now we have 33 million users in the public cloud - that's more than anybody else," he stated.
"Our clear goal is to make margin in the cloud - we're already doing that - and that is the differentiation between [us and] other vendors who are more into 'land grab', just for the sake of getting customers, but we are here for the long run," Denecken concluded.
