• 4 min read

SAP and Microsoft partner to deliver supply chain and Industry 4.0 solutions in the cloud

Current market conditions demonstrate how heavily the world relies on technology to increase the resilience of the supply chain, and how important agility and data insights are to enable quick decision-making and shifts in strategy to serve rapidly changing needs.

Current market conditions demonstrate how heavily the world relies on technology to increase the resilience of the supply chain, and how important agility and data insights are to enable quick decision-making and shifts in strategy to serve rapidly changing needs. To meet these needs, we are expanding our partnership with SAP to help customers design and operate intelligent digital supply chain and Industry 4.0 solutions in the cloud and at the edge. We will also work together to drive interoperability as members of industry alliances, such as the Open Manufacturing Platform and the Open Industry 4.0 Alliance.

SAP Digital Supply Chain and Industry 4.0 solutions run on Microsoft Azure

As a result of this partnership, organizations will be able to use a comprehensive set of SAP Digital Supply Chain solutions on Microsoft Azure, including SAP solutions for digital manufacturing, SAP Intelligent Asset Management solutions, SAP Integrated Business Planning, and SAP Logistics Business Network. SAP will use Microsoft Azure to run these solutions in a software-as-a-service (SaaS) model that can help reduce the customer’s need to manage the software and underlying infrastructure, while accelerating time-to-value of supply chain applications. Customers will be able to scale globally by leveraging Azure which offers enterprise-grade compute, storage, and network services to support mission-critical performance and business continuity to run SAP Digital Supply Chain solutions.

SAP Manufacturing Suite, SAP Intelligent Asset Management, supply chain network solutions from SAP, and the SAP Internet of Things (SAP IoT) solution are already available on Microsoft Azure in Europe and the United States today.

”SAP is excited to bring our proven and innovative solutions to Microsoft Azure for our manufacturing and digital supply chain customers. This partnership gives our customers the ability to subscribe to our digital supply chain and manufacturing solutions in the cloud and enhances our offerings for Industry 4.0. Building on this, SAP solutions will soon be available at the edge in factories, plants, and automated warehouses in close proximity to sensors, machines, and control systems.” —Franz Hero, SAP Senior Vice President for Digital Supply Chain Solutions.

SAP and Microsoft collaborating to bring business processes to the edge

When managing a global, distributed supply chain and manufacturing environment, companies face challenges with constrained bandwidth, latency, and massive volumes of data that can adversely affect execution and quality scenarios. Here the solution lies in edge computing.

Think of edge computing as a form of distributed computing where data, applications, and business processes are run near the source of generated data. The ability to extend and run business processes in a hybrid cloud model at the edge enables organizations with factories, plants, warehouses or remote operations, to fully automate and run their operations independentlyenabling faster processing and support for data residency requirements. Customers have the choice to only send data to the cloud which is relevant for additional analysis or an aggregated view across many edges to save costs.

SAP and Microsoft are also collaborating to make SAP solutions available on Microsoft Azure Stack Edge, starting with SAP Digital Manufacturing Cloud. This helps manufacturers process data locally across machines and control systems to address latency or connectivity restraints.

Customers are empowered to choose what business process to run in the cloud or at the edge based on business need; they can deploy specific business processes and relevant business data to specific edge nodes using SAP Edge Services. According to IDC research, “70 percent of IoT deployments by 2023 will include edge-based decision-making to support organizations' operational and strategic agendas.” The report also states that by “2023, 70 percent of enterprises will run varying levels of data processing at the IoT edge. In tandem, organizations will spend over $16 billion on IoT edge infrastructure in that time.”

Companies will provide a reference architecture as guidance to their customers

The partnership in supply chain and manufacturing will be further enhanced with reference architectures to provide customers guidance on deploying SAP Digital Supply Chain on Azure and the integration of SAP and Microsoft products and services, building on previously developed architecture blueprints.

For example, customers have a choice to use either Microsoft Azure IoT or SAP IoT to bring their time series data to the cloud. Time series data collected from machines or devices at the edge, and sent to the cloud, may be of little value on its own. Companies need to put time series data into business context by augmenting it with information stored in business applications for materials, products, customers, inventory, assets, and more. Combining business semantics and time series data using the SAP IoT solution creates business relevance, leading organizations to improved business outcomes and better decision-making.

SAP and Microsoft shape the future of Industry 4.0 with open standards

Cloud and edge computing, IoT, and AI help businesses reach the next level of productivity and gain significant advantages such as greater operational efficiencies, factory output, customer loyalty, and net profits. They empower companies to quickly adapt to new challenges and address fast changing customer needs and competitive pressure. They win visibility and agility across their entire supply chain, the ability to make quick and data-driven decisions by running rapid simulations and identifying patterns in large data sets or ramp-up production of urgently needed supplies through additive manufacturing. The challenge is to apply these technologies successfully in industrial environments that typically come with data silos, complex legacy systems, and high investment needs to address the extensive product and process renewal cycles. We believe that the synergy of open standards, open source, open data, and open collaboration is the key to address these common challenges.

We will work together with SAP to drive compatibility and interoperability across industrial machines, software, and services as members of consortia like the Open Manufacturing Platform and the Open Industry 4.0 Alliance to aid in the accelerated path to value of supply chain and Industry 4.0 related solutions based on open standards.

Companies that want to learn more about this exciting partnership and the benefits it brings should contact their SAP account team for further details.