Manufacturing Executive - January/February 2009 - (Page 35) Q&A Q: What do you anticipate will be the key business drivers shaping the markets over the next five to 10 years? You have talked a lot about business transformation, agility, and flexibility. Do you see these things continuing or do you see something new on the horizon that may cause us to rethink how we do things? A : No, because we have never said that agility is replacing things. I think if you follow our message, it’s always been about adding capabilities. So, we came from efficiency and compliance and added flexibility, and finally we said agility is also the link between strategy and execution. If you look at what’s happening these days, you’ll see how important that is. You have to anticipate in a networked world that the crisis we’re having today will happen more. It's the nature of those complex systems. That means you have to make or be able to make radical transformations and changes without going out of business, to put it very bluntly. Q: Will business be able to continually move faster or will there be a disconnect between what systems can do and what people can do? A : That’s a good question. We wrote a book some time ago about business models in 2010, and we said that IT can help to amplify intelligence. In business, you have the organizational intelligence, which is more or less the processes, the brain of the people, the DNA of the organization. We felt IT cannot replace it but can more or less amplify it to get information quicker. You can get better information, even exceptional information. I still believe that, but I would agree if we come to this fast-moving world with no buffers, no inventory any longer, we as human beings have to adjust our behaviour a little bit to such a system, which I think is missing. So I would not say it’s the speed of our brains and thinking. It more might be cultural and behaviour aspects. Q: How do you see the shape of the software industry in the next five to 10 years? Is it going to be a classic three-major-player market, with the rest very small companies? Or do you see some other model emerging? Q: The barriers to entry are too high? A : The barriers would get larger and larger. It doesn’t mean the barriers of entry for very innovative add-ons might be too high. That's the point. That’s why I said many, many smaller companies. If somebody is extremely smart, he might have enough money to enter. He cannot do it overnight. So, money alone is not the point. The point is also time. You ask about five years. From that point of were “Wenearly able to partner or with everybody, large small. We have to learn to partner with even large companies. Customers expect it. We have to also help smaller ones to come up.“ view, I think, you will see more stability in the backbone, in the core, and there might be more fluidity around it. You could say it's a combination of industrialisation and consumerisation. So, in the backbone, it's very industrialised and very reliable but when it comes to the end consumer, the end user, there's more proliferation. You need different types of suppliers. You need interconnectivity. As long as the players in the market have a similar view on that, I think that is a good way for cooperation. Q: Is there actually cooperation? A : I think if you follow us, you see that we were able to partner with nearly everybody, large or small. We have to learn to partner with even large companies. Customers expect it. We have to also help smaller ones to come up. Q: Do you think the consolidation in the industry is pretty much at the end of the cycle at this point? A : There are a few areas where consolidation is still happening, but it’s more or less coming to an end. Q: Have customers benefited from the consolidation or has it largely been a supply-side phenomenon? A : With scale, I think there is always some benefit for Manufacturing JAN/FEB-09 Executive A : I’m still believing in this model of a few large ones and many, many small ones because I cannot see today — and this might be because of my limited imagination — that somebody can very quickly build up an infrastructure like the last players have done. I always think about how long it would take me to redo, even if I have enough capacity, the SAP business suite, not only with all the functions, but with all the quality, and how long it would take to get it to maturity. 35
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