SAP’s Investment in Cloud Services and Artificial Intelligence give the Mid-market a Competitive Edge

The Challenge Facing Mid-Market Businesses

In the face of unprecedented challenges to core business processes during the pandemic, the middle market forecasts promising growth in 2023. Unfortunately, this optimism appears to be matched with headwinds from emerging challenges like increasing supply chain complexity and talent management (Farren, 2023). Despite such challenges, the National Center of the Middle Market’s year-end presentation disclosed that over 70% of businesses report better performance than last year (Farren, 2023).

Figure 1: Managing Director of the National Center of the Middle Market, Doug Farren’s Middle Market Update on Business Performance in the Year-End 2022 Presentation.

Source: (Farren, 2023)

Mid-market companies are essential to the economy for two reasons. First, they represent 1/3 of private sector GDP and employment while only accounting for 3% of all businesses. Second, a 31-year average lifespan proves their ability to adapt and respond to change (Farren & Makhija, 2021). Combining these two points makes it easy to see why Rainer Zinow, SAP’s SVP of Product Management for the MidMarket, is so excited to serve this group of customers.

During a recent live event, Zinow reflected that companies like SAP and VistaVu could further enhance the competitiveness of midmarket organizations.

For example, mid-market companies often outgrow their data management systems which make it difficult to scale. Zinow referred to as “Excel hell” (VistaVu Solutions, 2023). This issue extends beyond relying on spreadsheets and QuickBooks to multiple, disconnected information systems. Zinow noted he gets excited about designing products and software integrations that can fill in gaps and simplify day-to-day operations IT support (VistaVu Solutions, 2023).

Rainer reflected that “the uncharted territory is mid-markets, and that’s where I really want to be.” Organizations serving the midmarket, like SAP and VistaVu, must keep pace with the needs of their customers. What mattered yesterday might not be the same as what matters today. Today, what matters most are the operational efficiencies of core businesses process.

Figure 2: National Center for The Middle Market projected Key Challenges and Issues as reported by U.S. mid-market leaders in the Year-End 2022 Summary.

Source: (National Center for The Middle Market, 2023)

Cloud-based ERP systems can help mid-market companies core business issues and talent management by accelerating the path to digital transformation. Zinow, pointed out that SAP’s global customer base means that many of their products were built for a global customer base. This means North American companies using a cloud product can easily access real-time international currency exchanges and streamline their financial processes.

Regarding customer-centred design, Zinow shared his thoughts about developing SAP products. Zinow acknowledged that business leaders prioritize a “robust spine” that will allow their organizations to grow on a stable and reliable platform while at the same time incorporating innovations like artificial intelligence and machine learning. He added that his responsibility is “to sense what is possible with emerging technology such as Chat GPT, and then translate it into something consumable” in direct reference to automation. Customers want a technological design that as Zinow explains, “comes with all of the processes you need, and you don’t need to know how to wire them up” (VistaVu Solutions, 2023).

While demand for cloud-based products with embedded features like international exchange rates and machine learning cockpits, it’s also important to truly understand the specific needs of each customer. Zinow commented that the complexity of each industry has to play a role in designing the overall ERP “ecosystem”. He commented, “it starts with understanding what the customer needs, and that should derive how the products should look” (VistaVu Solutions, 2023).

By combining cutting-edge innovations like built-in machine learning cockpits with a robust, stable and reliable spine, SAP democratizes otherwise out-of-reach technology for midmarket organizations.

The Opportunity for Us All

Without a doubt, the business world is constantly changing. B2B companies serving the midmarket must keep in step with their customer needs to help maintain their relevance and competitiveness. As a value-added reseller (VARs) and system integrator of new technology, VistaVu’s mission is to help our customers enhance their potential and RUN GREAT.

Tune in to Episode 3 of The Vu to learn more about how SAP is positioning itself within mid-market through product management and enhancing customer opportunities through technology.