 Orlando, Florida, it's theCUBE, covering Sapphire Now. Headlines sponsored by SAP HANA Cloud, the leader in platform as a service, with support from Consolink, the cloud internet company. Now, here are your hosts, John Furrier and Peter Burris. Okay, welcome back everyone. We are here live in Orlando, Florida for SAP Sapphire Now. This is SiliconANGLE Media's theCUBE, our flagship program where we go out to the events and extract the signal from the noise. I'm John Furrier, Peter Burris. I want to thank our sponsors, SAP HANA Cloud Platform, Consolink, really appreciate the support. And we're here with Steve Convy, who's the Accenture Managing Director Global Lead, Accenture SAP Business Solutions Group. Basically, you run all the Accenture SAP stuff, which is a big deal as the SAP entrenched in a lot of big clients, a great business. They run, their software runs pretty much the world in terms of software, that's pretty much 2%. What do you guys do in the practice? First describe what you guys do, then we'll jump into it. All right, well, John, Peter, thanks so much for the invite, great to be here. So the Accenture and SAP Business Solutions Group is a venture between SAP and Accenture, all about doing co-development of business applications, specifically for industry use cases. So the idea here is that leveraging the power of all of the technology that SAP has with HANA and their IoT platform and all the great industry knowledge that Accenture has, identify those things that are going to make the biggest impact in the industry and then do co-development, design, build, take it to market and implement it for our clients. So it's not just an Accenture practice, it's a joint venture, so it's actually a different entity? It's not a separate business entity, but we have separate divisions both within both of our organizations that focus entirely on this subject. And this is a technology-focused development? I would say it's a cross between focus on business needs and the technology enablement. So SAP, we've been here since 2010 watching this evolve and not a lot of messaging changes from previous years. Obviously, the cage was much more, and the buzz was strong yesterday, the keynote. Nothing really stood out, and other than the Microsoft CEO on stage, it was pretty cool. Other than that, it was the same game, but the integration game has been up-level for SAP this year, you're seeing a lot of it. The HANA Cloud Platform as a Service is really strong for startups. What are enterprises doing with it? Can you share your thoughts on that? Because now you're seeing the integration piece for rapid development. You're seeing people saying, okay, I got to move faster, but I have all this process, change management. Kind of older. Yeah, so what our clients are telling us is that they have their large ERP systems. They're looking for the roadmap to move to the cloud. They're looking for the roadmap to move to digital. So every organization's trying to become a digital organization for lots of different reasons. Leveraging in memory database, databases doing advanced analytics, trying to improve the customer experience. What they recognize is they got to be multi-velocity in the way that they build applications. They know that there are some applications which are pretty sturdy and don't require a lot of change, but there are many applications, usually the customer-facing applications that require change very, very quickly. So they're looking for SAP and Accenture and other organizations to help them become a multi-velocity organization in terms of how they develop apps. So SAP's done a fabulous thing in building out the HANA Cloud Platform, basically a development platform on which you can build applications very, very quickly, leverage all of the in-memory computing, leverage the cloud, and then bolt on applications and make changes to them in an agile way. What Accenture has done is recognized that we need to develop, have a development capability that mirrors that. So that's why the Accenture and SAP Business Solution Group exists, basically do agile development on the HANA Cloud Platform for the benefit of our customers. We saw yesterday a startup came on, some deep from InnoAptiv, and they went from startup to 150 employees literally in two years with the HANA Cloud Platform. That's really awesome. It shows you can stand up a venture with technology so the speed was critical, right? You can see just they just flowered up. You have any examples with enterprises? I mean, obviously, speed is important. What are some of the benchmarks that you've seen in terms of enterprises? I mean, obviously, startup has a clean sheet of paper, a little bit faster, okay, given that. But enterprises, what's some order of magnitude speeds that you've seen in terms of stuff that's been evolving and flowering out of the HANA Cloud Platform? Well, a couple things, talk about Accenture for a moment. We started our rapid application studio in January, and we've ramped up to 50 HANA Cloud Platform developers to date, targeting to be at 300 by the end of the calendar year. That's a pretty quick ramp up, as quick as a startup business, and we're a $31 billion corporation with... That's record. Yeah, that's pretty fast. But what I think our clients are telling us is that there's a hybrid model that they want to use to implement technology. They want to have their own expertise in house, but if they're not in a position to be able to acquire talent that quickly, they want to be able to leverage organizations like Accenture to be an arm of development for them, and they want us to have a very, very close relationship with SAP so that we can jointly come to them with a joint vision for what digital looks like for them, and then help them figure out how to get there very, very quickly. So Steve, one of the things that distinguished what we'll call, might call the first generation of digital, which is basically the digitization of operations, of digitizing the operating model of the firm, is a lot of new process, or a lot of relatively well understood process, finance, HR, but how do you apply technology to it? And Accenture and a lot of other companies with SAP... We dove in there to help. Took care of it. But the truth is, there really wasn't a lot of opportunity for differentiation about how you handle your operational processes. So the whole notion of sharing intellectual property and doing it really well in one industry and then doing it for somebody else in another industry wasn't that, it wasn't too tough for a lot of customers of the year. When we talk about engaging customers, you're talking about the crown jewels of the corporation. How are you... Customers, suppliers, and employees, right? The whole thing. How are you demonstrating to your clients that as you work with them with SAP and other technologies that the intellectual property that you're jointly creating with them, that you're co-creating in this rapid way is going to stay as close to them as possible, even as you go off to other firms in an industry to try to help them as well? It's a tricky question. And a lot of times the question around intellectual property gets overblown. I think the shelf life of intellectual property these days is about 18 months. After 18 months, the copycats are out there and the intellectual property's value is actually significantly less. I think the trick is if we've got some great idea that's going to create industry differentiation for you, you can't take two years to get it into the marketplace. You got to have development cycles that are measured in weeks, not in months or years. So I think the trick is working with customers and arguably there's an element of trust to this, right? Working with our trusted customers, SAP and Accenture together working with our trusted customers, coming up with an idea and not taking two years to implement it, getting it into the marketplace and have it make an impact on their business very quickly because you know the EIP is going to be stale-dated in 18 months. Well, on that thread though, it's interesting because it brings up a good point that it kind of made me think about the collaboration space, because not collaboration software in general, but essentially your studio is a joint development effort with SAP and that seems to be more of the trend now than ever before. People are working together to create stuff. That's absolutely correct. And it's not just SAP and Accenture working together because we're working in an agile environment. So generally when we do these projects, there's a client involved. And so we've got a client involved, some sort of charter client involved, being involved in the rapid design sessions, being involved in testing, and being involved in doing the postmortems on the POCs. And you're seeing cloud SaaS platforms and even platform as a service enabling a lot of cool stuff. So it kind of brings up the question of what off-the-shelf means, that term used to be off-the-shelf technologies. Well, if they're 18 months of IP to your point, 18 months, or generally speaking, the off-the-shelf term is interesting. What is off-the-shelf? How are people actually collaborating? What software are they using? What techniques, virtual workforces? I got a group in India and Russia all over the world. So you have that kind of virtual development. I think the key is the term off-the-shelf probably is going to die a slow death here because it's not about business applications anymore. It's about platforms. I mean, most organizations out there in the technology world are trying to build platforms on which things can be built very, very quickly. And the idea of off-the-shelf being good because you don't need to customize it, you just turn it on, that's going to go by the wayside because development is so easy, so simple, so quick. Well, I might take a slight exception to that in this way, that certainly if you got to generate value for a customer within 18 months, and at that point in time, the intellectual property starts diffusing, then the tradition of having three or four or five years to make money on a release starts to go away. So you've got to be really targeted and really focused in what you're doing. There may be smaller opportunities, agile opportunities to bring off-the-shelf microservices or capabilities or even SaaS to bear. So SAP might be kind of a platform and you folks might be able to plug stuff into it. So I definitely agree from that standpoint, but really what we're talking about is a pretty significant, a consequential change in the underlying structure of the software industry. Well, that is S4HANA, right? I mean, in the future, you will have a basic business platform that does, you know, the same thing that off-the-shelf on-premise did, but it's in the cloud now, right? And so all of the headache and the issues with doing application management services and managing the IT infrastructure around it is going to be a thing of the past, right? So SAP is definitely headed in the right direction. And the other cool thing that they've done is that they're building industry clouds around that base system, that base S4 system. As a matter of fact, you may have seen that Press recently, Accenture announced, and SAP announced a co-development effort to bring S4HANA and several industry clouds to market quickly, right? There's several of them in the products industry and several of them in the resources industry. But what I think is really cool about that is, so now you've got the basic underlying finance, supply chain, HR core systems. You've got industry clouds, which are focused on the basic blocking and tackling required by a consumer goods company, advanced planning and basic and things like that. Yeah, all the vertical needs that they need is customized domain expertise in there. But then they built the HANA Cloud Platform as a development tool to leverage all of that technology, but build something industry differentiating. And it's not monolithic, it's agile, it's quick, it's easy to develop, right? So, the future is in building. It's modern. Yeah, it's modern, exactly. So let me ask you a question about industry. So the basic concept of industry is, a firm has a certain organization of assets that has a relatively high asset specificity. In other words, this set of assets can be applied to this purpose and not other purposes easily. The many ad programming and software, you reduce that asset specificity. So that now that specialized set of assets is not as big or it's not as expensive as it once was. Does that start, I mean, obviously, so right now we're already seeing examples of firms going from, you know, hopping from one industry to another to serve their customers better. What is the future of an industry orientation as you see it? For Accenture, industry is everything. One of the things that clients tell us over and over again that they value in a partnership and a relationship is that we speak the language and that we understand not only what their needs are, but we have a view to the future. As a matter of fact, we've gotten very serious about this and built industry digital roadmaps for all of the industries that we do business in. And what that is in plain, simple terms is... Playbook. It's the playbook. Yeah, it absolutely is a playbook. It's a, here's where you are today, likely. Here are the industry trends and issues. You're going to be dealing with not only today, but the disruptive issues and business models and technologies that are likely to come down the pipe. This is what you're leveraging. This is what you're not leveraging. And this is where we think you should go. And it could be several paths, but it's the idea. It's the road to digital. And it's the road to getting incremental industry value out of your investment in software. Well, that's critical because when you have cloud, you have agile. You need to have that guiding principles or the 20-mile stair. You got to know where you're going. You might navigate a little bit, but there's an attack here and there, but for the most part, that's critical because you're taking a little bit more small steps. So I love that. Can you give an example of projects that you've done with the rapid development that kind of fit into these roadmaps? You mentioned a few. You know, there's two, that's great. I got a couple that come to mind. There's two disruptive pieces of technology or trends, things that are going on right now that I think a lot of organizations are grappling with and trying to figure out what the heck do I do with this? One of them is artificial intelligence. The other has to do with image and pattern recognition and all of this is another, effectively an IOT, right? It's another set of data points to feed everything that you want to analyze, understand, and then take business action against, right? So there's two POCs that we just are in the middle of completing. As a matter of fact, if you head over to booth number 114, you can see a couple of demos of them. One of them is- Is that your booth? Yeah, that's the Accenture booth. One of them is the digital assistant. So this is Accenture teaming with SAP and teaming with IPsoft around their Amelia platform. It's an artificial intelligence platform and basically we've created a digital assistant for the maintenance and management of user requests against your SAP system. So basically the use case is I forgot or I'm having trouble figuring out how to set up a general ledger account. I basically call up Amelia and Amelia walks me through the process of setting up a GL account. And the cool thing about Amelia in the artificial intelligence platform that IPsoft has is that it learns. As use cases come on stream, Amelia learns the new use cases, learns how to solve those use cases. So that's a very interesting thing. And that's right in roadmap too. We look at chatbots, you look at some of the automation going on in business process. That's kind of right in line. In artificial intelligence, you're right. The chatbots is a great example where it's evolving so quickly and it's getting sophisticated so quickly that organizations all are trying to figure out how do I leverage it. So that's the one use case. The second one is around image and pattern recognition. The specific POC that we build is for the utilities industry. And so it's a drone technology with camera and with digital feed back into a system that we built on a HANA Cloud platform and into S4 HANA. And it flies over power lines and it identifies when it sees a potential fault or short in a power line. Today, that effort is very dangerous, very time consuming, and it only covers about 10% of the total grid. With this technology, you can cover close to 100% of the grid, take all the danger out of it for employees and increase the amount of information that users have. It gives them a view, a new view into the world. Final question for you. The AI, we could use some of that, Leonard Deere from theCUBE, the producer. Got your text, he texted me on my iWatch. Final question, what's your plans coming up? What are you going to do this year? Any big events you're going to? What's the expansion plan around your group? What activities you got going on? Share with the folks watching. What you guys plan to do? We just finished a two day off-site with SAP in Waldorf, Germany, around the plan to launch and to grow this application studio. So we're just very excited about going out to our clients, SAP's clients, and identifying those key use cases by industry, and then getting those through our rapid application development. We have approximately, I think the last count was 20 in our ideation phase, and we've got eight that are sitting in prototype and several that are in the market right now, and with us growing from 50 to 300 developers by the end of the year, we want to make that pipeline a whole heck of a lot bigger. Well, we'll certainly keep an eye on you guys. Great examples, great digital roadmap, and then applying it. Love the AI, love the drone example. That's right in line with putting a toe in the water and testing some of these new technologies. Sure, IoT's will be a booming practice. That's a whole nother thing we can spend an hour on. Steve, thanks so much for sharing your insights here. Pleasure being here. Thanks, guys. We're live in Orlando for SAP Sapphire. I'm John Furrier with Peter Burris. We'll be right back at this short break. You're watching theCUBE. There'll be millions of people in the near future that want to be involved in their own personal well-being and wellness. Nobody wants to age in a way that...