As SAP’s latest user conference draws to a close, what should the software giant’s customers and prospects expect over the coming months?

The event was fairly news-lite, with no big announcements from the supplier that would really shake up the market. But it was clear that there are certain messages that your friendly SAP sales rep will be pushing to IT leaders the next time he or she comes to call.

At a strategic level, the phrases you will hear most frequently this year are collaboration, “business networks” and “strategic agility”. The latter, in particular, strikes me as a classic IT marketing buzzword that means very little in the real world of running an IT department. But overall, SAP is predicting that its customers will need to become more flexible, more open, and more connected with their supply chains from customers to staff to suppliers.

The biggest SAP users – the likes of Nokia, Colgate-Palmolive, Rolls-Royce or Kraft Foods – who presented at the conference exist in a global environment with many outsourced functions and a potential for complexity that would cripple a business that does not adequately support critical processes with technology. They rely on close co-operation with suppliers and fast response to customers. They have all adopted the principle of ruthless standardisation for their IT.

For the many thousands of companies that are not operating on such a huge scale, the concepts of flexibility and collaboration will still be recognisable – if a little scary. Opening up the organisation, becoming connected to external partners, and sharing internal information do not come naturally or easily to many companies – but they will be key characteristics of successful businesses in the internet age.

At a technology level, SAP is going for a big push on its latest customer relationship management (CRM) release, SAP CRM 2007.

Insiders at the supplier privately acknowledge that SAP’s previous CRM offering was maybe not as good is it could have been, but with the new product the firm hopes to better compete with Oracle / Siebel, as well as mid-market alternatives such as Microsoft. There seems to be a big internal push on making 2008 a successful year for CRM 2007 – so expect the sales rep to come knocking soon.

This was my fourth Sapphire, but my first for a few years. Overall, I would say this is one of the better IT vendor conferences – purely because SAP is very good at getting high-profile customers to speak about what they are doing and to share their experiences with their peers. Of course, if you want to delve into products and technologies, there’s every opportunity, but as an occasion to learn from IT leaders at some of the world’s top companies, it is a worthwhile way for any IT professional to spend a couple of days.

Oh, and Berlin has some pretty good bars too… 

Yet again the theme of ruthless standardisation has come through strongly in interviewing some of SAP's biggest customers here at Sapphire.

Kraft Foods is one of the very biggest – 12,000 users in Europe, 30,000 more in North America by 2010, Asia Pacific to follow later, and with the software in use since 2001.

Kraft used to have disparate systems in every country in Europe, but was very much an early mover in adopting a single, standard, unmodified version of SAP across the continent.

One of the great benefits of this was realised in October last year. The firm wanted to upgrade to the latest release of SAP to take advantage of new functionality. For most companies, the prospect of a major version upgrade to 12,000 users in many countries would make them shudder. The cost and complexity of such a project is what has historically kept too many organisation stuck on older versions of applications, with a system update taking on all the characteristics of a total re-implementation.

But for Kraft, the decision to standardise paid off – the entire upgraded system was built remotely, offsite, and implemented in just three months.

To add to the achievement, the food giant also chose to change its whole IT infrastructure at the same time – and completed that in the same three month period, working with outsourcer EDS and key supplier IBM.

Kraft senior director, SAP competency centres, Jan Ziskasen, is so laid back now about his standard implementation blueprint for SAP that he was able to be in Berlin this week despite a major part of the US project about to go live this weekend.

How many IT directors would be confident enough in an impending deadline to be happily thousands of miles away on another continent?

Computing is attending SAP's Sapphire conference to meet and talk to the software giant's customers. We are, as always, far more interested in the real-life business experience of IT leaders - our readers - than the detail of the technology itself.

But for once, I found myself genuinely impressed by a product demonstration today.

SAP has worked with BlackBerry maker Research in Motion to integrate its business applications with the BlackBerry user interface and have created a truly seamless connection between the two.

The demo featured the RIM executive who was presenting going into his BlackBerry calendar, finding a meeting with a customer, then at the click of a button bringing up that customer's history from RIM's corporate SAP software.

It is the first time I have seen a real business-focused innovation in the mobile technology world for some time, and an example of the way that business executives will be using their mobile computers - be they BlackBerrys, phones or smartphones - to really keep up with the organisation away from the office.

Email and calendars are the easy and obvious tools for flexible working, but there has been much less progress made by IT vendors in making the mobile properly a part of the core business applications that actually run the company.

SAP and BlackBerry are onto a winning combination - and an example of what will one day be the norm for business.

Day two at Sapphire started with something that SAP is good at – getting high-profile customers to speak at its conferences.

So much of these events is taken up with product-related information – obviously vital for users and prospective users – but even the most enthusiastic delegates would probably admit there is only so much detail you can take.

Hearing from a fellow customer though, is a different matter and is possibly the most valuable aspect of an event like this.

This morning we heard from two of SAP's biggest users.

John Clarke, chief information officer at Nokia, talked about the challenges of producing more than 300 million mobile phones every year in what has become one of the most diverse, demanding and rapidly changing markets in the world.

Clarke talked about the way that Nokia has been transformed in the last 10 years through IT, from a company where technology was holding back the business and causing great difficulties in its manufacturing and distribution, to one recognised as having one of the best supply chains in the world.

Another little snippet I liked was the diversity of the mobile phone market illustrated by the fact that in Africa, Nokia is starting to make handsets with a built-in torch, because African users find that a particularly useful feature to have.

In a recurrence of the theme emerging yesterday, Clarke's presentation highlighted again the benefit of ruthless standardisation – driving a global company through an adherence to a single standard version of its core business application.

That was echoed by the second customer speaker of the day – Paul McGarry, international vice president of global IT for manufacturing giant Colgate-Palmolive.

McGarry said that 99.6 per cent of the company runs on SAP, and highlighted the most important benefit as "taking complexity out of our IT."

While SAP may be pushing its own marketing messages, any delegate spending time listening to their peers here talking about the realities of their day-to-day work will be taking away plenty of food for thought about the reasons why they should be taking a similarly ruthless approach to simplifying and standardising their critical applications.

Footnote – One other interesting common aspect of Clarke and McGarry's presentations was the fact they are both Brits, running global IT operations for two important overseas-based organisations. It reflects well on the quality of IT leadership in the UK – something that all the UK IT profession should take pride in and shout out about a little more.   

One of the features of big IT supplier conferences such as SAP's Sapphire is that a theme always emerges that characterises the state of the vendor's customers.

Here in Berlin, the early signs are that the theme is the benefits of standardisation.

For several years, SAP and its main rival Oracle have been preaching to customers of the benefit of rolling out a single, common version of business applications across an organisation, with no – or the absolute minimum – of bespoke changes or additions to the package.

For the vendor, this has always made sense – not only does it hinder the use of other software, but it makes the system easier to support and maintain, especially when upgrading to new releases.

For users, the story has always been a good one – lower costs, easier support, less complexity, enforcement of core processes throughout the business – but the real-life evidence of this taking place has been less apparent.

But now, some of the early adopters have finally gone live, and are here at the conference to share their experiences.

Rolls-Royce chief information officer Jonathan Mitchell presented one such case study.

The aero engine manufacturer completed a global rollout of SAP in September last year, and is already seeing the benefits.

Mitchell discussed a few key lessons learned in the Rolls-Royce project that will be of use to others embarking on a similar initiative:

• Any requests for bespoke development had to be personally approved by him – thereby making only the most essential alterations to the standard product.
• He stressed the importance of testing – the company conducted three separate full dress rehearsals before going live, and one of the fundamental tenets of the project was that testing should never be reduced, only increased, regardless of the effect on delivery timescales.
• To enforce adequate and ongoing user training, Rolls only allows system access to licenced users – and to maintain their licences, users have to attend regular training sessions.
• The quality of your chosen super-users – the business representatives chosen to be the expert users of the system for their area of the organization – is critical to the overall project. Mitchell said the role of the super-user was central to the rollout.

The company is already seeing the benefits of the ruthless standardisation enforced by using a single software package worldwide.

As more organisations share the lessons they have learned, the more we will see smaller companies adopting a similar approach.

Magazine wholesaler Menzies Distribution is an example – the firm has just embarked on a £10m, five-year business transformation project, with a similarly ruthless standardisation based on SAP at its heart.

The growing use of unmodified, packaged software in companies is not necessarily great news if you are an in-house software developer - or perhaps it is if you are looking for an opportunity to develop new skills - but it is very good news for IT leaders looking to remove complexity from their operations and use IT to drive change and innovation across the business.

Last month, SAP announced that it had delayed the release of Business ByDesign, the supplier's long-awaited software-as-a-service offering for small and medium sized businesses, after weak first-quarter financial results.

But during today's press conference here at Sapphire 2008 in Berlin, SAP co-chief executive Leo Apotheker today put the record straight, in what must be a strong candidate for the most innovative explanation for delays to a major product release by any vendor.

Apparently, Business ByDesign now has an "adjusted" rollout. In particular, SAP made a decision a while ago to accelerate the development of the product and so put extra investment into the project.

Now, all that has happened is that acceleration has been taken away, and Business ByDesign is still firmly on track to meet the delivery schedule that existed before the acceleration was put in place.

So, remember that – not delayed, merely not being accelerated any longer.

Among the 15,000 or so delegates at Sapphire 2008 there are only about 600 lucky people from the UK who, as customers or prospective customers of software giant SAP, get to attend the annual user conference hosted by the German firm – this year on home ground in Berlin.

So, if you aren't one of those lucky 600, here is Computing's guide to what you are missing out on – and given that most major IT supplier conferences run very much to the same themes, Sapphire acts here purely as a case study of what you can expect from any other similar event from whatever vendors you use.

Getting there

Book early and check in online – every flight to the destination city will be packed on the day you would like to travel. This is not because everyone on board is going to the same conference as you, it is simply an irrefutable fact of IT supplier conference travel. Leave it too late and the best flights are gone, leaving you, in this case, to wake up at 6am on a Sunday morning to make it to trusty Terminal Five for a 9am plane.

As technology experts you will, of course, also practice what you preach and check in online in advance. Unless, of course, you are the friendly PR manager from the vendor who found out on arrival at Heathrow that the flight was overbooked. She was the lucky one though – squeezed into the last seat in business class with 10 minutes to spare. Unlike the reporter from, erm, one of Computing's rivals, who enjoyed T5 for an extra couple of hours after being bumped to the next flight.

Registration

Always, always register for the event in advance. Unlike the journalist from Ireland who, quite reasonably, assumed his local PR liaison had done so on his behalf (that's generally the way it works when you're a journalist – PRs come in very handy sometimes). You can therefore guess why it is important to make sure you are registered in advance, especially if you would like a hotel room while you're there.

Don't leave it to the morning of the first day to get your conference pass and obligatory free backpack - unless you want to queue with 14,999 others for an hour or so.

Check out the corporate colours of the vendor in advance. At SAP, the garish yellow lanyard hanging round your neck for the duration of your time at the event may just clash with your outfit.

And don't put anything remotely valuable or useful in your conference backpack. It only takes two or more people to stop at any stand or presentation in the exhibition hall to find a small pile of completely identical bags on the floor, most of which will be picked up by a different person to the one who placed it there.

The venue - orientation

The UK is distinguished by its lack of the sort of mammoth conference venues required to host major vendor get-togethers such as Sapphire. Most big European cities have them, as does every US city. You think the National Exhibition Centre in Birmingham is big? It would fit several times over into these places.

The venue maps however, have rarely been designed by anyone that has actually been to the venue, but they look very pretty and geometric. Spend time studying them. (That sentence should have been prefixed with "You will have to…")

Nightlife

One rule: Remember to take off your garish yellow lanyard and conference pass before you go out for the evening, or become the target of sniggers all night from passers by and fellow delegates as your badge announce your name and company to the locals everywhere you go. There's always one.

Remember also the next morning to bring your garish yellow lanyard and conference pass with you when you leave your hotel room, so you don't have to run back and get it and keep all your colleagues waiting in the hotel lobby (guilty as charged, m'lud).

At the conference

If you come in a group, make sure all your colleagues have prepared their Buzzword Bingo cards before the opening keynote presentation by the IT vendor chief executive.

The winner today would be anyone who picked the following:

• Adaptive
• Enabling
• Business model innovation
• Collaboration
• Strategic agility (a worry for those who are only just coming to terms with the fact their business is meant to be "agile", I'm afraid we've already moved on to "strategic agility").
• And my personal favourite so far at Sapphire – closed loop business performance optimisation.

But particular credit must go to SAP co-chief executive Leo Apotheker who, during the post-keynote press conference (see below) managed to get "end to end", "leverage", "excellence", best in class" and "solutions" all into one sentence. I'd like to think he did it for a bet, but sadly I doubt that to be the case. 

Be prepared also for the product demo during the keynote – always delivered by The Wittiest Person In The Company.

Be also prepared, as delegates should have been today, for the eventuality that the product demo may, disturbingly, turn out to be more interesting than the speech itself.

Here also is a special warning for UK conference delegates – if you go to a US vendor event, especially if it is hosted in their home town, you may be expected to contribute to audience participation at the start of a keynote presentation. Americans love it, Brits just cringe with embarrassment.

In one memorable case in my experience, you may also find the US vendor executive thanking you, God, his work colleagues, and his wife and children (all by name) for giving him the opportunity to present to you and to be part of this great company.

The chief executives

At Sapphire, delegates are spoilt – here we have two co-chief executives to hear from, instead of the usual one. At Oracle events you come close, as Larry Ellison and his ego typically present together.

Chief executives of most IT companies have a common trait – the ability to speak for a very long time without actually saying anything. If a scientist could capture and recycle the hot air generated by IT vendor chief executives around the world, it could neutralise all the carbon emissions produced by flying 15,000 delegates to their conferences.

The press conference

And finally, to a section that would not be relevant for most delegates to prepare for the conference, but from a journalist's perspective is a critical part of the show.

Essential features of the press conference include:

• The planted question from a friendly local journalist that allows the chief executive(s) to explain what a great company they run. This is especially noticeable if the vendor is from the US and is hosting the show in their home country / town.
• The question supposedly "submitted on the web" that allows the chief executive(s) to outline a key part of the strategy that nobody else would ask about.
• The journalist from a small country who asks the global chief executive(s) about their plans for his country. Don't bother – they haven't even heard of the country.
• The incredibly technical question, often from someone who introduces themselves as "a blogger" that no vendor chief executive (no matter how many of them you have) is every likely to be able to answer. (Tip to chief executives – always have a chief technology officer standing by just in case – SAP did, it worked).
• The rush from the conference room to the limited number of tables / power points / PCs afterwards to be the first to get online and file a story.

It is also worth mentioning here another feature of the journalist's role at these events – the press room will always be at the furthest possible point away from where all the action is taking place at the conference (literally, in some cases at the gigantic US conference venues, perhaps 10 minutes walk away). This is done, presumably, to minimise the damage journalists can do by mingling with real conference delegates.

And so, to Sapphire 2008 and the real business of what the world's largest and most successful business application software supplier is up to...

In the early 1990s, I was working for ICL – the once and former poster child for UK IT – trying to sell big old mainframes running an operating system called VME (which stood for “virtual machine environment” – remember that, it becomes important later on…).

It wasn’t an entirely successful venture, given that most of the world was moving to mid-range Unix servers and proliferating these cheaper boxes around every department of the organisation.

At the time, I would occasionally come across an IBM customer still hanging on to their dear old water-cooled mainframes. Water cooling! Honestly. So 1970s. Air conditioning – that was the way forward.

Fast forward to this week when, while hosting a Computing web seminar on energy efficient IT, I find the expert speakers telling viewers to consider, um, consolidating departmental servers to one big central box and, err, investigating water cooling for their datacentres instead of energy-hungry air conditioning.

See? The IT industry is a fast-moving, forward-looking, innovative industry. You heard it here first – water-cooled mainframes are the next big thing. And flares.

Oh, and don’t forget the key technology that is driving the server consolidation trend – virtualisation, whereby multiple applications previously hosted on individual boxes are run in virtual servers on a single box, centralised into what you might call a virtual machine environment.

In the spirit of the IT industry’s love of TLAs (three-letter acronyms), let’s now give this technology its own shorthand – virtualisation, after all, being a bit of mouthful. I suggest that from now on, we call it VME.

Sound familiar?

Sometimes it really is true that the best ideas are the old ones. Of course IT, like anything else, goes in cycles and the trends of yesteryear find new popularity once more. Give it 10 years and we’ll have a dot com boom – Business 5.0, perhaps.

Can anyone else think of examples of old technologies and trends that are - or should be - making a renaissance today?

Here’s another one for the real nostalgists – the ICL One-per-desk (OPD), but with a voice over IP interface. It would work…

An OPD yesterday. Or in 1984.

“We have a goal to double our services business in three years, and that will make us number two in that market, but IBM will still be bigger.”

HP UK managing director Steve Gill revealed this objective to me in an interview with Computing in February 2004. It seems he was only a year or so too ambitious.

Now that HP’s $13.9bn acquisition of EDS is going ahead, it will establish the combined company as global number two in IT services and outsourcing.

The previous year, in May 2003 on the first anniversary of HP’s £12bn acquisition of Compaq, Gill predicted that the firm would overtake IBM as the world’s biggest technology supplier within the next year.

This milestone took a little longer – until 2007 – and needed IBM to sell its PC business to Lenovo along the way, but nonetheless HP got there.

For a company that has, at times, hit the headlines for all the wrong reasons – a spying scandal in 2006 that led to the departure of chairwoman Patricia Dunn; the ousting of former chief executive Carly Fiorina; the acrimonious purchase of Compaq against the wishes of one of HP’s founders’ family – current chief executive Mark Hurd has quietly gone about doing the business in the areas that matter.

HP is today a very different beast from the rather fuddy-duddy firm that entered the new millennium and had its foundations shaken during Fiorina’s often controversial tenure.

The combination with EDS will  give HP serious presence in every major boardroom conversation about IT - and lead to fevered speculation about further mergers in the sector.

Watch out for moves by the big Indian outsourcers to buy second-tier US or European rivals such as Atos Origin, Logica or CSC. Will even Accenture find itself a target – or decide it has to be an acquisitor – to compete long term with IBM and a joint HP/EDS?

And don’t rule out HP from further quiet but influential purchases along the way.

I wonder what Steve Gill is predicting now?

Most times I am rather dismissive of the latest technology conspiracy theories.

I’m somehow not convinced that microwave signals are being used to turn inner-city kids into mindless zombies.

Nor was I convinced that the breakdown in submarine cables that led to problems with internet access in the Middle East earlier this year were down to some strange covert underwater sabotage activity.

But for once, the FBI and the US government are doing themselves no favours and providing public domain material to fuel those who are convinced their every electronic move is being watched from afar.

In a House of Representatives judiciary committee hearing last week, FBI director Robert Mueller told California congressman Darrell Issa that, among other things, he sees the need for the FBI to have on the internet “some omnibus search capability utilising filters that would identify the illegal activity as it comes through and give us the ability to pre-empt that illegal activity where it comes through a choke point as opposed to the point where it is diffuse on the internet.”

In other words, monitoring all web traffic as it enters the US (and bear in mind that most international connections route through the US at some point) to prevent the cyber attackers getting inside in the first place. It’s almost an electronic version of having to remove your shoes at the airport before being allowed to enter the country.

Issa also suggested to Mueller that there be a “Cyber Initiative” whereby “ISPs that hypothetically got consent from every single person who signed up to operate under their auspices” – effectively a permanent search warrant issued through every ISP giving permission to the FBI to look at anything we do on the internet.

And to be honest, if I had read that on a conspiracy theory web site, I’d have scoffed.

Putting aside the obvious legal, moral, ethical and technical obstacles to such a move, the FBI must be pretty confident in its ability to play into paranoid US government fears to get backing for exploring such an idea.

Of course they would like to do it – and probably already do to some degree. Anyone remember Carnivore, the proposed FBI internet monitoring device that would, in theory, act as a physical firewall between the US and the rest of the world, enabling US authorities to literally disconnect the country from the internet and vice versa – the electronic equivalent of grounding all the planes after 9/11.

Carnivore was meant to have been scrapped, but it would surprise nobody if it still existed in some form.
So who is the biggest danger to civil liberty – the cyber terrorist or the paranoid administrator? Discuss...