SAP’s recent financial disclosures highlight a robust performance in the APJ market. Cloud revenue in this region soared by 14%, hitting the €442 million mark, which translates to a 27% uptick at constant currencies. Moreover, this accomplishment wasn’t limited to a few sectors or countries; it spanned across a diverse range of industries and nations.

Key players in the global market, like LG Electronics, LG Energy Solutions, Ricoh Co., Hitachi Zosen, and Hyundai Kia, have all placed their trust in SAP for their cloud endeavors. Furthermore, other notable companies from the region, such as Toll Group and Clean Max Enviro Energy Solutions, have also made significant strides by collaborating with SAP.

Another area where SAP has been making waves is among small and medium-sized businesses, with firms like Tait International leveraging SAP’s cloud transformation solutions.

The Bigger Picture: SAP’s Cloud Growth Strategy

When you zoom out and view the broader scenario, the appeal of SAP’s offerings becomes evident. SAP’s global cloud revenue rose by 16%, and their S/4HANA Cloud revenue spiked by an impressive 67%. These numbers don’t just represent figures on a balance sheet; they signify the trust and reliability that global brands associate with SAP.

Brands like LG Electronics and LG Energy Solutions in Korea have turned to SAP Private Cloud to underpin their business transformations. Similarly, Hyundai Kia, Ricoh Co. Ltd, and Hitachi Zosen have expressed their confidence in SAP’s solutions for their cloud transition.

Paul Marriott, President of SAP APJ, highlighted that businesses across the spectrum, from burgeoning startups to established conglomerates, are realizing the potential of SAP’s cloud solutions. These solutions not only enhance flexibility and innovation but also drive positive business outcomes. SAP isn’t merely focused on cloud expansion; they’re pioneering in domains like sovereign cloud, sustainability, and AI, ensuring they remain at the forefront of transformative innovation.

Furthermore, the resonance of SAP’s cloud strategy is evident, with brands such as Celltrion Healthcare, Gulf Marine, and PETROS benefiting from SAP’s comprehensive approach to cloud transformation. Their suite, inclusive of RISE with SAP, GROW with SAP, and SAP S/4HANA, has also proven invaluable to several firms.

APJ Success Stories Highlighted in SAP Financial Results

Celltrion’s Success: Undergoing a digital transformation, Celltrion tapped into the SAP S/4HANA Cloud, which resulted in a significant reduction in their monthly closing period and manual tasks, ultimately fostering efficiency and readiness for future global expansions.

CleanMax’s Vision: As Asia’s leading renewable energy provider, CleanMax sought to bolster its sustainable mission. Their collaboration with SAP in deploying various SAP cloud solutions has laid the foundation for a brighter, sustainable future, marked by improved decision-making and efficient reporting.

Gulf Marine’s Evolution: With operations spanning over 1,000 ports in 80 countries, Gulf Marine realized the need for an ERP system to bolster their growth. Their choice of the SAP S/4HANA public cloud is a testament to SAP’s reliability in modernizing operations and streamlining processes.

UPL Limited’s Perspective: Pushkar Rege, UPL Limited’s Global CIO, emphasized the company’s decision to opt for RISE WITH SAP. This decision was instrumental in building dedicated platforms tailored to UPL’s specific industry functions and objectives. With SAP’s assistance, UPL is well on its path to faster innovation, improved scalability, and enhanced control over its IT infrastructure.

The recent SAP financial results for Q3 2023 not only depict a successful quarter but also foreshadow the potential and trajectory of SAP in the APJ region and beyond. As businesses across the globe continue to evolve and adapt to the ever-changing technological landscape, SAP stands as a reliable partner, ready to aid in their transformative journeys.

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Last September, SAP was recognized as a Leader in the Gartner Magic Quadrant for Cloud ERP for Product-Centric Enterprises on the strength of SAP S/4HANA Cloud’s completeness of vision and ability to execute in the cloud ERP market, demonstrating that SAP’s cloud strategy continues to gain traction around the world. Earlier in July, SAP had already been recognized as a Leader in the Gartner Magic Quadrant for Cloud ERP for Service-Centric Enterprises.

This month, SAP disclosed its profits for the third quarter of 2022, achieving a successful cloud quarter with rising performance across all metrics. The worldwide cloud revenue was up 38% to €3.29 billion, or up 25% when adjusting for currency fluctuations. This increase was driven by double-digit growth across the entire Software as a Service (SaaS) and Platform as a Service (PaaS) portfolios.

In particular, SAP’s cloud revenue in Asia Pacific and Japan (APJ) reached 411 million Euros in the third quarter of 2022, representing a 27% increase over the same time in 2021. The combined sales for the Asia-Pacific region in the third quarter of 2022 amounted to 1.1 billion euros, representing a 5% increase over the previous year’s figures for the same time.

SAP APJ President Paul Marriott explained that businesses are beginning to see the benefits of SAP’s flexible, expandable, and innovative collection of cloud-based product offerings — building on the German tech giant’s strength in interconnecting enterprises and streamlining processes. He further shared in an official statement:

“Our cloud-centric strategy and best-in-suite portfolio are helping customers across APJ address their most pressing challenges, from cloud-based business transformation to bolstering supply chain resilience and building sustainability into the core of business.”

Latest RISE with SAP Q3 Customers in APJ

Leading Asian enterprises have been embracing SAP cloud technologies at a significantly faster rate across all sectors, and there has been ongoing demand among diverse client bases for the company’s Business Transformation as a Service (BTaaS) signature cloud offering RISE with SAP. By integrating a variety of SAP cloud products and services, the RISE with SAP program provides clients with access to an integrated suite of services and solutions that are intended to assist customers in realizing the benefits of the scalability offered by cloud computing.

Tokyo-headquartered multinational imaging and electronics company Ricoh Co., Ltd. and Indian multinational consumer goods company Dabur Ltd. were among the new RISE with SAP customers added in the Asia Pacific region during as announced in the latest SAP Q3 results.

• By integrating RISE with SAP, Ricoh Co., Ltd. will speed up the process of standardizing and enhancing the efficiency of its manufacturing and service parts management activities, therefore enhancing the company’s preparedness to adapt to future shifts in business models. The corporation plans to automate internal business operations and push for business changes by making use of cutting-edge technology like artificial intelligence (AI) with the help of robotic process automation (RPA) and cloud services.
• Dabur Ltd., the fourth biggest fast-moving consumer goods (FMCG) firm in India, with operations in over 120 countries and close to 7 million local retail locations, selected RISE with SAP to drive its innovation-led initiatives. Better business planning and higher standards of corporate governance will result from the solution’s ability to integrate its treasury and risk management workflow with its core business activities. In keeping with its environmental goals, the firm has begun shutting down its old data center and has partnered with SAP to accelerate the transition to the cloud.

Moreover, the German enterprise software giant also announced that Australian pharmacy retailer Chemist Warehouse and Indian retail company Trent Ltd. have chosen the SAP SuccessFactors Human Experience Management (HXM) Suite to help them develop the workforce agility required to keep up with constant changes in the post-COVID 19 pandemic environment. Both companies plan to utilize SAP SuccessFactors to drive their digital transformations and to modernize their respective HR systems.

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In April, SAP reported its financial results for the first quarter of 2022, emphasising the consistent growth of its cloud business and incorporating the current cloud backlog. The German enterprise software giant has revealed a strong cloud momentum as evident in the current cloud backlog and SAP S/4HANA cloud revenue, reaching double-digit growth. This follows the remarkable performance of the Business Transformation as a Service (BTaaS) offering RISE with SAP in 2021 as a springboard for the first months of this year.

In Thailand, the tech giant intends to drive the transformation to the cloud for companies in both the private and public sectors by utilising its most recent business direction plan, which includes the concept of the ‘Cloud Only’ strategy. This is primarily aimed at helping enterprises improve their efficiency, flexibility, and agility. It can be noted that Dr. Sak Segkhoonthod, Advisor of Digital Transformation at the Electronic Transaction Development Agency, told a seminar held in January that as the country’s present regulations for budget disbursement can be easily maintained on the cloud, organisations in the public sector can migrate to the cloud with relative ease.

According to SAP Indochina Managing Director Atul Tuli, the global COVID-19 pandemic has shown itself to be a fast-acting driver for governments and businesses to expedite their digital transformation journeys and embrace cloud-based technologies for growth and sustainability. He also believes that enterprises can innovate ahead of their competition, operate through times of volatility in the market, and boost cost savings by using a cloud-based enterprise resource planning (ERP) system that provides real-time business analytics.

Advancing the SAP Cloud Strategy for the “Intelligent, Sustainable Enterprise”

As per Gartner’s projections, end-user expenditure on public cloud services around the globe is expected to increase by 20.4{aa282f308afcc222aaa21b0478c79e01a8fedd01972e2180867097bd93930f22} in 2022, reaching a total of $494.7 billion. In particular, cloud computing spending in Thailand is expected to increase by 36.6{aa282f308afcc222aaa21b0478c79e01a8fedd01972e2180867097bd93930f22} to reach 40.8 billion baht in 2022. This also indicates that as the pandemic unfolds, the country will embrace the “golden age of digital transformation” with cloud solutions playing a crucial role in helping enterprises transform sustainably.

“Today, businesses can easily migrate their applications and workloads to the cloud with the ability to scale and enjoy the benefit of cloud’s pay-per-use model to reduce total cost of ownership (TCO). We believe that the ‘Cloud Only’ strategy will help drive SAP Thailand’s cloud compound annual growth rate (CAGR) by 51{aa282f308afcc222aaa21b0478c79e01a8fedd01972e2180867097bd93930f22} by 2025,” SAP MD Atul Tuli further explained.

In terms of achieving the “Intelligent, Sustainable Enterprise” vision, SAP Indochina Key Account Sales Leader Kulwipa Praditphollert stated that SAP has taken the initiative to supply forward-thinking businesses with real-time data and technology, intending to empower and enable them to seek sustainability and long-term growth and efficiency. She added:

“Over the past years, we have supported customers in various industries, including retail, healthcare, chemical, e-commerce, and offered them solutions ranging from supply chain, procurement, human resource management to customer experience management.”

Helping SMEs Future-Proof Their Operations

“Transformational Talent: The impact of the Great Resignation on Digital Transformation in APJ’s SMEs”, a study recently conducted by SAP and commissioned Dynata, revealed that 68{aa282f308afcc222aaa21b0478c79e01a8fedd01972e2180867097bd93930f22} of Thai small and medium-sized enterprises (SMEs) agreed that having technology partners who can assist with digital transformation is an absolute necessity for them to survive and thrive. Moreover, 66{aa282f308afcc222aaa21b0478c79e01a8fedd01972e2180867097bd93930f22} of SMEs reported that they were at a loss as to how to get started.

SAP Indochina Head of Mid Market Noppadon Chareonthong stated that there are more than 70 partners in the ecosystem that play a significant role in SAP Thailand’s engagements with customers in the SME segment. He added that partners are essential in providing guidance and assistance to customers in terms of running their business and implementing SAP systems.

“As 80{aa282f308afcc222aaa21b0478c79e01a8fedd01972e2180867097bd93930f22} of SAP customers worldwide are SMEs, we have worked tirelessly to help SMEs customers in Thailand embark on their digital transformation journey towards becoming Intelligent, Sustainable Enterprise to create a strong and sustainable digital core in the future,” he further said.

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In the fourth quarter of 2021, SAP’s cloud revenue grew by 24{aa282f308afcc222aaa21b0478c79e01a8fedd01972e2180867097bd93930f22}. It is increasing at an 18{aa282f308afcc222aaa21b0478c79e01a8fedd01972e2180867097bd93930f22} rate in the Asia-Pacific (APAC) region, which accounts for a third of the company’s overall business. In Thailand, the German enterprise software giant anticipates a 51{aa282f308afcc222aaa21b0478c79e01a8fedd01972e2180867097bd93930f22} compound annual growth rate (CAGR) in terms of cloud uptake by 2025. According to global tech research company Gartner, cloud spending in Thailand could increase by 28.2{aa282f308afcc222aaa21b0478c79e01a8fedd01972e2180867097bd93930f22} in 2022, reaching 34.4 billion baht (US$1.1 billion) approximately. Experts predicted that local businesses would invest more in cloud solutions this year as they continue to prioritise crucial technologies to assist them in maintaining daily operations during the COVID-19 global pandemic.

During a recent visit to Thailand, Scott Russell, Head of Customer Success and Member of the Executive Board at SAP, explained the company’s commitment to helping organisations turn into intelligent, sustainable enterprises. In terms of SAP’s business in the country, he further shared:

“SAP has a proud history with government agencies and enterprises, major conglomerates, and family-owned enterprises in Thailand. Our customers have depended on our technology in some cases for 20-25 years. Now, they are turning to us to make them more agile and sustainable and that’s where the cloud comes in.”

“As Thailand businesses emerge stronger from this pandemic, they need to address such urgent issues as talent retention and development, sustainability, and supply-chain resilience. A cloud-only strategy is key to them surviving and thriving,” Russell added.

Leveraging Solutions and Technologies of SAP in the Cloud

Furthermore, the strong uptake of SAP S/4HANA Cloud intelligent enterprise resource planning (ERP) system can be linked to the performance shown by RISE with SAP — the German tech giant’s Business Transformation as a Service (BTaaS) signature cloud offering. An increasing number of organisations intend to use the solution to help in the development of new business models and transformation of mission-critical applications to gain operational efficiencies.

Particularly, Thai customers that are already harnessing the power of SAP cloud-based solutions include DoHome, a retailer and wholesaler of construction and home decoration materials, and Thai Medical Glove, a major rubber glove manufacturer in Southeast Asia (SEA). Utilising SAP technologies, DoHome expanded its operations by commencing on a digital transformation journey and transitioning away from its traditional business models. Meanwhile, Thai Medical Glove leveraged cloud technologies such as RISE with SAP to modernise the company and transform it into a sustainable, intelligent enterprise.

CPRAM, a food manufacturer, and CP Retailink, an equipment supplier and service provider for 7-Eleven outlets —-both of which are subsidiaries of the CP Group —- are using SAP products to reimagine critical business processes and lay the groundwork for future growth. According to Russell, real-time analytics and performance visibility were needed by the companies because of the large transaction volumes experienced during the pandemic. He added that their partnership with SAP has improved their ability to handle and integrate complex data as well as their capacity to deliver better experiences more rapidly than before.

“In Thailand we’ve seen a real acceleration of human capital management solutions and supply chain planning. Operating in the cloud brings the desired agility. You’re able to get the latest innovations in real-time without setting it up yourself,” he remarked.

With the world being divided and volatile due to COVID-19, Russell further emphasised that companies that do not invest in cloud computing technologies are unlikely to be able to maintain their competitive advantage in the future.

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Last month, Pakistani President Arif Alvi spoke at a ceremony in the city of Karachi to mark the launch of the Presidential Initiative for Artificial Intelligence (AI) and Computing. He stated that the current government is providing all possible support to the country’s IT industry, adding that various laws have been enacted to expedite the sector’s growth and foster scientific and economic development. 

Given the rapid development of countries that focus heavily on AI and computing technologies, President Arif Alvi advised the Pakistani youth to pursue IT education in order to take advantage of the numerous opportunities available in the field globally. He said that the Pakistani government has implemented various initiatives aimed at supporting the country’s youth, including the free Digital Skill Program, which provides IT training via online classes.

It can be noted that in 2020, Pakistani Prime Minister Imran Khan has made an invitation to German tech giant SAP to establish software development laboratories in the country. Khan mentioned that Pakistan has been leveraging digital solutions, notably in the areas of responding to citizen concerns, enhancing business processes, and improving operational efficiencies. Meanwhile, the efforts of the Pakistani government in focusing more on digital transformation were recognised by SAP CEO Christian Klein. Expressing appreciation for these endeavours, Klein emphasised the company’s commitment to shaping young software engineers through training and education. In an earlier statement, he hoped that this new generation of engineers will be advantageous to several IT development projects in the country.

The Contribution of SAP in IT Sector Development

Meanwhile, SAP Pakistan MD Saquib Ahmad believes the country’s IT sector should have a five-year relief package. Calling for a simplification of the tax regime for the industry, Ahmad added that the government’s special tax relief program was “an encouraging decision” that would aid in increasing the country’s export revenue. Despite this, he stated that because of inconsistencies in tax regulations, IT investors and specialists expressed confusion and are now looking for uniformity in the system.

Sharing more about the role of SAP in the IT industry, he explained that the private sector in Pakistan — including textile, food, agriculture, telecommunications, healthcare, and fashion sectors — is progressively embracing digital transformation to meet the needs of organisations in an ever-changing business environment today. According to the SAP Head, a cloud-first approach, which involves the usage of a cloud product rather than developing a non-cloud-based solution, supports enterprises in saving costs and improving scalability, while also minimising errors and allowing for more standardisation and collaboration.

“The next era of computing will be defined by intelligent enterprises. Organisations need to cut through the hype and be more useful and efficient to be an intelligent enterprise to make the world run better using emerging technologies,” he highlighted.

Additionally, Ahmad indicated that SAP was already experiencing significant success in its close cooperation with Pakistan’s digital leaders and that the company was actively working to eventually realise the “Digital Pakistan” goals. This is done by continuing to promote youth skills development and training in partnership with several major universities, he added.

“Going forward, SAP’s plan for 2022 is to tap on other industries to help them optimise costs, efficiency, and customer experiences,” the SAP Pakistan MD concluded.

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