SAP acquired Silicon Valley-based Taulia in March of 2022. Three years on, the fintech is helping customers unlock liquidity, and save big on costs as a result. Thomas Mehlkopf explains how.

The SAP Taulia portfolio offers solutions for working capital management and supply chain financing, as well as a network for buyers, suppliers, and financial institutions.

Mehlkopf is global chief revenue officer for Treasury and Working Capital Management at SAP, and is responsible for marketing and rolling out the solutions for these domains to customers.

Q: Three years ago, we announced that the Taulia products would be integrated into the SAP portfolio. What’s the status?

A: After acquiring Taulia, we pushed ahead with three main priorities to align with SAP Business Suite. The first was the integration of the portfolio into SAP Business Network so that, where suppliers and buyers both run SAP Taulia solutions, they can utilize the network to benefit from early payment options and supply chain finance.

We also worked on integrating the solutions into SAP S/4HANA Cloud Public Edition and released the SAP Taulia solutions for receivables financing and payables financing on SAP Cloud ERP in February 2025. These are particularly relevant for small and midsize enterprises that want to grow and that need quicker payments to do so. The current focus is on the U.S., Canada, UK, DACH, and Singapore markets, with the goal of making this functionality available in additional countries soon.

Our third priority was to embed SAP Taulia Virtual Cards into SAP Ariba solutions. The cards enable buyers to pay their suppliers sooner — even before they issue an invoice — using a “pay on purchase order” transaction. This ensures that the supplier in question has sufficient cash flow to fulfill the order.

Back in 2022, Taulia was described as a growth opportunity for SAP and for customers. Could you tell us how SAP Taulia is performing?

SAP Taulia already has several customers that finance billions through the platform, thereby improving both their own liquidity and that of their suppliers. My team’s objective is to increase that number and to continue scaling up, and we’re making good progress. Over the last three years, the volume of transactions processed with SAP Taulia has risen steadily from US$500 billion to US$800 billion.

Customers are benefiting from this progress: one large enterprise in the oil and gas industry saved almost €700,000 within a single month of going live. Extrapolated to a full year, that’s annual savings of almost €8 million. So, the business case for customers is definitely there.

You presented the first AI use case in SAP Taulia at SAP Sapphire in 2025. Can you tell us about its value for customers?

The AI use case relates to our “insight to action” approach and helps companies plan and improve their cash flow. SAP Taulia has already been using artificial intelligence for some time to forecast supplier behavior around early payments. By combining this insight with data from an app on SAP Business Technology Platform that provides transparency on free cash flow, the AI use case will give customers tips on how to improve their liquidity. It also runs through various scenarios showing them ways to influence it. Information like this is especially important for CFOs — never more so than in times of uncertainty.

Are there any other recent announcements you would like to share?

Yes, another important update is that SAP Taulia is now part of SAP’s cloud ERP packages for the public cloud, SAP Finance Base and SAP Finance Premium, as well as the private cloud, SAP Cloud ERP Private. This means that we can quickly show customers the positive business case for their transformation of using SAP Taulia to improve their cash flow and achieve savings.

In times of global crisis, trade tariffs, and supply chain disruption, why are the SAP Taulia solutions so vital for cash flow?

Cash is still king, especially in a crisis. An article published recently in German business newspaper Handelsblatt reported that net debt among the 40 companies on Germany’s DAX stock market index has increased eight percent to €227 billion since the pandemic. Clearly, financing is a major issue, particularly given that interest rates have risen so sharply. Many companies borrowed when interest rates were low and are now having to refinance their loans at higher interest rates, which puts enormous pressure on their finance teams. SAP Taulia solutions can help by providing the funding that businesses need.

Given the impact that trade tariffs have on the supply chain, it is vital that companies carry out liquidity planning and scenario analysis. They need to think about where they will manufacture their products in the future, what effect that choice will have on revenues, and how they can use SAP Taulia to improve their cash flow.

Which reference customers are already benefiting from this?

SAP Taulia customers include Henkel, Airbus, Nissan, AstraZeneca, Kimberly-Clark, and Bridgestone.

One customer has enabled early payments to suppliers totaling over €5 billion since the start of the program, which has led to an improvement in cash flow of more than €1 billion during this period.

Your pledge is “to create the future of finance together.” What does that involve?

We want to team up with our partners and customers to influence the transformation of corporate finance. That includes working with banks and implementation partners and integrating SAP Taulia into a swathe of SAP solutions. Together, we offer customers a comprehensive portfolio of treasury and working capital solutions, ranging from payments and cash management to financial risk management.

One key aspect of our road map is our treasury and payment portfolio, which covers topics such as the future of payments. We are also working to integrate new technologies, including blockchain and digital currencies, so that we can offer our customers innovative payment and financing solutions.

Based on a long-term relationship with SAP AppHaus Network partner Bluestonex, renowned luxury retailer the Watches of Switzerland Group moved to SAP Business Technology Platform (SAP BTP) in a partner-managed cloud approach to fully enable application development and digital innovation.

With the help of its trusted partner, the Watches of Switzerland Group also set up SAP Integration Suite within only two weeks, enabling the company to incorporate insurance offers in their processes.

The Watches of Switzerland Group is a leading luxury watch retailer with a reputation for quality and exclusivity. With operations spanning the UK, U.S., and parts of Europe, its portfolio of brands has been a trusted name in luxury timepieces for decades. As the company expands its business and adapts to new market dynamics, Watches of Switzerland Group is transforming its technology infrastructure to prioritize scalability, efficiency, and streamlined operations across its global presence.

The journey to SAP BTP as a partner-managed cloud model

At the beginning of the engagement, the English watch retailer relied on an enterprise architecture including legacy systems such as on-premise SAP ECC 6.0 systems and middleware built in-house. Limited IT resources made scaling difficult to meet business demands for faster project delivery and modern integrations.

After purchasing SAP BTP credits, the company faced internal skill gaps and competing priorities. Finally, the company wanted to adopt cloud-based technologies while remaining flexible about future ERP decisions, whether transitioning to SAP S/4HANA or exploring alternative platforms.

Partnering with Bluestonex

Watches of Switzerland partnered with Bluestonex and transitioned to a partner-managed cloud model – in this case SAP BTP. Under this model, Bluestonex took over responsibility for managing SAP BTP credits, resource allocation, and infrastructure support, allowing Watches of Switzerland Group to shift from an internal, self-managed approach to an expertly managed environment, always aligned with the retailer’s business objectives. Since moving to this model, Watches of Switzerland Group has:

• Increased SAP BTP value: Freed from managing credits and technical configurations, the customer team can focus on business-critical projects
• Streamlined SAP Fiori applications: All SAP Fiori apps have been successfully migrated to the cloud, enhancing performance and improving the user experience
• Strengthened IT resilience: With Bluestonex acting as a strategic partner, Watches of Switzerland has built a foundation to support future growth and innovation
• Future-proofed infrastructure: The agnostic capabilities of SAP BTP ensure that the integration framework remains relevant, regardless of the future ERP platform

Bluestonex Innovation Factory

With the foundational work completed, Watches of Switzerland decided to further expand its adoption of SAP BTP services, integrating more business processes and scaling globally. But what were the core business processes? Where was the room or even need for improvement to deliver best-in-class customer services, be successful overall, and remain on top of things in the luxury retail segment?

“The partnership with Bluestonex is not just about technology,” said Glenn Bamford, head of Business Systems at Watches of Switzerland Group. “They act as an extension of our team, bringing innovation and expertise that we lack internally. With their support, we’ve been able to make strategic moves towards modernizing our systems while remaining agile for the future.”

To understand business, user, and customer needs, thorough research can provide reliable answers and a solid foundation for innovation. So, along the human-centered approach to innovation, Bluestonex Innovation Factory team organized a user research journey visiting six representative Watches of Switzerland Group showrooms, shadowing employees and observing different processes in the context of purchasing, customer inquiries, deliveries, commissioning, and many more.

After visiting the different showrooms, one observation was that requirements could vary considerably from one to another, simply because of different locations and customer profiles. In some showrooms, it was mainly about selling middle-priced watches and attending several customers at a time; in others, it was about serving one customer with specific needs for a purchase of a very expensive and unique piece.

Incorporating insurance options with the help of SAP Integration Suite

Despite all the differences, there is one requirement the researchers observed, that spanned across all customer engagements. That is the wish for an appropriate insurance option for the purchased watch. The Watches of Switzerland Group and Bluestonex decided to realize this integration of an insurance option in its service processes through SAP Integration Suite.

In just two weeks, the insurance integration went live as scheduled, allowing the Watches of Switzerland Group to meet crucial business demands without sacrificing quality or functionality. With SAP Integration Suite, Watches of Switzerland Group is now positioned to continue modernizing its technology stack in alignment with its strategic vision. This scalable solution can evolve with their future needs, including a potential transition to SAP S/4HANA.

“This project demonstrates the value of Bluestonex as a strategic partner,” Bamford said. “Not only did they execute the integration under intense time pressure, but they also provided critical expertise. SAP Integration Suite, deployed with Bluestonex’s support, paves the way for greater flexibility and scalability as we move forward with our digital transformation.”

During the annual SAP BTP strategy day held in the Bluestonex AppHaus Shropshire, Watches of Switzerland Group identified concrete business objectives and how technology could be harnessed to accomplish these goals, both for them and for Bluestonex as its partner. With the proven hands-on methods to prioritize and align different solutions to these goals the joint team was able to map goals to short-term and medium-term actions.

Looking back, Bluestonex Commercial Director Richard Henry said: “Our partnership with Watches of Switzerland was born from our SAP AppHaus DNA, as well as the focus on providing value-driven user experience in SAP BTP applications. As a niche SAP partner, we could provide the right skill set, along a human-centered approach to innovation and support the Watches of Switzerland Group in its digital strategy with SAP.”

After realizing the value of SAP Integration Suite, Watches of Switzerland Group and Bluestonex are now looking for further integration projects right across the business. The group’s flexible and secure cloud-first approach enables it to adapt to changing markets and continue to deliver the best possible customer service.

The way ahead

One area where both teams are equally eager to progress is in artificial intelligence (AI). The Bluestonex team always looks for business use cases that could be improved with the help of SAP Business AI capabilities. Also, the Watches of Switzerland Group’s team is keen to understand how to unlock the use of AI in its organization. Bluestonex showcased several solutions, including its document processes application, which was developed as part of the Next Level Programme in just 10 days, as well as the integration of SAP’s generative AI copilot Joule for its flagship product Maextro, a data governance tool.

For all the opportunities SAP Business AI holds in stock, customer and partner are currently planning for a first SAP Business AI Explore workshop to identify use cases that could be improved with the help of AI. As said above, it is all about thorough research and a trustful collaboration to stay future-ready and a leader in luxury retail.

Imke Vierjahn is communications lead for SAP AppHaus Network.

Vendor consolidation has emerged as the dominant priority for CIOs in 2025, driven by mounting pressure to reduce complexity, control costs, and maximize the full potential of AI – while creating greater mechanisms for resiliency.

Research from multiple industry sources indicates that this isn’t just an emerging trend — the emphasis on consolidation is growing at an unrelenting pace.

According to ADAPT’s CIO Edge research, a comprehensive study of more than 140 CIOs, 68 percent of technology leaders are planning to consolidate their vendor landscape.

This trend is not just about making minor adjustments to meet market demands; a majority of organizations are targeting a 20 percent reduction in vendor count, which represents a significant and fundamental shift in how enterprises approach their technology ecosystems.

The urgency for CIOs to transform their vendor landscape is palpable across all sectors and industries. A survey of more than 1,000 technology professionals revealed that 90 percent of IT professionals identified software consolidation as a priority, with 73 percent predicting their organizations will continue growing software investments while simultaneously consolidating vendors.

This paradox — expanding capabilities while reducing complexity — defines the modern CIO’s challenge.

The false promise of best-of-breed

This vendor consolidation trend contrasts with movements like the MACH alliance, which  promotes a pure “best-of-breed” approach. While its underlying architectural approaches (Microservices, API-first, Cloud-native, Headless) are sound and arguably have become table stakes in the SaaS world, MACH created unexpected challenges for enterprises.

Initially lauded for its flexibility and agility, MACH ended up creating significant complexity — more than most enterprises can handle — at a time when they are looking for simplicity more than ever.

The economic reality is stark: fully MACH implementations usually require more money upfront compared to a unified solution that is pre-configured. Companies must consider not only the purchasing of multiple services, but also the cost and time required for employee training and adoption. Running MACH architecture requires people with highly specialized skills in cloud infrastructure, APIs, microservices, and tools designed to streamline development of the user-facing part of a website or web application. The job market for that talent is uber-competitive, even in the age of AI, meaning you’ll need to have the resources to pay them well or else your competitors will.

The hidden costs of fragmentation

Research reveals several critical drawbacks to the fragmented fully best-of-breed  approach:

• Increased complexity: Managing hundreds of microservices becomes exponentially daunting and expensive rather quickly, with system issues potentially impacting multiple services simultaneously. The management and expertise required to oversee such architectures can be daunting — and expensive. Once system issues are discovered, they could impact numerous services, which requires deep knowledge coordinated across multiple areas of expertise for troubleshooting and debugging. This can make resolution complicated and cost prohibitive.
• Integration challenges: Trying to make connections between services and systems that were not designed to work together requires additional development expertise, which is expensive.  Incompatibilities between functions like search, customer service, catalog management, and OMS can lead to degraded customer experience and loss of loyalty.
• Security concerns: The beauty of MACH architecture is also the beast: all of the composable microservices, APIs, and cloud offerings represent security risks. Comprehensive security requires consistent implementation across all components, which can be challenging when using solutions from different vendors. Businesses must develop robust security frameworks and governance models to ensure protection across their entire MACH ecosystem.
• Vendor management complexity: Best-of-breed usually means working with dozens of vendors rather than a few, which can add vast complexity to development and customer support depending on the long-term viability of each vendor, which must provide critical functionality for services or tools that could be discontinued or significantly changed in the future.

The strategic advantage of unified platforms

As CIOs prioritize vendor consolidation, SAP’s approach to “Suite as a Service” or “best of breed as a suite” offers a pragmatic solution that addresses the fundamental challenges of fragmented architectures. Rather than forcing organizations to choose between flexibility and integration, the SAP Customer Experience (SAP CX) portfolio provides both through a unified yet composable business suite that spans front and back-office operations, in conjunction with a pre-integrated and certified rich ISV ecosystem that allows businesses to compose with intention, wherever this makes sense business-wise.

The flywheel effect: applications, data, AI

The true power of consolidated platforms lies in what SAP calls the “flywheel effect.” In this model, applications generate data, data trains AI, and AI optimizes applications. This creates a virtuous cycle where:

• Better data feeds better AI
• Better AI feeds better applications
• Better applications generate better data

This integrated approach is only possible when organizations move beyond siloed point solutions to embrace unified platforms that can leverage the full spectrum of business data. Companies already invested in SAP technologies have discovered that a unified data strategy provides a proven path to the data architecture that AI requires.

Quantified benefits: the economic case for consolidation

Enterprise Strategy Group’s economic analysis of SAP CX solutions reveals compelling evidence for the vendor consolidation approach:

• Operational Efficiency Gains
  • Faster time to value: Organizations can fully connect and integrate their CX and ERP data in as few as six months
  • Reduced implementation time: Companies avoid roughly 25 to 50 percent of the time and effort required to build integrations from scratch
  • Improved productivity: Depending on job function, customers report 10 to 300 percent improvement in daily productivity
• Cost Optimization
  • Lower total solution costs: While individual solutions may appear cheaper, the holistic end-to-end solution approach is far more cost-effective
  • Reduced maintenance overhead: Organizations can eliminate up to 70 percent of the time required to manage and maintain systems
  • Resource optimization: Companies avoid having to grow teams by up to 2x to support custom development and integrations
• Strategic Advantages
  • Enhanced customer experience: Seamless connectivity between customer and operational data enables superior customer service
  • Faster innovation: End-to-end visibility enables quicker, more informed decisions leading to faster product launches
  • Reduced operational risk: Standard iFlows provide more reliable connections with fewer potential connectivity issues

The AI-driven imperative

AI is driving the consolidation trend as much as the need to reduce costs. AI models demand high-quality, accurate data to be useful. When organizations maintain data silos — often the result of disconnected digital tools — AI efforts fall short of expectations or stall entirely.

SAP’s unified approach addresses this challenge directly. By providing harmonized SLAs, UX, data models, and provisioning across the stack, along with embedded AI via SAP Business AI and a unified and semantically rich data layer via SAP Business Data Cloud, organizations can fully leverage AI capabilities across domains without the complexity of integrating multiple disparate systems.

The consolidation acceleration

The trend toward vendor consolidation is accelerating across multiple dimensions:

• Seventy-five percent of organizations pursued vendor consolidation in 2022, up from 29 percent in 2020, according to Capgemini research
• Gartner predicts that by 2027, 70 percent of organizations will optimize cloud-native application vendors to a maximum of three
• For midsize companies, the average number of SaaS tools decreased 18 percent in the last two years

The path forward: strategic consolidation

The evidence is clear: 2025 marks a pivotal moment for CIOs. Organizations that embrace strategic vendor consolidation and choose unified platforms over fragmented point solutions will gain significant competitive advantages in operational efficiency, cost management, and AI readiness.

SAP CX represents the future of customer experience technology — not as a collection of disparate tools, but as a unified, intelligent platform that can adapt and evolve with business needs. As CIOs navigate the challenges of 2025, the choice between complexity and consolidation will define their success.

The question isn’t whether to consolidate; it’s whether to lead the trend or be left behind.

With 68 percent of CIOs already planning consolidation initiatives, organizations that act decisively on vendor consolidation will be best positioned to win when it comes to the future of enterprise technology.

Geert Leeman is chief revenue officer of SAP Customer Experience.

Earlier this year, SAP announced a new cloud subscription offering, SAP ERP, private edition, transition option, which is designed to help our largest and most complex customers plan and execute on their cloud transformation strategy.

Since these first announcements in February and March, we have received encouraging feedback from the SAP community.

Today, we are providing additional details about this offering to better support our customers and partners in evaluating it as part of their RISE with SAP transformation journey. We’re also pleased to share that customers that subscribe to a new instance of SAP ERP, private edition in 2025 – or have done so already – can take advantage of a special promotion for SAP ERP, private edition, transition option.

What is SAP ERP, private edition, transition option?

As part of the RISE with SAP journey, many organizations are transitioning to SAP S/4HANA Cloud Private Edition and SAP S/4HANA Cloud Public Edition to modernize their operations and stay competitive. SAP recognizes that our largest and most complex SAP ERP customers may not be able to complete this transformation by the end of extended maintenance for their installed SAP Business Suite 7 in 2030.

To support these customers, SAP has introduced SAP ERP, private edition, transition option – a time-bound subscription offering designed to provide business continuity from 2031 to 2033 while enabling a structured path to SAP Cloud ERP or SAP Cloud ERP Private.

The offering includes an SAP ERP cloud subscription for specified products – centered around SAP ERP Central Component on SAP HANA – and is combined with services designed to facilitate the transition to RISE with SAP via the max success plan (to be generally available in January 2026). It will help customers focus on the setup and optimization of their new and future system landscape. Business continuity services will cover elements like legal changes, security patches, and bug fixing. The specifics of which products are eligible are detailed in SAP Note 3591251.

Key prerequisites for adopting this offering

To take advantage of the SAP ERP, private edition, transition option, there are a few prerequisites to keep in mind:

1. Move to SAP ERP, private edition: Systems must be migrated to SAP ERP, private edition on SAP HANA before December 31, 2030.  SAP strongly recommends this move now in order to start preparing systems based on the additional prerequisites outlined below.
2. Database requirement: SAP HANA will be the only supported database for this offering.
3. System size: Minimum 2 TB for systems subscribed with SAP ERP, private edition, transition option.
4. Technical readiness: Systems must be prepared for the transition option, namely mitigation coverage for products not included in the new option. See SAP Note 3591251 for details.
5. Max success plan: The transition option is only available in combination with the max success plan during 2031-2033, including additional transformation services. This success plan will be generally available in January 2026.

Pricing and promotions

SAP ERP, private edition, transition option will be a new subscription, priced at an uplift compared to the SAP ERP, private edition pricing valid end of 2030. The detailed conditions are outlined below:

SAP is offering a special promotion for customers that commit to SAP ERP, private edition by the end of 2025 or have done so already. These early adopters will be eligible to adopt the SAP ERP, private edition, transition option in 2031 under commercially equivalent terms to their then existing subscription.

Customers that sign up for SAP ERP, private edition in 2026 will receive a standard 20 percent uplift in pricing when switching to the transition option in 2031. For those who sign up in 2027 or later, the uplift is not yet disclosed, final pricing will be communicated only closer to availability to purchase in 2028. 

In all cases above, the max success plan fee will come in addition to the respective final price of the SAP ERP, private edition, transition option.

Call to action

Now is the time to act. If your organization anticipates needing more time beyond 2030 to complete its transformation to SAP Cloud ERP or SAP Cloud ERP Private, taking the first step in 2025 is critical. Here’s why:

• Secure the 2025 promotion: Customers that sign up for SAP ERP, private edition by the end of 2025 (with a start date no later than 2026) will be eligible for a 1:1 move to the SAP ERP, private edition, transition option in 2031 — without any uplift. This provides a significant financial advantage and provides cost predictability for long-term planning.
• Gain valuable lead time to prepare your systems and teams: Moving now to SAP ERP, private edition allows your organization to address technical prerequisites – such as migrating to SAP HANA and mitigating unsupported technologies like Java – at a manageable pace. It also gives your teams time to align on transformation goals and build internal readiness.
• Reduce risk with a phased, structured transformation path: Starting now enables a smoother journey: first moving to SAP ERP, private edition, then leveraging the transition option if needed, and ultimately adopting SAP Cloud ERP or SAP Cloud ERP Private. This phased approach minimizes disruption and supports continuous business operations.
• Ensure eligibility for the transition option: The transition option will only be available to customers that have already moved their systems to SAP ERP, private edition before the end of 2030. Acting now guarantees that your organization meets this prerequisite.

For most of our customers planning to complete their transformation by 2030, this option won’t be necessary. Nevertheless, this option is tailored for those requiring additional time and support due to the complexity of their systems.

Learn more

To learn more about this offering, please refer to the following resources:

• Visit this SAP Support Portal page and SAP Note 3591251.
• Reach out to your SAP account executive or partner contact to discuss how the SAP ERP, private edition, transition option fits into your transformation strategy.
• On the future direction of the SAP Services and Support portfolio, including the max success plan to be available in January 2026, see here.

Stefan Steinle is executive vice president and head of Customer Support & Cloud Lifecycle Management at SAP.

WALLDORF and SAN FRANCISCO — SAP (NYSE: SAP) and SmartRecruiters today announced that SAP has entered into an agreement to acquire SmartRecruiters, a leading talent acquisition (TA) software provider.

SmartRecruiters’ deep expertise in high-volume recruiting, recruitment automation and AI-enabled candidate experience and engagement are considered an ideal addition to the SAP SuccessFactors human capital management (HCM) suite. The planned acquisition will strengthen SAP’s all-in-one HCM suite, so customers have the tools they need to attract and retain top talent in an increasingly competitive landscape.

SmartRecruiters’ powerful, user-friendly interfaces and seamless workflows will complement SAP’s robust HR tools – improving decision-making, reducing time-to-hire and providing a better experience for candidates. Embedded analytics and AI-driven recommendations from both companies will provide rich insights into talent pools, hiring bottlenecks and workforce planning.

“Hiring the right people is not just an HR priority – it’s a business priority. With this planned acquisition, we will help our customers attract and hire the best talent so they can advance their talent acquisition agendas with speed and agility, while lowering their total cost of ownership,” said Muhammad Alam, member of the Executive Board of SAP SE, SAP Product & Engineering. “Customers will be able to manage the entire candidate lifecycle — from sourcing and interviewing to onboarding and beyond — all in a single system to streamline the experience for recruiters, hiring managers and, in particular, candidates.”

Customers can expect enhanced and AI-enabled recruiting and hiring capabilities, making applicant tracking and candidate screening more efficient. Data-driven hiring and recruitment analytics will flow directly into SAP’s existing HCM tools, providing a single system of record and harmonized data for compliant, seamless operations. The SmartRecruiters portfolio will also continue to be available standalone for the foreseeable future.

SmartRecruiters’ Software-as-a-Service solutions and platform enable more than 4,000 organizations globally to efficiently manage their hiring workflows end-to-end, offering a compelling experience to recruiters, hiring managers and candidates.

SmartRecruiters CEO Rebecca Carr said, “SmartRecruiters’ mission has always been to make hiring easy. Joining forces with SAP presents a tremendous opportunity for enterprises worldwide to benefit from our industry-leading approach to talent acquisition. I couldn’t be more excited for the opportunity this planned acquisition presents for our customers, partners and employees as we build the future of hiring together.”

The transaction is expected to close in the fourth quarter of 2025, subject to customary closing conditions, including regulatory approvals. Terms of the transaction were not disclosed. J.P. Morgan served as exclusive financial advisor to SmartRecruiters.

Visit the SAP News Center. Get SAP news via LinkedIn and Bluesky.

About SmartRecruiters

SmartRecruiters is the Recruiting AI Company that transforms hiring for the world’s leading enterprises. Built for global scale, SmartRecruiters delivers an AI-powered hiring platform that automates and optimizes the entire talent acquisition process, ensuring faster and smarter hiring decisions. More than 4,000 organizations, including Amazon, Visa, and McDonald’s, rely on SmartRecruiters to build winning teams. For more information, visit www.smartrecruiters.com.

About SAP

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Every 57 seconds, a new car rolls off the assembly line at the BMW Group’s plant in Regensburg, Germany. But the factory does more than just build highly desirable automobiles; it is also pioneering the company’s cloud transformation to SAP S/4HANA.

Using RISE with SAP, BMW Group converted the factory’s operations to modern cloud software, which also enables greater integration of AI. The successful go-live among this complex shift operation was the result of an extraordinary team, a strategic partnership lasting more than 30 years, and seven years of co-innovation between BMW and SAP.

Creating a new standard as partners

Following the initial rollout of the new solution at BMW Group’s MINI plant in Oxford, England, the Regensburg plant is the first full-scale BMW Group facility to transition to SAP S/4HANA.

The rollout of the new cloud solution for the parts process chain (abbreviated as PKT in German) affected the entire logistical process chain for the digital control of parts supply in vehicle production — from ordering required components from suppliers, receiving, and warehousing to delivering them to the production line.

In addition to purely logistical processes, the solution also covers the plant’s quality and maintenance processes. For the first time, the new PKT template for SAP S/4HANA enabled unified management of parts supply across all production technologies required to build a vehicle.

The project’s success is rooted in a team that worked across corporate boundaries toward a shared goal. Customer Services & Delivery and Product & Engineering teams from SAP partnered with BMW to create a blueprint for holistic digital transformation in production logistics — from the press, body, and paint shops to final assembly.

Awareness of the importance of this transformation project was palpable among every SAP employee involved. “We made one thing clear to everyone on the team: every single car counts,” says Carola Schoenfelder, chief project expert, Strategic Customer Innovations at SAP, and program lead for SAP at BMW. “It wasn’t only about IT; it was about the factory, the people, and the result.”

Transformation as a staircase

Around one-third of employees at the BMW plant in Regensburg work directly with SAP S/4HANA components, including SAP Transportation Management and SAP Extended Warehouse Management. Involving those affected in the change process was critical to success. Another factor in the project’s success was learning from experience. The smaller MINI factory in Oxford had already completed its go-live, which helped guide the project team as it worked on the bigger Regensburg project.

Instead of designing the transformation as a metaphorical “rock face” that had to be climbed without any safety equipment, the team viewed it as a “staircase”: an incremental, guided transition. In addition, satellite support points were set up within the factory to offer support at any time.

Identifying optimization potential

Six months after go-live, it is clear that the transition to SAP S/4HANA Cloud Private Edition is more than just a technical upgrade; it’s noticeably changing daily operations. In particular, the new SAP Extended Warehouse Management application is proving to be a key technology that supplies important data and identifies potential for optimization.

Thanks to the new data foundation, the potential for optimization can be more precisely identified, for example, by the use of tugger trains and reduction of internal transport kilometers.

Standardization brings not only efficiency but also flexibility. Employees can switch between tasks more easily, and even between factories, because less specialized knowledge is needed. The processes are more streamlined and more transparent.

“The global digitalization of our production logistics significantly increases transparency and standardization, allowing us to respond more quickly to changes in demand or supply shortages,” explains Michael Nikolaides, head of Production Network and Logistics at the BMW Group.

Ready for an AI-driven future

Strategically, the new IT infrastructure has brought significant changes. The cloud provides speed and flexibility, without users having to worry about the technology in the background. Moreover, the introduction of standardized cloud solutions is a crucial step toward fully harnessing the potential of AI in the future. To benefit sustainably from AI, standardized software solutions that can be quickly enhanced with new capabilities are needed.

“With the next stage of digitalization in production logistics — enabled by consistent, unified data structures and standard process templates — we have significantly advanced the AI enablement of the BMW Group,” explains Alexander Buresch, CIO and senior vice president of BMW Group IT.

Over a seven-year period of co-innovation, BMW shared its automotive-specific requirements while SAP mapped large sections of these requirements in SAP S/4HANA and in the industry solution SAP S/4HANA for manufacturing logistics. “As part of our partnership with SAP, we have transferred key corporate processes to a service-oriented, cloud-based platform, achieving a new level of efficiency, quality, and automation,” Buresch says.

Those who use a shared standard can also find solutions collectively, share them, and co-develop solution designs. If other automakers configure on the same standard in the future, BMW will also benefit from new SAP releases.

The strategic collaboration to develop the PKT template began in 2018 as a project driven by deep expertise and strong commitment. The go-live in Regensburg is a key indicator that SAP S/4HANA Private Cloud can meet the complex demands of a high-volume vehicle plant. Together with BMW, the SAP consulting team demonstrated that with meticulous preparation, a lossless go-live in a complex shift operation is possible. The rollout process works and can be adapted and expanded plant by plant.

Hendrik Haas, senior vice president, general manager, and head of Customer Services & Delivery Middle and Eastern Europe at SAP, adds: “The collaboration with our lighthouse customer BMW is making waves in the market and demonstrates how digital transformation in production logistics can be successfully implemented. BMW’s Regensburg factory was an important step, with extraordinary commitment from both sides of the partnership. We will continue the RISE with SAP transformation at the main factory in Munich this summer, together with BMW.”

Top image courtesy of BMW Group.

Global geopolitical uncertainty, trade tensions, and national security concerns are fueling the debate over digital sovereignty as well as the market growth for sovereign cloud services and demand by enterprises for secure, local access to the latest AI tools.

The public cloud has ushered in unprecedented benefits for businesses and governments in terms of data access and data flows. But in uncertain geopolitical times, sensitive data — including government classified information and data generated by regulated industries — requires special protection.

As SAP CEO Christian Klein noted recently in an interview with the Financial Times, these concerns have fueled customer anxiety over cloud infrastructure choices and boosted the concept of “sovereign” data centers, where information remains within national borders.

Sovereign clouds

Historically, governments, government agencies, and a select group of private sector organizations in sensitive areas, including defense and public utilities, led the demand for sovereign clouds. Technology companies, including SAP, have responded by providing highly secure sovereign cloud services.

But in recent months the debate over digital sovereignty has widened. As Hayete Gallot, Google’s president of Customer Experience, recently noted, “Sovereignty used to be a very niche thing that applied to very regulated industries, such as defense and intelligence, and suddenly in the current environment, everybody is thinking about it.”

The EU has proposed spending €20 billion to build five “gigafactories” to facilitate digital sovereignty and help Europe compete more effectively in AI against the predominantly U.S.-based hyperscalers and large language models (LLMs). But others, including Klein, are not convinced that it makes sense to replicate the physical infrastructure built by hyperscalers and others.

The data center hardware race is over

Klein argues that spending billions in government funding in the EU on huge new data centers would be misguided, and that European companies already have control and sovereignty over their own data. “The hardware train has left [the station],” he said. Together with other senior SAP executives, he also argues that digital sovereignty is about more than physical infrastructure — the operational, technical, and legal dimensions of data sovereignty matter just as much.

Crucially, SAP Sovereign Cloud offers a model that keeps customer data within national borders and in compliance with local laws, without the need to replicate the existing physical infrastructure. Its services, developed over the past 20 years, are already provided to some of the most security-sensitive organizations in the world, including those in the U.S. through SAP National Security Services (SAP NS2).

Sovereign cloud customers

Outside the U.S., the SAP Sovereign Cloud Services organization already counts more than 170 customers globally and has plans to invest a further €2 billion over the next decade to expand regional coverage. For example, SAP is currently in talks with four Asian countries. In Germany, the unit provides secure sovereign cloud services through Delos Cloud and plans to launch similar services in France through Bleu.

Instead of getting involved in a futile race to catch up with the U.S., SAP executives argue that Europe must now promote the use of vertical AI for individual industries and special areas of application.

In a recent guest commentary in the German business newspaper Handelsblatt, Klein called for a digital strategy for Europe that builds on the region’s digital strengths: “A new, European-defined concept of sovereignty is necessary, one that relies on self-determination rather than self-sufficiency.” He also cautioned that digital sovereignty “is not an end in itself” and called for “profound change” to industry business models.

These models “need to be rethought, processes digitized, and AI used in a targeted manner for more innovation, for greater efficiency, for sustainability,” he added. 

Martin Merz, president SAP Sovereign Cloud, agrees. “The debate around digital sovereignty in Europe has gone on too long with too many buzzwords and too little substance,” he said. “We’ve reached a point where Europe can no longer afford misguided discussions. What counts is value creation. Real sovereignty includes empowering people, industries, and governments to lead through innovation.”

“When it comes to highly sensitive data, SAP Sovereign Cloud comes in,” Merz continued. “It’s purpose-built to protect the most sensitive, security-critical data, enabling the highest level of protection and operational autonomy, without slowing down innovation.”

Locally hosted AI

Underscoring this shift in the data sovereignty debate, many SAP customers are now talking about sovereign AI or what SAP calls “locally hosted AI.” To help facilitate this, SAP CTO Philipp Herzig recently noted that the company is now offering a range of self-hosted AI models in a more secure and local environment. “Starting Q3 this year, we are providing the entire AI foundation end-to-end out of European data centers. This is AI fully managed and operated by SAP,” he shared.

As a result, he said, customers will have access to cutting-edge local models like Mistral Small and Mistral Medium, Aleph Alpha, or the T-Free model used by the German government. “Their data will remain local, trusted, compliant, and secure, and seamlessly integrate with SAP Business AI capabilities without compromising on performance, governance, or privacy,” Herzig added.

He also revealed that Swiss Federal Railways is leading the way as an early adopter, using locally hosted AI with Mistral AI to power innovation in a trusted environment. Speaking during a recent NVIDIA conference in France, he also announced that SAP has formed a strategic partnership with Mistral AI and Capgemini to accelerate AI adoption across Europe.

“Together, we’re building the future of enterprise AI – secure, local, and smart,” Herzig said.