SAP recently announced a new S/4HANA Public Cloud solution called “GROW with SAP” which has been tailored for midmarket companies that are pursuing cloud Enterprise Resource Planning (ERP) adoption. The solution contains a combination of preconfigured business processes and accelerators that are powered by AI.
The configuration of the GROW with SAP offering is designed to help organizations streamline their operations and features a slimmed down technical go-live period between four to six weeks. GROW is backed by other foundational SAP components such as SAP’s Business Technology Platform (BTP) and SAP BUILD, which also support SAP’s RISE platform.
Our Chief Advisory Officer recently predicted that SAP would put significant energy into capturing more of the midmarket, and SAP’s announcement of GROW is a clear indication that SAP is making targeting the midmarket a priority. With 80% of its customer-base being mid-sized companies, it’s no wonder SAP sees opportunity in this segment.
Here, I will outline what GROW with SAP is, what value it brings to mid-sized organizations, and what questions need to be answered before fully engaging GROW with SAP.
What is GROW with SAP and What Features are Included in It?
There are a couple of components that make up GROW with SAP’s functionality:
- Business Technology Platform
SAP’s development of GROW was designed to support the unique and differentiating business processes an organization runs on. These differentiating processes can make up around 20% of a business’s identity and are the critical components that differentiate them from their competition. BTP provides organizations the agility and flexibility to not only build but customize these processes as their business expands and evolves.
- SAP BUILD: No-Code/Low-Code
SAP designed GROW to be a no-code/low-code development platform through their BUILD solution. The GROW offering is designed to maximize time & value from a business’s labor force. It was designed for those who are closest to the action within mid-sized organizations to focus their efforts on the strategic design and augmentation of applications rather than the tactical drain of coding.
BUILD also provides customers with integration capabilities via other SAP applications. This design is intended to create a higher degree of scalability, maximize companies’ resources, and cut out unnecessary complexities holding back organizations’ technology roadmaps.
What Value Does GROW with SAP Provide?
At a high-level, SAP’s GROW offering is centered around providing the SAP midmarket with a wider avenue to take full advantage of the Public Cloud. SAP has stated the benefits will include improved time to value, increased predictability, streamlined continuous innovation, and, most importantly, an agile ERP environment (an offering that SAP’s mid-sized customers felt was previously lacking).
Mid-sized, growth organizations often have similar business objectives as the largest corporations. But many customers have felt that SAP’s current cloud-based ERP solution set does not provide the same value and support that they are being promised. Here’s a few examples of the current gaps in value add that SAP believes GROW will solve:
- Scalability – Companies of all size are targeting scalability without the burden of additional costs and complexity taxing their internal resources and labor pool. Mid-sized organizations have felt that, historically, SAP’s cloud ERP solutions were out of their reach and couldn’t deliver to their specific needs. GROW is intended to fix two fundamental business components related to scalability: a predictable scope and a predictable timeline.
- Macroeconomic Pressures – Mid-sized organizations are often impacted more by the current macroeconomic climate than larger organizations. GROW utilizes the Public Cloud to help mid-sized organizations access the equivalent premium technology that larger corporations utilize and help solve pressing economic pressures like global inflation, cash flow, and supply chain risks.
- Market Entrants – Mid-sized companies experience an uneven playing field when it comes to the access to and expansion of market entrants that larger organizations have more readily available. This means they have lacked the number of new business opportunities, access to new markets and access to new investors.
GROW has been designed to help knock down that wall through preconfigured solutions and an untapped network of private equity and investors that provide funding, brand recognition support and additional resources such as advocates, influencers, and partners that these companies may have previously lacked.
- No-code/Low-code – Since GROW was built to feature a no-code/low-code approach, companies can optimize their resources appropriately. This is important because often the mid-sized companies lack the resources within their IT department to handle coding, whereas larger organizations are better equipped to handle this critical growth function.
What Do We Still Not Know about GROW with SAP?
Because GROW is such a new offering, and SAP has provided limited information in their press releases, there are numerous key questions to consider when evaluating GROW and the benefits it may have for your organization.
It is important to look beyond the value-add “buzz words” SAP uses and attempt to decode not only the value GROW may bring, but also the potential risks it could present to your organization. You should start by gaining an understanding of the following elements:
- What are the key commercial differences between RISE and GROW?
- What does SAP consider to be a mid-sized organization?
- Will SAP continue to target mid-sized customers for RISE deals or will they shift to only selling mid-sized customers GROW?
- Does GROW leverage the same baseline metrics methodology as RISE (i.e., FUE & pricing structure)?
- Do GROW customers still have the flexibility to select any hyperscaler of their choice?
- Who will provide the “Activation Services,” and are they bundled into the cost or are they separate line items that are negotiable?
- Do mid-sized organizations who have already adopted RISE have the flexibility to pivot their cloud ERP strategy to GROW?
As SAP continues to adapt their cloud ERP marketing strategy and segment customers by size, it will be critical to monitor the evolution of SAP GROW and SAP RISE as you determine your technology roadmap.
The Bottom Line
SAP has positioned GROW as a best-practice cloud ERP solution designed for mid-sized companies and provides a value proposition that encompasses:
- Scalability with SAP S/4HANA Cloud
- Innovation with SAP BTP
- Preconfigured business components, services, and best practices
Ultimately, GROW has been positioned to feature a faster implementation while providing the ability for mid-sized companies to “grow” and gain a leg up on their competition.
If you are a mid-sized company considering your future ERP needs, it is critical that you take time to understand the make-up of the GROW offering, including the solution components, the performance, and key commercial matters. Taking time to fully understand GROW and align internal resources can help you best prepare for exploration sessions and negotiations with SAP to ensure your program is meeting your technology platform goals and securing competitive terms.