We have been tracking SAP with interest for the last several years in its efforts around its commodity management solution. To that end, we recently had another briefing with Anja Strothkaemper who is VP SAP Agribusiness and VP Commodity Management. Her briefing was very upbeat, and she told us that SAP now has more than 150 customers for its commodity management offering, having won more than 30 additional customers over 2018 for the solution. These included leading companies in agribusiness, oil and mining & metals involved in activities from exploration to processing and consumption. Indeed, through the grapevine, ComTech has heard of some very significant wins for SAP in 2018, including a major US oil company and a world-leading enterprise in agricultural processing.
Ms. Strothkaemper also told us that it managed the first successful customer migration from SAP Commodity Management on Business Suite to SAP Commodity Management on SAP S/4HANA recently. SAP clearly sees the adoption of the SAP S/4HANA suite as a strategic initiative and is expecting the majority of license revenue and upcoming customer projects to on this platform, she told us. She clearly believes that the SAP HANA database is a key advantage for the vendor with its “in-memory capabilities, SAP Cloud Analytics, SAP Digital Boardroom accessing real-time operational data and presenting in an intuitive easy to consume way on various devices – from multi large screen boardroom to tablets and obviously laptops – in conjunction with ERP standard commercial, financial and operational data is very well perceived by CxOs (specifically CFO).”
To keep the solution moving in the right direction from a functional perspective, “SAP also works with industry leaders in co-innovation engagements for agricultural trading, the blockchain, and other innovation topics and continues to deliver additional functionality on the SAP S/4HANA suite.” It has a well-defined product roadmap and during 2018, it delivered a number of significant enhancements that include, for example, the following,
- newly designed deal capture screens with draft concept and templates – traders can enter deals themselves rather than handing off to someone else,
- closing the loop for e2e processes: Derivative order management with open connection to broker systems, triggered manually or from one or multitude of physical contracts / orders as hedge request,
- many agri -specific business process enhancements and simplification, e.g. diversions without full reversals, fee handling, etc., and
- commodity pricing interfaces allowing customers to share data with their business partners (in agri – mainly farmers) via EDI, or via SAP or non-SAP portals or cloud platforms.
The SAP S/4HANA suite provides the ability for real-time reporting and many of the solutions key risk reports have been migrated to provide this capability via the in-memory database.
SAP had “strengthened its position to be the only vendor having CTRM and ERP natively integrated within one system,” she told us. SAP Commodity Management will be in the soon to be released ComTech 2019 Sourcebook for the first time this year reflecting its growing market penetration and importance as a CM solution.