Thread regarding SAP layoffs

@ba Agreed. Sadly, CK & DA will be driving in Rolls Royces when this is discovered and then a new leader will try to rebuild in 2029

@d5 The one thing you can do wrong in a big corp is being too good at what you are doing. Because others would have to ask themselves why they're not doing the same or better.

@ek

I am not suggesting SAP would "give Maintenance away", but they have made it very clear they will be exiting this business by 2027. In the end I think the following move would be made by our "former" customers as to who they will want to engage with to handle their ongoing maintenance support - I don't see how SAP can deter them from retaining 3rd party companies, once SAP drops out.

The point is that the maintenance revenue has been consistent, profitable and the backbone of SAP's overall business since the inception of the Maintenance biz. There are many companies fortune 100 and SMB that have their business processes built on ERP platform and for several reasons they will not switch/buy S4 Hana.

Given the long standing history of this biz, the number of customers utilizing annual maintenance contracts and the overall significant profitability it would not appear at all to be a good move.

We shall all see by 2028 how smart a move this was.... in the meantime there will be many, ,many companies who will be marketing themselves to our customers to fill the maintenance void left behind by SAP.

@eh

I'm not sure SAP will give away the maintenance. This is based on how Managers are blocking OnPrem engineers from moving to Cloud or AI teams/projects.
SAP has significantly reduced investment in maintenance and because of the recent restructuring now only few people has the expertise and knowledge to do maintenance so external companies cannot do it without long knowledge transfer which I doubt anybody to be interested in.

May be the smart move from SAP is a kind of spin off maintenance to a separate company that will still be tied to SAP but doesn't show in its financial numbers..

@e1+1k4876rt2

Spot on regarding ending our Maintenance revenue!!

In 2023, SAP reported a Gross Margin of 88% on Maintenance Contracts - that's nothing to be dismissed. Unless we are run by fools.

How exactly does CK or DA propose to replace this revenue stream 1:1 ??

Many of the worlds largest corporations, Fortune 100, are running ERP platforms and cannot ( or will not) jeopardize their own operations by shifting to a platform that may not be anywhere near the efficiency of what they have been running on.

Indeed we will see a departure of the most elite companies ( and many SMB's as well ) drop SAP in favor of some third party companies who are chomping at the bit to take over this very profitable revenue stream.

Would be most interested in whose brilliant idea was this anyway - CK or DA ??

our coworkers are to blame. for every 1 of us who want to excel at our careers and expand our skills there are more who rely on kissing a-s and abusing industry terms to get ahead. if you speak up your accused of being toxic.

SAP says it will drop all support for all ERP platforms in 2027, with the hope that everybody will switch (buy) S4 Hana platform.

How smart an idea is this?

The maintenance revenue which the ERP customers have paid since the beginning of SAP has provided an enormous amount of revenue for the company.

Seriously doubt that the minimal profit on the cloud market and the remains to be seen AI market will compare with our Maintenance revenue.

I would fully expect third party companies to step in ( they already are running ads) to pick up the Maintenance support on all those customers who will stay with ERP platform.

We shall all see by 2028 how good a move this really was and how the stock price responds once this becomes more widely known.

@d5

Be careful. Don‘t make yourself too easily identifiable. Take care of yourself.

I work in a team in Germany which builds BI dashboards. The user experience of these dashboards is horrible. Even after applying horizon theme, the fundamental tech stack, performance, intuitiveness and modern experience is missing big time.

Customers hate it but had to work with it. They suggest enhancements which end up in the backlog or not feasible category and eventually lost somewhere on Productboard and Jira board. The dev team is full of very experienced colleagues with atleast 10+ years at SAP, some even touching 20+ and are at their sunset period.

As a weekend fun project, I vibe coded the entire dashboard with all the features, plus most requested customer features and hooked up the dummy data and made it 10x notches better in terms of experience.

When I presented it to the team, the one thing which I heard from them was criticism, like they were protecting their turf and starting finding all the red flags in a 2 day project work on which at-least they are working since last 5 years.

I seriously wonder what kind of products SAP is building when it can take 2 days for anyone to replicate it with some experience and AI toolset. The only thing they have is data but with cloud, they will eventually lose that edge as well when customers move to other companies and take away their data with them. Good example is Workday which has taken away bulk of the market share from Successfactors in EU.

Cannot agree more with the friend @d1+1k4876rt2, Senior Technical Architect

there stock prices are up as they are at the fundamental level for AI, but our gloriously smart (with zero tech background) MBA c-suite decided the money was in the apps on top of the underlying infra. The problem with this is its exceptionally easy to compete there and exceptionally hard to make any money in it. We could have used all our business data and workflow knowledge to have built fundamental research but once again, rather than do the hard work sap is just trying to capitalise on others work. When the barrier to entry for competitors was high that worked, but in the llm api wrapper space its easy and cheap entry. We have almost zero of real value, our chat bot is a total joke that is significantly slower than just doing it yourself and a worthless piece of junk that could be hacked together by a few recent grads in a few days.

SAP is in trouble against other tech companies.

Oracle is UP + 32 % for the same time period. Microsoft is up +9%, AWS UP 10%., etc. Both customers and investors will turn to these companies who obviously have something SAP does not and drive SAP further into the hole.

If CK and DA think they can "CUT" their way out of the stock drop, they have no clue.

If the stock price does not rebound to where it was by mid Q4, they will embark on what DA calls tooth brushing ( new code word), as they will need to show the investment community they are taking action to deal with the fallout... this is for sure.