The Guy That Created SAP’s Hottest Product Ever Thinks It Will Clobber Oracle

SAP executive Dr. Vishal Sikka
SAP executive Dr. Vishal Sikka

[credit provider=”SAP. Used by permisson.”]

The engineer who brought SAP’s new database into the world says that it has become the company’s most important new product of all time.The HANA database has booked sales of more than $200 million (€165 million) in its first six months.

That’s a small percentage of SAP’s overall revenue — earlier today, the company reported fourth quarter revenue of almost $5.9 billion (€4.5 billion), after pre-announcing a couple weeks ago that it would have its best quarter ever.

But $200 million in six months still makes HANA “by far the fastest growing product of that kind in our history … maybe the entire enterprise software history,” Vishal Sikka told Business Insider.

The success of HANA “is a particularly emotional story for me,” he says.

Three years ago, SAP founder and chairman Hasso Plattner took Sikka out to dinner and challenged him to come up with a strategy to bring some life back into SAP’s product lines.

It was a tall order. IT analyst Sergio Segal told Business Insider that besides HANA, “Not one product made by SAP (not acquired) in the last 19 years has proven a success.”

By July 2009, Sikka realised that the company’s hopes rested on building a super fast new database. It already had three databases built by three teams. In early 2010, Sikka was promoted from chief technology officer to an executive board position leading technology and innovation at SAP, and given the thumbs up to proceed.

He rolled the three teams into one and they worked like the devil. HANA went from “idea to completion in about nine months,” he recalls.

SAP has a lot riding on its new database. For one thing, it wants to squash its old nemesis Oracle.

“Oracle’s database occupies a significant share of databases in our installed base,” Sikka says. “We will focus on replacing the database, especially Oracle’s database, at our customers. This is very clear.”

Given a chance, he’s happy to rattle off the happy customers who have already yanked out their old database and replaced it with HANA.  He says that two such customers have become members of the “100,000K club” which means that HANA runs 100,000-times faster than their previous database. 

One large Japanese retailer used to need three days to process its customers rewards program. With HANA it now takes three seconds.

“The son of the owner of company runs the IT department. He was so psyched he called me,”  Sikka laughs. It actually took them longer — five hours — to calculate and verify the performance improvement numbers than it did to issue its rewards. The company can now offer its customers on-the-spot rewards while shopping in the store, based on the items loaded in the shopping cart.

SAP is also using HANA as a reason to rejigger its big, pricey and most popular products. It has begun to retrofit all of its products to work with HANA.

Next year SAP will release its flagship ERP software for HANA.

But Sikka is also clear that the company isn’t just using HANA to upsell its own customers. “The majority of sales of HANA are for non-SAP data scenarios,” he says.

In other words, it’s going after Oracle on its own turf. And Sikka can make a compelling argument.  The database is fast because it operates in memory while transactions are being recorded. It can handle highly organised traditional database data (structured data) and the sloppy stuff found in other documents (unstructured data). Plus HANA can grow super large without having performance problems.

Oracle has responded with its Exalytics appliance and a revamped version of its TimesTen database. But Sikka is pooh-poohing those products, claiming that they are complicated, limited, and can’t do analysis on the fly, in real time.

“Oracle missed the entire point,” he says.