AI is core to our solution design, not just an experiment

In a conversation with CRN India, Nitish Agrawal, Chief Partner Officer – SAP Indian Subcontinent shares how SAP is aligning its strategies with the dynamic needs of a cloud-first, AI-enabled world. He speaks about their emphasis on affordable, AI-based solutions tailored to companies of any size and how their new pricing structures are designed to bring cloud solutions within reach, even for small businesses. He also speaks about the partner ecosystem’s vital role in delivering customer success.

Nitish highlights that AI is no longer an experiment but is central to the way in which the company designs its solutions. He speaks about how SAP embeds AI throughout its products to automate business processes, improve decision-making, and drive operational efficiency. He also discusses SAP’s priorities for the future, such as the move to AI-first design, and the way in which the company aims to continue its leadership in this area.

In times ahead, how do you see your collaboration with niche and industry specialist partners furthering your vision of inclusive and accessible AI for even the smallest businesses in India? Additionally, with the new solutions and certifications coming into play, there seems to be some change in the commercial aspect. Is there any impact on the business, and are existing partners providing feedback regarding any challenges customers may be facing with the new commercial models?

I would like to answer this in two parts. On the commercial model, the world of cloud is fundamentally different from traditional on-premises models. Cloud pricing is more transparent and based on a cost-plus approach, which means customers can better understand the building blocks that contribute to the cost of any product. This transparency reduces information asymmetry, leading to better efficiency across enterprise sales and the partner ecosystem.

For our partners, we have introduced several incentive schemes including CC Flex Commission. Our partners are incentivised not just for the sale but also for the adoption and consumption of our cloud solutions, which ensures customers are realising value. This model encourages partners to ensure the solutions are properly implemented and that there is continued engagement throughout the lifecycle.

Regarding feedback from our partner ecosystem, we have received positive responses, as the financial incentives we have put in place have energised the ecosystem. Partners are now more driven to ensure the successful implementation and ongoing usage of our solutions, which has led to a more vibrant and sustainable ecosystem.

For customers, the new approach has empowered CFOs and CEOs with more information, allowing them to make better decisions regarding contract renewals. The transparency in the pricing model ensures they continue to see value in our solutions, all supported by our partner ecosystem.

Has there been any specific feedback from partners regarding challenges faced during this transition period?

Yes, we’ve had some initial feedback, primarily related to understanding the new cloud pricing models. However, our partners have been very proactive in working with us and SAP to better communicate the value of the solutions. We’ve seen a significant improvement in clarity and a stronger relationship because of this collaboration.

SAP plays a crucial role in many enterprise businesses, particularly with SAP S/4 HANA RISE with SAP and other solutions. However, a drastic change in commercials can potentially make solutions unaffordable for some organisations. How do you handle such transitions or changes in pricing, and how do you retain customers in the face of this challenge?
From my experience speaking with customers in India, the feedback regarding SAP’s pricing models has been overwhelmingly positive. What has surprised us is how competitively positioned we are in the market, particularly when compared to the price sensitivity in the Indian context.

We have unlocked new market segments who now consider SAP solutions more than in the past due to price barriers. Our modular approach to cloud ERP pricing has made it possible for businesses of various sizes, including smaller ones, to adopt SAP solutions. This has led to a significant increase in our customer base, even in traditionally underserved markets.

With everything changing rapidly, how do you ensure that SAP’s solutions remain relevant and accessible to the smallest businesses, especially in India’s fast-evolving market?

The market dynamics in India are indeed evolving quickly, and we recognise that the needs of our customers are also changing. We understand the importance of delivering accessible, flexible, and scalable solutions to cater to businesses of all sizes, including the smallest.

Our focus is on ensuring that every customer who signs on with SAP gets the value they expect. We operate under the philosophy that once a contract is signed, the clock starts ticking, and we’re committed to delivering value from the very beginning.

SAP and our partner ecosystem are driven by a customer-first approach, and while no company is perfect, we have made significant progress, particularly in the Indian subcontinent. India is now the largest market unit for SAP’s growth business, which is a very promising sign for our future in this region.

Agentic AI is gaining traction as a game-changer in enterprise software. Could you elaborate on how SAP is integrating Agentic AI into the Business Suite to deliver more intelligent and autonomous business processes?
Agentic AI is indeed a game-changer, and it’s something we’ve been very focused on integrating into the SAP Business Suite. The purpose of integrating Agentic AI is to move beyond traditional decision support and offer intelligent, autonomous processes that can make decisions on behalf of the business, significantly reducing human intervention.

In SAP, Agentic AI isn’t just about making the system smarter; it’s about creating a system that can evolve autonomously based on business context and changing requirements. For example, in supply chain management, our solutions can now autonomously predict disruptions and take corrective actions without requiring manual input.

This capability is about enabling businesses to become more agile, responsive, and efficient, while also reducing the operational overhead. It’s a significant leap forward in delivering real-time, data-driven intelligence that can steer businesses toward their strategic objectives with minimal friction.

SAP’s ‘Partner Led’ business model plays a central role in expanding AI adoption. How is your partner ecosystem accelerating AI-driven innovation across key industries in India?

The ‘Partner Led’ business model is one of the key drivers of our AI expansion in India. We believe that our partners play an integral role in making sure AI adoption is widespread across key industries. Through this model, we’re empowering our partners with the tools and resources to build AI-driven solutions tailored to their customer’s needs.

In industries like manufacturing, retail, and logistics, our partners have been able to create custom AI solutions using SAP’s AI capabilities. These solutions are helping businesses automate critical processes, gain deeper insights from their data, and ultimately drive growth. It’s our partners who are able to bridge the gap between SAP’s innovations and the specific needs of industries in India, enabling faster adoption of AI-driven solutions.

The ‘Partner Led’ model ensures that innovation is not only driven from SAP’s side but also tailored to the local market needs, creating a truly localised, AI-driven ecosystem across industries.

The ‘Partner Led Territory’ initiative is designed to empower partners with end-to-end customer ownership. How is this model helping drive stronger customer engagement and midmarket growth?

The ‘Partner Led Territory’ initiative is crucial to SAP’s growth strategy, especially in the midmarket. This model empowers partners to take ownership of the entire customer lifecycle—from pre-sales and solution design to post-implementation support and customer success. By allowing our partners to drive the engagement, we’re fostering deeper relationships with customers and improving the overall experience.

What’s exciting is that it’s helping our midmarket customers engage more deeply with SAP’s products. Partners now have more flexibility and responsibility to offer tailored solutions, which resonates very well with midmarket businesses looking for solutions that are both customisable and scalable.

This model has driven stronger customer engagement because partners are more invested in the long-term success of their customers. It’s all about shared success and helping businesses grow with SAP, and it’s accelerating the adoption of SAP solutions across industries, especially in regions that were traditionally harder to penetrate.

Looking ahead, how do you see SAP’s collaborations with niche and industry-specialist partners furthering your vision of inclusive and accessible AI for even the smallest businesses in India?

Our collaborations with niche and industry-specialist partners are crucial for making AI more accessible and inclusive for all businesses, regardless of size. India is home to a vast number of small and medium enterprises, and our goal is to take AI to business of all sizes not just to large enterprises.

These collaborations allow us to build industry-specific AI solutions that are affordable, scalable, and easy to implement. By working closely with these specialised partners, we’re able to develop solutions that solve specific pain points across industries such as agriculture, retail, and healthcare. These tailored solutions are key to making AI accessible to even the smallest businesses in India, helping them drive efficiency, automation, and growth.

The ability to collaborate with partners who understand the intricacies of specific industries gives us a unique advantage in delivering AI-driven innovations that address real, everyday challenges faced by Indian businesses.