SAP has sent out a strong statement of intent to its New Zealand channel, directing Kiwi partners towards the rapidly expanding small and medium-sized enterprise space.
With SMEs continuing to act as the country’s backbone - representing 97 percent of New Zealand businesses - the global tech aims to aggressively capitalise on the local make-up of the market, advising the channel to follow suit in 2016 and beyond.
Specifically speaking, the 459,300 enterprises representing the small to medium business sector nationwide include those with no employees, micro (1-5 employees), and small (6-19 employees) enterprises.
As highlighted by the Government recently, small to medium sized businesses continue to make a significant contribution to the New Zealand labour market, with more than 584,000 people employed in enterprises with fewer than 20 people, making up 30 percent of the workforce.
For Sumal Karu as General Manager, Global Channels & General Business, for SAP Australia and New Zealand, this represents opportunity.
“We will be focusing heavily on the SME market in New Zealand this year,” said Karu, when addressing Kiwi partners in Auckland during the company’s A/NZ Partner Kick-off Meeting last week.
From a global perspective, there are 79 million SME companies worldwide, all of which are experiencing rapid growth - some 2-4 times faster compared to large enterprise market growth.
The knock-on effect, according to Karu, is that the SME market is set to spend $US609 billion in 2016 on IT, citing a number of SAP specific solutions tailored to meet demand.
“Whether it be Digital Foundation, Fully Integrated or Cloud and Mobile solutions from our SAP suite, we are focusing on helping our partners deliver simpler solutions to the expanding SME market,” he added.
In stripping away the jargon and marketing speak, Karu told partners that by looking at every business today, it’s clear that they have to transform in a digital centric way because if they don’t “they’ll get consumed by the market.”
“Consolidation is happening,” he advised. “The ankle biters out there are coming up with innovative ways to go to market and are taking out traditional players. That’s happening.”
At present, Karu believes that everything is driven around customer experience, regardless of industry.
“If you’re broadly looking at a B to C type industry it’s about customer experience, if it’s a B to B type industry, it’s about how efficiently you engage with your partners or customers.”
But with 2016 now underway, Karu admitted the critical question lies around how the channel can figure out how to capitalise on the growing opportunity within the market.
As such, Karu spoke of the the 3rd Platform, a IDC label that refers to mobile technology, cloud services, Big Data, and social networks.
“In its simplest view, the 3rd Platform notion is that there is a platform in your business, regardless of industry, that will be the enabler to connect and reach your customers and routes to market,” he explained.
“We believe the 3rd Platform is something we have. Look at our cloud capability, our processing capability, SAP S/4HANA and our mobility plays - we have that capability.”
When speaking to customers, Karu advised partners to assess what needs to be solved today, before embarking on a roadmap which “gets you to an aspirational point of the 3rd Platform.”
“Once you’re at that point,” he explained, “it evolves but the key thing is having a roadmap to get to the 3rd Platform.
“Our ecosystem is in a state of readiness to deal with this change and I’m not talking years, I’m talking months.”
Citing SAP S/4HANA - SAP's next generation business suite designed to help run in a more simplified manner in a digital and networked world - Karu believes the time has arrived for partners to “leverage this play” in New Zealand.
“Now’s the time to get certified and become accredited,” he added.
But perhaps crucially, Karu - who officially joined SAP on February 1 - was also quick to advise that the wheels of change are in motion with regards to making SAP’s dealings with local partners easier, built around a simplified philosophy.
“We’re trying to operate as simply as possible,” he added. “But I appreciate it’s easy for me to stand up in front of Kiwi partners, only seven days on the job, and say we’re going to simplify everything, and partners are probably thinking “yeah right”.
“But change is coming, and it’ll be based around the little things. We want to speak to as many local partners as possible, as quickly as possible, to better understand the little things that we can tweak to make a big difference.
“Having been at SAP for only seven days, I appreciate the massive aspects of complexity, but I assure you there’s a lot of positive intent. We’re cutting through that complexity to come back to the main point, and that centres on what is relevant to you to make your business successful this year.
“Our value is to ensure our relationship is a relevant one.”
Referring to the company’s six key pillars of focus in New Zealand for the year ahead - SME growth, S4/Hana, 3rd Platform, Cloud, Partner scaling and simplicity - Karu also welcomed on board SAP’s new Channel Manager for New Zealand.
With a strong background in channel management, Eisa Quelette joined the local team in early 2016, following four years at software solutions and services provider Solnet.