Early on January 27, big-time ERP software company, SAP, announced its intention to acquire Signavio – a global player in the business process management space. As news spread across the industry, many had questions about what this merger actually means. Let’s break it down.

Who is Signavio?

Headquartered in Berlin and Silicon Valley, Signavio deals in business intelligence and decision management. At a high level, they developed a platform that allows companies to get real-time data from their businesses and use this data to fine-tune their process strategies and decisions. As a growing player in the process mining market, Signavio managed to collect several A-list partnerships, including Coca-Cola, Veritas, and their future acquirer SAP. The deal is rumored to have cost SAP around $1 Billion. So what is SAP getting out of this deal? You may be surprised.

What’s in it for SAP?

As we’ve mentioned before, SAP S/4 Hana is an ERP solution that’s been evolving since 2011 when SAP first introduced the Hana platform. What makes SAP S/4 Hana a standout in the market is its focus on predictive analytics and business intelligence. An example of this is S/4 Hana accounts payment processing. Instead of having a human physically review every invoice, S/4 Hana uses advanced machine learning technologies to automatically process payments using predictive analytics. Only anomalies flagged by the ERP system require a review by an actual person. Smart processes like these can save businesses thousands of dollars. However, SAP is having trouble convincing customers to upgrade their ERP systems and make the switch to its feature-loaded cloud ERP offerings.

That’s where Signavio comes in. By incorporating Signavio’s inefficiency detection technology, SAP is hoping to tempt more customers over to S/4 Hana. Signavio offers SAP customers a map in a world where their ERP landscapes are getting more customized, sprawling, and complex. One way they help companies navigate their ERP setup is called process mining. The Signavio platform lets organizations compare process models with real-time output data to see where inefficiency really hides. In the end, SAP wants customers to migrate to S/4 Hana, and now with the help of Signavio, they can ease the minds of customers who are worried about investing in an ERP system that’s customized and complex. With one acquisition, SAP can now offer Signavio’s help to ease the transition and help companies get to know and streamline their ERP systems.

What should you consider moving forward?

This is by far the most aggressive move by Christian Klein since his appointment as sole CEO of SAP in 2020. This acquisition shows Klein’s dedication to reshaping SAP as a whole. If you’re already a customer of SAP, this acquisition is nothing but a sweet bonus. You’ll not only get new tools to fight inefficiency but also a confidence boost as well, knowing that SAP is making an honest effort to enhance their cloud-native implementations. And if you’re still implementing ECC, this deal could persuade you to finally make the move to S/4 Hana.

If you aren’t an SAP customer, this gives you more to think about when shopping for your ideal ERP partner. As always, you should look for resources that come from third-party sources and go into the nitty-gritty details when it comes to comparing ERP providers like Oracle, SAP, Microsoft, and more.

If you have any questions about SAP, the cloud, or anything in the ERP realm, don’t hesitate to shoot me an email. My virtual office door is always open and I’d love to discuss your vision, your business challenges, or the latest news from around the industry.

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