>> Live from San Francisco, it's theCUBE covering IBM Think 2019. Brought to you by IBM. >> Hey, welcome back everyone, we're here live with theCUBE's coverage in San Francisco, the Moscone Center for IBM Think 2019. I'm John Furrier, my co-host David Vellante. Dave, we've been doing theCUBE 10 years, our second ever CUBE event was SAP SAPPHIRE, so going back into the archives. >> Great memories. >> SAP, we've been watching the SAP evolve, we've got two guests from SAP. Scot Henney, Global VP of SAP Customer Experience CX and Marcus Venth, who's a Global VP of S/4HANA, Business and Market Development, talking about enterprise, intelligence, making data, making it reason. We've been covering you guys and I got to say, Bill McDermott has always been on the front wave of all the big waves. He was talking about data and iPads right at the beginning. And the things he was talking about in 2012, 2013 is what everyone is doing today. >> Yes. >> This has been a big part of SAP, not new to you this transformation, how's the journey going? How's the partnership going with IBM? >> So, the relationship that we have with IBM is, I guess, about 40 years old and we're not even halfway done yet. You know, we're still working together and successfully delivering great business outcomes for our customers, and I think that's because not only do you have great global reach and scale, but you also understand how data and business processes impact business outcomes. Both in the back office and also in the front office too. So you were mentioning Bill McDermott. We have a phrase with inside SAP CX called, "Be Bold." Right, it's really taken in on the mantra for us and we're making some really bold acquisitions with inside the front office space. So, one of the ones he's done recently that's really focused on data is around Qualtrics. >> Yeah Huge, huge acquisition for us about experiential data and how we bring that back to organizations and we're really keen to work with IBM on that too. >> He said that was a game changer on his press conference. I watched that, I was really interesting acquisition. >> Yeah, bold move. >> Because you bring in real time data, you bring in real telemetry, real analytics, all this stuff together in a kind of new powerful way, with an existing system that SAP has been powering business software, in all these apps, what does it mean? Does this make this enterprise more intelligent, is that where is connects? What's some of the key things there? >> So, that's a really good question. So, if you can connect the back office to the front office and then create trusted relationships, then you're going to deliver a better customer experience. And that has a huge impact on shareholder value. Specifically around Qualtrics. That enables to move that next level on into what we call the experience economy. So, not only do we understand implicit data and explicit data like you were just saying before, how many people have just seen that mail, but also how they react to you. But we could also say, "What do they feel about you? "What else would they like you to do?" "What relationship do they currently have with you "and what would they like to see improve?" >> This is interesting, one of the things we talk about all the time at theCUBE is, you know, 'cause we're in the information business, we're a media company. Information's everywhere. >> Yeah >> It's knowledge and experience is the new thread. >> Totally. >> So the outcome is the word you used to use but now you're thinking, okay, if experience and presence and knowledge, this is a new kind of user experience. Is that what the intelligent enterprise is? I mean, what is the intelligent enterprise? Give us the definition. >> Right, so I think I can take that one. So, simplistically it's about taking data that you've referenced earlier on and applying new technologies to ultimately make business processes or optimize business process or come up with entirely new business models. You know, we talk about Uber and Airbnb and all these but the reality is that there are new business models being enacted within certain industries. Whether it's direct to consumer type changes or changes moving from a productized, or selling products to selling services. And so when we look at intelligent enterprise it's about taking your business partners, which are the stakeholders that make you as a company successful, that would be your customers, your suppliers, your employees and connecting them. And then ultimately leveraging the data that you're collecting as part of those business processes, applying machine learning technology, and then looking at how can we make that more efficient, or how can we now leverage that data to create new insights that then tie in to the customer experience side of things. >> You know it's interesting, John, you talk about McDermott during the big data craze. Bill McDermott never really used that term, at least not that much, but he did talk about the importance of fast data being able to respond quickly. Obviously SAP customers have a lot of data. And so you've got this platform now, this sort of data platform. How are customers making investments to, sort of, alter or modernize that data platform for this purpose? >> So, the digital platform is really interesting because what we're looking for if we look at the sort of components of an intelligent enterprise is three components. There's the intelligence suite which includes the digital core, then there's the platform, and then we have the intelligent technologies like machine learning and artificial intelligence wrapped around all of that. The platform is really helping our customers get to a more standardized approach. Where it's helping them integrate the applications within the suite. It's also a platform with which they can then implement these machine learning scenarios. It's a platform which with they can innovate and build new applications and allowing them to do that means that they can keep their core standard. And that's the key now as customers are thinking more and more about moving to the cloud, it's all about how do I keep my core clean and standard and allow myself to take advantage of those innovations and then move some of those customer specific innovations to the platform and then layer a UI on top of that, that basically means the end user doesn't know which system they're in, they're just leveraging an integrated suite. >> Substracting all the complexities and all that intelligence out. >> Yeah >> What are the obstacles for, it sounds easy, but it's not, it's hard. What are the obstacles, what's it take? Culture, we always talk about cultural sift. >> I mean, the easy, easy one is the organizational challenges, right? We see that the executive support, the charter, having clearly defined objectives and having the talent in-house that has the courage and the skillset to implement those changes. But I think one of the biggest challenges we see touches on what I was saying before where we have a highly customized environment with lots of disparate applications that really are poorly integrated and then trying to get the customers to then move that to a new platform is very difficult. So, with that, they need the courage, in many cases, to leave that stuff behind, right? >> Completely, and I completely concur. So that's the same challenge that we find in the front office. So, we aim to create a phenomenal experience platform for our clients, but unless they're reorganized internally, to remove those siloed thinking around what do sales do, what does marketing do, then they're not going to be able to fully utilize the tools and platforms that we deliver. So, it's actually about a mind shift change and about focusing on the customer. >> I'd like to get your perspective, since you're here, 'cause we go to a lot of events, we go to 120 events last year. We go to CloudNative, Computing Foundation, AWS re:Invent, we're here at IBM Think, we used to go to SAP Sapphire, but that's a different story. But one of the things we hear about is we see new trends like Kubernetes and containers. People are doing it, but they're doing it kind of like in an experimental way, or doing it, you guys are actually implementing technology with customers. >> Yes >> Integrating it in, like, mission critical kind of integrations. You're not standing up to Kubernetes, saying, "Hey we've got a Kubernetes cluster, look at this." In one or two apps, what's your experience with it 'round the integration? Because putting these piece parts together is hard. What are some of the trends that your customers are doing around really standing up cloud-native, intelligent enterprise, apps, what is some of the real use cases that our people are doing? >> I guess first of all, if we're dealing with the SAP portfolio, we're delivering a lot of those integration points out of the box, so that sort of takes away a lot of the guesswork when we talk about integrating sort of disparate applications. And I think one of the key aspects of that is just having, the plumbing is not good enough. You really need to have a data strategy around that where our data hub is then able to provide a consistent master record strategy. Where these systems can then seamlessly talk to each other. 'Cause one of the biggest problems in integrations is not the plumbing, it's actually having these systems being able to talk to each other and rationalize this information. >> Can we, maybe, do a before and after example? I mean, take a supply chain example. So, what's the before look like? What's the after, ideal after state look like, or the sort of outcome that you're looking for? >> So let's take an example, right? Let's say you're buying goods from a supplier and you now want to be connected to that supplier so that you can see where those goods are in transit. And then you want to be notified when there's a delay in those goods so that they can then adjust your production plan to make sure you're still accommodating a customer's order cycle. Now let's say, for instance, that we start recognizing a pattern, or the system starts recognizing a pattern, that every February we seem to see a five day delay, for whatever reason. Now the system can automatically start applying an additional lead time and accommodating for those changes automatically. So, that's what we think of when we think about an intelligent enterprise. It's about an enterprise that live and able to adjust and therefore able to build the trust with the customers in order to fulfill their expectations. >> I think that's a really, really important point. Can I answer that from a customer perspective? >> Yeah, please. >> Please. >> Because we're all consumers as well, of services, and also within our business lives. I think what you want, as a customer, after you've used our services and our systems, is you want to be treated like a person, right? And you want to feel like your data has been treated with some respect, yeah? And then you want to feel that promise that customer has, sorry, that business offered you is being kept. So, you want to be treated like a person, I wasn't just a transaction to you. You understand what I needed, right? And then, you treated my data appropriately. I can trust you with our relationship and I know that you're going to fill in the promise. That's what our platform delivers >> Yeah, 100%, I mean-- >> Yeah >> I ordered something, I want to know if it's not here when you said it was going to be here? I want you to either tell me, tell me why, or do something about it, not force me to call you and find out. I mean that's, it's proactive, it's anticipatory. Not reactive, or no active. >> You got it and that can only be done if you integrate the front office to the back office. And that's what IBM and SAP are working on right now. >> That's great, I mean, that's the greatest segue into my question, which is, here in San Francisco IBM Think 2019, moved from Vegas, now they're doing so, so great. Great venue 30,000 people. What kind of conversations were you guys having here at the show? Take us through a kind of day in the life. What kind of meetings did you have, what were people talking about, what's on the top of minds of meetings, your customers, and your partners at IBM? >> Well, from my perspective, there's a lot of discussion around how to move toward the cloud and what tools we have available, and so with the collaboration with IBM, they've made a tremendous investment in SAP and SAP technologies. They've built the impact assessment tools to help customers evaluate the value and the cost of making that move. And they've also invested in the impact solution, which is the content and pre-configuration to help accelerate implementations and move towards that standard. So, a lot of the discussions I'm having with customers are taking mission critical applications and moving them to the cloud. with the support of partners like that, yeah. >> And at a speed What kind of speed? It used to be weeks, months, days, now what? Cycle time for moving. >> If you go to some of those presentations there's 12, 16 week implementations out there, right? >> And when you say moving to the cloud one could infer actually moving but it may not be moving, it may be bringing the cloud model or operating model to the data, is that fair? >> Absolutely So, when we're looking at the cloud, it's not necessarily a wholesale shift. It could be a hybrid model where we're bringing subsidiaries up on the cloud and looking at more of a two tier deployment model where we're looking at an on-prem for the core business and cloud models for subsidiaries. >> It's funny the apps are driving dictating workloads or dictating what resources and architecture to it. >> So, I've had some really exciting conversations here. I was really really impressed with the conversations I had with the IX teams in IBM but also with the GBS teams. >> What's the IX teams? >> They're a-- >> Experience. >> Okay, okay. >> VR, ART, cool stuff. >> That's it, really, really cool, forward-thinking group of design-thinking experts focused on customer experience. So, the total adjustable market opportunity for CX, commerce, marketing, sales, service is over 30 billion per year. So, I don't have to come in and tell anyone what the size of the market opportunity is, the question is, where do we begin, because there is so much opportunity ahead of us. All of our market is investing around, how do I deliver better customer experience, and that's because it has a really tangible business impact. I mean, I guess, 80% of consumers have said that they have changed brands because of poor customer experience. That's a huge financial cost. And organizations that deliver better customer experience have over 200% more shareholder value delivered back. So, we've got a great business case\ and a great platform, where do we point the gun? >> You know, they bring up a good point, I want to hear your thoughts. Dave and I, internally our research team, had looked at all the successful companies that we cover. >> Yeah >> And look at the successful ones, and, you know, the not so successful ones, and look at why they are successful. And the winners, at the top of the heap, have design thinking in all of their methodologies. >> Yes >> We just had Accenture's Innovation kickoff last week. Design thinking is at the core of this. Can you give us your view on why that's the case? I mean, I'll see, I'm thinking design, is that just customer experience? Is having more or other impacts in terms of other aspects of tech, why is design thinking such a critical component, design thinking a critical component, of these new innovations? >> 'Cause I think people are, okay. So I think thinking is the operative word there. You've got to think about your customer and what they want from you. And what you've got to think about is how do I deliver a service that is compelling to you, rather than a product you may want through a channel you may choose to buy on? So, if you look at all of those organizations, they've gone through that process of thinking, "How does digital improve my customer relationship?" Because ultimately, if you don't own your customer, then you're out of business really soon. >> Marcus, bring intelligent enterprise now in context to that. Does that close the loop on intelligent enterprise equals customer relationships and impact on outcome? Am I, how does that-- >> Intelligent enterprise definitely plays a part in that, right? So I mean, when we're looking at the intelligent enterprise, especially the intelligent suite, we're really tying all the interim components together. Whether it's dealing with your employees, your suppliers, or your customers, right? So, it's really about the full end-to-end process. My particular area is around the digital core, so that's order to cash, procure to pay, order fulfillment, revenue, these are mission critical applications, right? So, when it comes to making that transformation this is not just some thing that you want to take lightly. That's where the partnership with IBM and SAP really counts. 'Cause those are the sort of partners that you want with that kind of transformation. >> You know what's interesting John? I'll make an observation. If we go back to the early days of ERP >> Yeah >> It wasn't clear that SAP was going to win. It was hard to squint through. But if you could've bet on the companies, invested in the companies who adopted ERP early, despite its complexity and the time it took, you actually could have made a lot of money. Because those companies won in the end. And I feel like you guys are on the cusp of the intelligent enterprise narrative of the next wave of competitive advantage. >> If you combine experiential data with operational data, we're going to blow past the competition and create a whole new market category. Thanks for that observation. I completely agree. >> Yeah, and it's back to your front office back office qualigers and that's why McDermott was all giddy about the acquisition. He was like a kid in a candy store. >> We're all in. >> A spring in his step. >> We're all in. >> We don't want Billy, he's already cool. >> Be bold, be bold >> Yeah. He must do a lot of handshakes. Guys, thanks for coming on theCube. Thanks for sharing that insight. Thanks for clarifying the SAP position. Great innovation. Love following you guys, we think highly of the company. Been following you guys for 10 years and look forward to continuing to track it. SAP here on theCUBE talking about innovation, design thinking, customer experience, and intelligent enterprise. theCUBE is bringing all that intelligent data to you live here in Moscone. Stay with us for more coverage after this short break. (techno music)