A sure sign that the Cloud Wars are getting more lucrative and intense is how SAP CEO Christian Klein came out swinging against archrivals Workday and Oracle in framing SAP’s growing cloud momentum in Q3.
While Klein was, earlier in his tenure as CEO, steadfastly reluctant to mention competitors publicly, he’s been much more vocal over the past few quarters as SAP has rebounded nicely from the brutal impacts it felt at the onset of the pandemic in early 2020.
I think Klein’s finding a nice balance with his comments, which he’s framing as indications of SAP’s rising capabilities and momentum in the marketplace. He’s taken that measured tone even in the face of some intense public criticism from Oracle chairman Larry Ellison, and I believe that approach is serving Klein and SAP well.
In last week’s earnings call, here’s what Klein had to say about wins over Workday and Oracle:
“We saw double-digit cloud backlog growth across our whole portfolio. We are seeing positive cloud wins with S/4HANA against Oracle, including wins with Adidas and Globo International… We saw several wins against Workday with our Human Experience Management solutions, including this quarter Moy Park, a large U.K.-based food company.”
Three months ago, Klein was even more pointed during the Q2 earnings call in his efforts to showcase SAP’s successes in the brutally competitive enterprise-software industry. I offered some thoughts and details on those comments in SAP Slaps Back at Larry Ellison: ‘Hundreds’ of Q2 Wins Over Oracle.
But when it comes to the company that is by far the world’s largest provider of cloud-based enterprise applications—Salesforce—Klein avoided mentioning or alluding to Salesforce in any way, and specifically stated that SAP is taking a different approach in that CRM/CX space than it is in its full-fledged efforts in ERP and HCM.
“In CX, it’s all about focus,” Klein said when asked by an analyst to outline SAP’s “ambitions” in the customer-experience sector. “So it’s not about that we want to compete in every space.
“[We have] a huge focus on commerce and there we are clearly leading with our B2B solution in the cloud,” Klein said.
“And now we just launched our B2C solution and there too we have positive momentum. And obviously, CPQ with quote-to-cash is of course a very dominant space for us.”
Klein did not offer any details to support those claims, and as you can see he carefully skirted the issue of Salesforce by taking the position of “it’s not about that we want to compete in every” part of the CX marketplace.
I think that’s a reasonable approach for multiple reasons, not least of which is that SAP has its hands full in cloud ERP with Oracle and in HCM with Workday. Yes, in an ideal world, SAP could launch a full-out assault on the category that Salesforce dominates, but many others have tried that and have had little or no success.
Oracle’s the latest to announce an assault on Salesforce’s overwhelming dominance in that space—according to a graphic from one of the big research companies that Salesforce loves to show, it’s CRM market share is bigger than the combined shares of SAP, Oracle, Microsoft, and Adobe.
In typical Oracle fashion, Ellison has outlined a newly crafted approach to an existing market as the key to cutting into Salesforce’s leadership. I describe that strategy in detail in a piece from last month called Oracle Calls Out Salesforce Yet Again—Can Larry Ellison Succeed This Time?.
The way I see, you just gotta love the Cloud Wars—especially if you’re a customer.
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Disclosure: at the time of this writing, SAP, Oracle, Workday, and Salesforce were all clients of Cloud Wars Media and/or AccelerationEconomy.com.
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