Core competence: Was there something?

The automotive industry started the general supply chaos on a grand scale. One company invented a new class of vehicle, and the next moment the concept was copied by competitors - regardless of their own core competence.

Today, every global car company offers every conceivable type of vehicle, from compact cars to luxury vehicles, from all-wheel drive to hybrid engines.

Naturally, the IT industry has followed suit with the car manufacturers. Is there a global IT provider that doesn't have cloud computing, machine learning and blockchain in its repertoire?

Core competence is no longer a proof of performance or a confidence booster: Today, everyone obviously has to be able to do everything. Partnerships and collaborations count for little if no one focuses on and invokes their own knowledge.

For the interested buyer and user, the market offer thus becomes a structureless and characterless arbitrariness. But those who can no longer differentiate on the basis of facts, functions and performance will orient themselves to brands and their image.

The automotive and consumer goods industries have understood this paradigm shift: Car advertising is lifestyle and image advertising. Sports shoes and sneakers are evaluated on the basis of three stripes or the wing of Hermes from Greek mythology (Mercury is the Roman name).

Obviously, the IT industry has not yet digested and absorbed this paradigm shift: Although almost every competitor also offers cloud computing, providers still try to work with this technical term instead of postulating their own company, image, knowledge and experience.

Is core competence therefore irrelevant and no longer in keeping with the times? SAP has led the paradigm shift and is now dancing at all IT high points: In-memory computing databases, blockchain, machine/deep learning, IoT, cloud and mobile computing, Industry 4.0, etc. You hardly hear anything anymore about the former core competence in the areas of FI/CO and HR. Has everything already been invented and programmed here?

From the point of view of SAP's existing customers, the areas of FI/CO and HR are still among SAP's unrivaled core competencies - hardly any other software company can hold a candle to the ERP world market leader here.

This does not mean that everything has already been invented in these use cases and that SAP should rest on its laurels: In the FI area, there are very interesting further developments with Continuous Accounting, as SAP partner BlackLine impressively demonstrates.

In HR, existing customers are far from satisfied with the "cloud computing" direction. SuccessFactors as a minimalist HR/HCM solution in the cloud may be sufficient for some users, but for the majority, the simple-minded SuccessFactors is not the answer to complex HR/HCM processes.

Under pressure from the user association DSAG, SAP has promised further development of an on-premise HCM solution - the core competence for which SAP has in Walldorf.

With the announcement to further develop HCM beyond SuccessFactors and as an on-premise solution, SAP has revealed an important and necessary decision and roadmap. In this case, SAP has stayed true to its own words.

At SAP's 2018 Field Kick-off Meeting (FKOM) in Barcelona, we were told:

"We must focus on our customers' strategic priorities to create outcomes."

At the same time, SAP FKOM 2018 also demonstrated dancing on all IT highs: "SAP CoPilot as your digital assistant", Alexa and Siri can do this better; "Automation through AI & machine learning", Amazon, Google, Nvidia and Microsoft are already much further ahead here too; "IoT is a trigger and enabler for transformation", this tells SAP's existing customers Bosch and Siemens something completely new.

SAP produces only buzzwords here, far removed from any core competence. Roadmaps for five to ten years that prove what was said are missing. SAP's existing customers should be cautious and vigilant, because the final message in Barcelona to us was without any core competence: "S/4 Hana growth is strong but start to position and sell Leonardo now!"