Thread regarding SAP layoffs

Is SAP wrong with betting all in on the cloud?

What does the experts think?

Some factors against it for companies:

  • Trusting external cloud providers with sensitive data
  • Cloud benefits vs incremental costs
  • Failed migrations, difficult customisations
  • Data lock-ins and access lockouts in case of unfavourable views. Remember AWS locking out Parler app.
  • Chasing the fad (jump to the cloud => wow => reduce cloud costs => optimise the solutions)

For SAP:

  • Low profit margins
  • Short term contracts (1-3) years
  • Big competition from cloud natives
  • Faster product upgrade cycles
  • ML computation power to support AI use cases
  • ??

Market analysis on cloud exit:

  1. https://www.infoworld.com/article/3704228/cloud-may-be-overpriced-compared-to-on-premises-systems.html
  2. https://www.datacenterdynamics.com/en/opinions/bringing-the-cloud-back-on-premise-improving-security-and-reducing-costs/
  3. https://www.infoworld.com/article/3684369/2023-could-be-the-year-of-public-cloud-repatriation.html
  4. https://world.hey.com/dhh/the-big-cloud-exit-faq-20274010

Are we chasing the wrong tale and making another strategic mistake by going all in on the cloud?

by Anonymous
| 2061 views | | 3 replies (last February 3, 2024) | Reply
Post ID: @OP+1qPVDBeG
Comment! It's anonymous!

3 replies (most recent on top)

SAP is not losing money by moving customer's on-premise systems to cloud using Rise with SAP offering.

by Anonymous
| | Reply
Post ID: @4ufo+1qPVDBeG

Some would wonder why this topic is relevant on a layoff specific website.

IMHO the executive board is overly optimistic about their move to on-cloud and disregard of the cash cow of On prem business makes me question their strategic acumen.

This strategic move to on-cloud directly or indirectly influenced the 3K layoffs of 2023 and 8K layoffs of 2024.

I’m calling it a layoff because no data has been shared whatsoever of how many of the colleagues were able to find other alternative positions and how many were let go.

They are chasing the tail of the trend and not looking at the newer evolutions taking shape.
Nice articles!

by Anonymous
| | Reply
Post ID: @1uio+1qPVDBeG

All that is required is just to think of the loss of maintenance revenue we will lose once we complete this move to the cloud and lose our credibility as an on prem company.

Some other company, much smarter than we are, will gladly come in and pick up the maintenance support on our legacy ERP customers.

Think of it like this, we are giving up a 100 gallon drum of revenue which the maintenance provided to get a one ounce cup of cloud revenue, which we will have to fight like he-l against all of the other providers like Oracle, salesforce, AWS, MS....

by Anonymous
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Post ID: @hop+1qPVDBeG

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