>> Voiceover: Live from Orlando, Florida, It's The Cube covering Sapphire Now, headlining sponsored by SAP HANA Cloud, the leader in platform-as-a-service with support from Console Inc., the cloud internet company. Now, here are your hosts, John Furrier and Peter Burris. >> Hey, welcome back, everyone, We are here, live, in Orlando, Florida SAP Sapphire Now. This is SiliconANGLE Media's The Cube. It's our flagship program, we go out to the events and extract the signal from the noise. I'm John Furrier with my co-host, Peter Burris, want to give a shout out to our sponsors, SAP Hana Cloud Platform, Console Inc, Capgemini, EMC, thanks so much for sponsoring us. Our next guest is Pat Bakey who's the president of SAP's Industry Cloud group. It's the core of the cloud, all SAP. Welcome to The Cube. >> Hi, it's great to be in The Cube, first time in The Cube. >> First time on The Cube, congratulations first time Cuber. Great to have you. You have, as holistically viewing across all the different lines of business, Cloud will be a very big part of the future and across all of SAP, that's the core business. Yet, now you have Hana cloud platform, you got all this other stuff going on. Now, you have cloudification of SAP in kind of a real time happening in this show, it's going to have an impact to the deployment model, the consumption model, and the economics. What's the take, what's the internal discussions? How you guys talk about it externally with costumers and how is it received? >> Right, so, you know what, I'll tell you what, this is the industry cloud organization, so, maybe I can start there. What's industry and cloud doing in the same sentence, in the same title? So, when you talk about digitization, what customers are looking for today, it's value and speed, right, speed and agility. So, the industry part of the equation is all about value. How do we communicated the value of our innovations in a message and understanding that gives the customers confidence to invest in a innovation agenda and that's kind of, historically, has always been the strength of SAP, is the language that we speak with our customers, it's well understood, we just make sure that we express that well across all industries and line of business with the digitization agenda. The cloud portion is where speed and agility comes into play. How do you move quickly, how do you move fast? If in yesterday's business the strength was your ownership of assets, the strength today, the attributes in which these companies compete on is speed, innovation, agility, and that's where cloud comes into play. >> And knowledge of the customer. How are you then bringing those two things together for your customerS? >> So, we're helping, actually, customers across all industries get closer to the customer. If there's one strategy that every customer in every industry is pursuing is get close to the customer. This is important, it may seem sort of simplistic, but it's easy to say, it's hard to do. So, we are helping customers understand what their customers and what their customer's customers are doing. It's driving a blurring of industries. You may say that I'm responsible for 26 industries, maybe oversimplifying 'cause we see this massive blurring of industries because as customers in industries are trying to get closer to their customers, they cross boundaries. >> And conversation let's them do that. >> Yeah, it's like we were talking about before, in this world of atoms, very restrictive, very kind of two-dimensional. Digital, it defies gravity, it defies boundaries, and that's why you see this blurring of boundaries in cross industry plays. >> Yeah, we're seeing that, too, you guys talk about it here, I heard it many times, breaking down the silos and the keynotes, but at the same time, you want to have that getting close to your customer mindset which means that the apps, the workloads are domain specific and there's some blurring, so the question is, how can you be vertically integrated at some level for that domain expertise and then be horizontally scalable because the data really becomes the blurring component, too, you have data moving around, so how do you guys look at that and are customers asking for this kind of architecture? >> Yeah, it's exactly, so... It's interesting, in the old world, you either had deep industry expertise in your applications, your technology, or you had sort of a broad, horizontal, and that got you a seat at the table. You had to be best in class in either of those. So, those still get you to the table, if you have those, but it may be a small table like the table that we deal with, with our customers, is an innovation table, it's a growth table, and it involves the whole board, the whole enterprise. If you get to that table, you need to have deep industry expertise and what do I mean by that? First, you speak the language, you understand their industry from a process and the capability area and then you have to express that across their businesses, so whether that business are traditional COM, the customer business around people, HR, or around procurement or even in the industries where you're taking look at supply chain or you're looking at planning, you need to be able to integrate the industry with the horizontal. When you have that conversation and that message, which we have, you're at the big table. >> The big boy table, so what are some of the conversations at the table, is it really more revenue-driving for the customer's customers? Is it cost-saving, both, is it implementation? What are some of the trending conversations that are happening at the big table? So, at the big table, at the top of the house, strategically, around this topic of digitization, the world of digitization, competition is at the business model level, that's what they're talking about which is, I know I'm in this business today, will I be in this business tomorrow and how do I compete tomorrow? It's less about the assets as we said before, what do you have, but it's the insight that you have and that's opening up a lot of new business opportunities, so at the big table, it's around business model innovation, that's what they're talking about. >> Let me see if I can connect a couple of things you said here, so it used to be that when you thought about industry, you thought about the organization of assets, your organization of assets looks like your organization of assets, how do you handle your balance sheets, but now we're talking about customers and in many respects, the new industry is defined by the things that your customers want to do that are common to your competitor's customers. >> Exactly. >> And sometimes they're the same customers. So, as SAP's ecosystem grows, as it expands, as you're able to attract, through new sources of value, to things like this wonderful Apple partnership that we want to give you guys a chance to talk about, do you see SAP's role moving from a provider of software to actually increasing the provider of a way of thinking about doing business, where SAP, in many respects, becomes an element, almost a core element, of the business model that your customers are using to make things happen. >> That is a great statement and I actually can point you in two directions and I want to get to the Apple relation because it actually expresses our strategy on taking advantage of that. So, I would say, historically, when we were just an application company, the source of innovation came from SAP, we understood business process, we understood industry, we built these remarkable applications, and our ecosystem took 'em, implemented, and customers enjoyed the success. We're in the world now of digitization and massive innovation and there's no way that we can be the single source of innovation, this is why you heard Burn, this is why you heard Robyn Bell talking about the Hana cloud platform. So, we still need to be the catalyst when it comes to defining what is remarkable about our technology and capability to solve business problems, but then we have to enable a massive ecosystem to innovate on top of that, to extend it, to innovate, and that's where the Hana cloud platform comes into play. We are setting the agenda, we are setting the expectation of what great looks like and then tapping into the ecosystems that we have. >> What's interesting about what you just said and Peter brought this up yesterday with the global CTO of Capgemini and your premise was, the old days, you knew the processes, but didn't know the technologies, and you automated those processes, now we know the technology and don't know the processes as their developing. So, you look at IOT, it's an unknown future, but you can kind of guess it's going to be a lot of data, it's going to be an edge of the network, so that reinforces this whole ecosystem point that the innovation will come in an unknown innovation way meaning that you can't say, "I'm going to automate that" 'cause it's not known yet, it's evolving. That to me seems to tie what you just said. Can you expand your thoughts on that because this is what everyone's chasing that's the startup mentality, that's the agile, that's the jump on a grenade, win the beachhead, grow a business, that's going to be the startups and the white space for you guys. >> Look, I'm a lousy dart player, all right, but I could win if I'm throwing a thousand darts at a target and the other guy's throwing three, that's the environment we're in with Hana cloud platform, we got massive darts to throw at the target because it changes so fast you need to have a couple things, you need to have that great ecosystem, you need to be able to innovate, and you need to be able to address volatility. Let me give you a practical example of that. If you take a look at digitization and one of the key dimensions which is how work will be done in this new digital world, we have some pretty good ideas how it's going to be done such as it's not going to be done inside of the enterprise, whether that work is a manufacturing environment or that work is knowledge management in a typical office, it's going to be increasingly mobile and these mobile workers will be connected. And the challenge there is one, how do you understand what the processes will be? We have an idea, but they're going to evolve and second, how do you enable them with real time information 'cause the mobile experience isn't just taking the desktop and putting a different form factor on it, so we take a look at the Apple and SAP announcement, what does this mean? When you hear Tim and you hear Bill discuss it, it's a step change in how these two great companies believe work will be done in the digital world. The way that we execute on that is, again, back to what I said before, we will bring the best of a consumer, user experience, with the best of a business insight experience and bring those together and if you take a look then at what is the standard of a mobile platform, it's iOS which, by the way, is severely underutilized. It's chat, it's phone, it's email. If you take a look at your iPhone and how we're using it as consumers, that's massively underutilized in an enterprise setting, same thing with business information, when you leave the office, you're leaving all that behind, SAP will bring all that, the business process, the business insight, you bring it together and you have these new native applications. >> Interesting, too, on the Apple, by the way, congratulations it's a real phenomenal announcement, super happy to see that. The other nuance there, too, is that swift programming languages is very popular among developers right now and there's also another trend in the developer community what they're calling the non-coding developer, the tools are getting so damn good now that you don't have to go to be a computer science major to write code and there's other, Python, other languages that are good on-ramps, so you have an ecosystem that has the glam of Apple and the sexiness of swift. There's all this monetization opportunities. There's a developer saying, "Hey, I have an ecosystem "I can work with, that I can ride on the back of, "to the marketplace," so it's a great avenue for someone or now business to pick a white space and dominate it, whether it's a tool or a feature, they can come in and be a feature and still be a business, you'll be saying, so could I, was, "Oh, that's a feature not a company." That was the old way, now that's the innovation coming from these entrepreneurs, that, to me, is interesting. Are you guys seeing that kind of excitement from developers and do you see the developers as the core of the ecosystem? Well, what's your thoughts on that, overall? >> We're seeing the developer community becoming a more critical part because it's not just about implementing, remember when I said we're the source of innovation and other people implement it, that the skill set of the ecosystem, now when it's innovation, the source of the innovation needs to come from the ecosystem, and that's the developing community. So, if you take a look again at this Apple announcement, the reference applications and what we're building right now because that's what we and Apple think would look great in specific industries, but then it's this SDK and the Hana cloud platform. If you take 2.5 million SAP developers and you take 12 million iOS developers, you bring 'em together, not only just to work together, but to redefine what this new developing environment is, swift, right, the best of how you design enterprise applications or commercial applications and then the third leg of this is the iOS university because these are new classes of developers and my final point is as much as we think we know how work will be done in this mobile work environment, it's going to change, it's going to change. >> IOT's important, but people are going to work together with people over distance over agendas over boundaries, that's going to change the world. Let me ask you a question. We'd asked a couple of times to some of your folks on The Cube, Is it going to possible at some point in time, I'm going to get an Apple developer who decides to enter into an enterprise space by creating a solution, have an Apple phone customer go up, pull something off the app store because it is SAP complaint, is that going to happen? >> I can envision that happening, I can envision it. It's we are the standard for a trusted enterprise partner. >> Well, think about it, so now you got a situation where you your CIO and your IT organization who wants stable, comply in SAP, and then all the folks out in the field that are doing the work, that are identifying new problems and finding software that they can apply to solve the problem and having SAP and Apple bring both of those sides together, so that the CIO can be certain that what was just grabbed works and is compliant, but also, at the same time, that person knows that this innovative thing is not going to create problems in the backend. Very, very powerful vision, loved to see that notion. >> Yeah, and I think that's what you get when you combine those two brands and those two experiences. As quickly we're innovating and moving forward, you still need to have predictability in the business and a strong core, right? It's the business continuity, so you need to be able to innovate very quickly, rapid innovation, quick failure, fast learning, that's at the edge. So, if we can enable that, but give the predictability and the stability in the business relationships, security, you bring that together, this is the new world that we're creating, calls for new developers, calls for new ecosystems, and new leadership, and that's what we and Apple bring to the equation. >> So, Pat, share the roadmap on the Apple thing, just to kind of just to take the final close, square this out in little bits. Ecosystem, I get the ecosystem, I would evision that's a great outcome. >> Yeah, absolutely. >> Certified SAP apps in the Apple, I'm sure that's the plan. On the SAP side, you're going for the low hanging fruit, you mentioned that you're doing a couple of things, what's the roadmap for the sequence and the progression of SAP-Apple relationship? What are you guys bringing to the table from the core software? >> Yeah, so we've identified specific industries where the dynamics play to the favor of the dynamic at work, so they're mobile, they're standardizing already on iOS and they're connected and they need the rich enterprise information and we've identified high-values cases and those where we'll build the applications, but what we want to do-- >> John: That's a low hanging fruit for you guys. >> That's a low hanging fruit. And create that kind of references of what a great mobile experience looks like and then we're going to enable through the SDK, the ecosystem, so that's where the massive innovation is going to come from and then we'll try to figure out where this takes us. This is a series of six month sprints that we're on. >> Business sprints Love that concept. >> You know, this phrase, a couple of years ago, the speed of business, I forget which SAP soft, I remember in 2013, McDermott's phrase was "Running at the speed of business" with the mobile. Final question for you is, on the Industry Cloud, what's your plans, what's your goals, how do you see it evolving, can you share some anecdotal, you don't have to reveal any sensitive information, but the visions for how you see the Industry Cloud group that you're running, evolving over the next 12, 48 months? >> So, I see us, right now, that there's some things your core values and your core competencies shouldn't change, they should sort of leverage the environment that you're in and so, we're caring for our industry in sight, our focus on an end-to-end capability, high-values cases, and integration where it needs to be and that's what we express. So, we're going to take that and we're going to apply it to helping customers digitize on that journey. Here at Sapphire, the focus has been not on what we're announcing because ask any customer here, we have the requisite capabilities, what they want to get is busy on their journey and they want us to help them reduce uncertainty, reduce risk, and realize value. So, all the conversations here on what are we doing, industry, clear road maps, where we going? What capabilities? Second, road map on value, what value? S4, fastest launch in our history, customers, right now, are saying, "How do we double that, how do we triple that? Is by showing the business value associated with it. So that's what we're doing with industry, is showing a clear path of what great looks like, a road map on how to get there, the business values associated with it, and how working our digital business services customers, how we can help them realize that. >> And the road map is key because that clarifies the ecosystem. They understand kind of the rules of engagement. They can see the line. >> Yeah, what their overall is used. You know, it's interesting, Pat, you look around, there's 60,000 people, the amount of activity, the amount of deal making, that's going on here, it's probably the 25th largest economy in the world right here. >> Oh, it is, in Orlando, that's amazing. Yeah, I need to take a knee guys, I was just hearing about that. >> Final question and I'll let you go 'cause we got to go, we know you're tight on time, what's the coolest thing you've seen at Sapphire this week? >> Coolest thing, boy, I've been in so many meetings, I haven't seen cool. >> Peter: Other than this one. >> Oh, yeah, this is definitely a cool meeting. Oh, geez, coolest thing? >> Coolest phrase, sound bite, feedback, hallway conversation. >> What are you going to tell, in your next management meeting, what's the one thing you're going to tell 'em about Sapphire? >> I'd say that there is so much demand for us to help customers. We're not pushing, we're getting pulled. So, it's about prioritization like how do we focus on what's most important for our customers? That's such a lame answer. >> Peter: Well, but the prioritization of-- >> When you're looking for cool, but it's true. >> There's drones somewhere, I saw a beer tap that got IOT on it for-- >> I did see the guy in kind of the transformer outfit, that was pretty cool, but I'll tell you what, as we become more and more of consumer business oriented, my kids start developing a better understanding of what I actually do when I leave home. It's cool, I mean, SAP is cool. Actually, I'll tell you the one thing. The one thing I heard here from customers that either went to original Sapphires and are back after a while or coming for the first time, they can't believe how fast we're moving. They really can believe how fast we're moving. It's that speed, it's not just the pace of this conversation or the pace of the traffic around here, it's the pace of how quickly business is moving and that we're leading it. >> Pat Bakey, president of Industry Cloud, SAP, this is The Cube, I'm John Furrier with Peter Burris. Be right back, this is The Cube, SiliconANGLE's flagship program. This is The Cube, you're watching The Cube, we'll be right back. (fun, upbeat melody) >> Voiceover: There'll be millions of people in the near future that aren't allowed to be involved in their own personal well-being and wellness. Nobody wants to.