Business AI would be the next big bet for SAP: President & MD Kulmeet Bawa

German technology major SAP has seen strong growth in India over the last few years driven by the demand for cloud by the small and medium enterprise (SME) segment which is 80 per cent of its customer base. Today, it is investing heavily on artificial intelligence (AI) for business to solve critical customer problems. Kulmeet Bawa, president and MD, SAP Indian Subcontinent, talks about SAP’s growth journey in India and AI strategy, in a video interview with Ayushman Baruah. Edited excerpts:  

How has SAP grown in India over the last few years and what’s the way ahead?
 

It is a very exciting time for us to be in India. The market is growing. The domestic market, the euphoria we saw at the G20 Summit, the pace at which our startup ecosystem is growing – all of that makes India a strong market. Today around 60 per cent of India's GDP touches an SAP system. So we have been an intrinsic part of the India growth journey and nation building. Post pandemic, cloud and data started growing much faster than what we have ever seen and SAP was intrinsic to it. So we started seeing a lot of growth in the last few years. If I were to break it up into enterprise, digital natives, and mid-market segments, we are seeing growth all across the segments. We are industry specialised and seeing growth across verticals like CPG (consumer packaged goods), life sciences, manufacturing, pharmaceutical, etc. We have doubled our cloud customers long back and the mid-market which is a big focus for us, has grown inordinately in the last 2-3 years and continues to grow very quickly.

What is the share of SMEs in your customer base and how has it grown?
 

SAP India has over 10,000 customers in the mid-market segment at the moment. In accordance with global growth, 80 per cent of our total customer base is from mid-sized companies, which will also define the future for us. From an SAP India perspective, we are leading worldwide on cloud adoption. The pace at which our customers in India are adopting cloud solutions is very fast. In India, all our lines of businesses are growing in very high digits. We see a huge growth that is coming from the digital natives. 40 out of 100 unicorns in India run on SAP across agritech, edtech, fintech, D2C, EV space, etc. Today, we have hundreds of startups working with us. It's a change in culture for us at SAP which translates to a change in our technology offerings that are more agile and faster to implement.

As AI is the next big thing, what is SAP’s overall AI strategy?
 

AI has never been more exciting than now. Generative AI (GenAI) especially is going to be more disruptive than anything else we have ever seen. It will be even more disruptive than when for the first time, the internet or the mobile phone came in. It’s clearly revolutionary. What we make of it and how we raise it, will be upon us. SAP has always been at the forefront of innovation, defining what is next for us. That's exactly the same thing we will be doing with GenAI from a business perspective. Business AI would be the next big bet for SAP, aligning with our customers' priorities. There are three pillars to SAP’s AI strategy. First, it has to be relevant by helping customers make agile decisions and unlock valuable insights, and automate tasks with AI designed with their business context in mind. Second, it has to be reliable by using AI that is trained on industry and company data, driven by SAP process expertise, and accessible in the solutions clients use daily. Third, we must run responsible AI built on leading ethics and data privacy standards.

How do you ensure market penetration and position yourself as an AI-driven company?
 

AI is not new for us. We have embedded AI into our solutions for years. SAP embeds AI across its portfolio, leveraging the best AI tools in the market and combining them with extensive industry-specific data and deep process knowledge to deliver the solutions that power its customers' most critical business functions. Now, we are building GenAI use-cases. We are increasing our investments in GenAI and looking at how we can grow it not just within SAP but for the entire ecosystem. We have partnered with the likes of Google, Microsoft, and IBM, to help customers unlock the full potential of AI. Joule is our latest addition to the family. It is a natural-language, GenAI copilot that will transform the way business runs. Joule will be embedded throughout SAP’s cloud enterprise portfolio, delivering proactive and contextualized insights from across the breadth and depth of SAP solutions and third-party sources.