IT Supplier News, Insight, and Market Intelligence.
Q4 is quickly coming to a close and some of your most strategic suppliers are at their fiscal year-end December 31st. This is typically crunch time for them and will be flat out with their customers getting as much new revenue and closed renewals before fiscal year- end.
In this edition, we summarize their biggest reported customer issues, revenue trend (hint: they are all doing fine), and our own articles and tools to learn more about how to deal with each of them:
SAP - Amazon - GCP - IBM - ServiceNow
Prevalent SAP Reported Issues:
In 2024, SAP customers have voiced several key complaints, primarily centered around the complexity and cost of transitioning to SAP S/4HANA and the cloud (as has been the case for many years). One major issue is the cost and resource burden associated with migrating from legacy systems, which includes high consulting fees and the need for extensive staff training. This has been a concern as businesses prepare for the 2027 end of support for SAP ECC.
Another common complaint is around integration challenges. As companies adopt more digital tools and move towards cloud-based solutions, integrating SAP with non-SAP systems has become increasingly complicated. This issue is particularly pronounced in merger and acquisition scenarios, where different ERP systems need to be consolidated
Additionally, security and compliance concerns persist, particularly as more organizations shift to cloud environments. Many companies are cautious about the potential risks of moving sensitive data to the cloud, despite SAP's push towards cloud-first strategies like "RISE with SAP"
Finally, there is also frustration with the pace of innovation and the challenge of keeping staff upskilled. Companies are finding it difficult to align internal talent with rapidly evolving SAP technologies, such as AI and machine learning, leading to increased demand for external support and training
These challenges have prompted SAP customers to call for clearer guidance, better support, and more cost-effective migration paths to future-proof their operations.
Security and Data Protection: Customers worry about data safety with generative AI. AWS addresses this with encryption and privacy controls via Amazon Bedrock and AWS Nitro System, though managing security in complex AI setups is still challenging.
Cost Management: AWS customers frequently report difficulties in managing and optimizing cloud costs. The complexity of pricing models and the need for better cost governance tools continue to be significant pain points.
GCP Issues:
GCP customers are keen on generative AI but struggle with data management and finding skilled professionals, while ensuring safe and responsible AI adoption remains crucial.
GCP is favored for experimentation, but cost control challenges arise as projects scale, particularly for smaller or new cloud users.
Both platforms are investing heavily in AI and cybersecurity to address these concerns, with AWS introducing tools for natural language queries in security analysis and GCP focusing on expanding partner support and AI-driven business transformations.
AWS revenue:
2019: AWS generated approximately $35 billion.
2020: Revenue rose to $45 billion.
2021: It crossed the $62 billion mark.
2022: AWS reached about $80 billion in annual revenue.
2023: Revenue grew to $85 billion.
2024 (Projected): AWS is on track to achieve a $100 billion run rate by the end of the year
GCP Revenue:
2019: $8.9 billion
2020: $13 billion, a 46% increase
2021: $19.2 billion, a 48% increase
2022: $26.3 billion, a 37% increase
2023: Approximately $36.8 billion annual run rate by Q4, reflecting a 26% year-over-year increase.
Data Breach Challenges: IBM's 2024 report reveals growing data breach concerns, with incidents in public and private clouds. These costly breaches are prolonged by limited data visibility, worsened by intellectual property theft and stolen credentials.
Security Staffing Shortages: Organizations using IBM's security services struggle with staffing, increasing breach management costs. This drives AI and automation adoption, though concerns about new AI vulnerabilities persist.
Generative AI Risks: As generative AI adoption accelerates, customers worry about data security and ethics. Despite its efficiency, it increases vulnerabilities, requiring enhanced security measures.
Customer Experience Issues: IBM's omnichannel support highlights engagement gaps. Customers seek seamless support across social media, live chat, and self-service platforms, essential for boosting satisfaction and loyalty.
These issues are prompting IBM to emphasize AI-driven security measures, increase security budgets, and enhance customer engagement strategies.
Implementation Complexity: ServiceNow's features can make initial setup and customization challenging, especially when adding new modules like Finance and Supply Chain.
AI and Automation Challenges: While ServiceNow is progressing in AI, users face difficulties in maximizing these tools due to limited AI maturity or integration issues in complex settings.
Navigating the User Interface: While improvements have been made, some users still encounter challenges with certain aspects of the platform's intuitiveness, particularly non-technical team members, which can affect how quickly they embrace the system and its overall efficiency.
Budget Optimization: As ServiceNow broadens its suite of solutions, a few customers have voiced reservations about the increasing expenses tied to licensing and cutting-edge features such as AI-powered automation.
Looking ahead to 2025, ServiceNow is seeks to drive it's AI capabilities, refining self-service workflows, and venture into areas like supply chain and finance.
