As CIO of United Airlines, Jason Birnbaum is laser focused on using technology and data to enable the company’s 86,000 employees to create as seamless a customer travel experience as possible. “Our goal is to improve the entire travel process from when you plan a trip to when you plan the next trip,” says Birnbaum, who joined the airline in 2015 and became CIO last July.

One opportunity for improvement was with customers who are frustrated about arriving at the gate after boarding time and unable to board because the doors are shut, while the plane is sitting on the ground. “The situation is not only frustrating to our customers, but also to our employees,” Birnbaum says. “We are in the business of getting people to where they want to go. If we can’t help them do that, it drives us crazy.”

So, Birnbaum and his team built ConnectionSaver, an analytics-driven engine that assesses arriving connections, calculates a customer’s distance from the gate, looks at all other passenger itineraries, where the plane is going, and whether the winds will allow the flight to make up time, and then makes a real-time determination about waiting for the connecting passenger. ConnectionSaver communicates directly with the customer that the agents are holding the plane.

ConnectionSaver is a great example of how a “simple” solution resulted from a tremendous amount of cultural, organizational, and process transformation, so I asked Birnbaum to describe the transformation “chapters” behind this kind of innovation.

Chapter 1: IT trust and credibility

“For years, it was common for technology organizations to have too little credibility to drive transformation,” says Birnbaum. “That was our story, and we worked very diligently to change the narrative.”

Key to changing the narrative was giving senior IT leaders end-to-end business process ownership responsibilities. “We started moving toward a process ownership model several years ago, and since then, we’ve made significant improvements in technology reliability, user satisfaction, and our employees’ trust in the tools,” Birnbaum says. “This is important because every transformation chapter depends on use of the technology. If our employees don’t trust the tools, we will never get to transformation.”

A process could be gate management, buying a ticket, managing baggage, or boarding a plane, each of which runs on multiple systems. “Before we moved from systems to process ownership, people would see that their system is up, so they would assume the problem belonged to someone else,” says Birnbaum. “In that model, no one was looking out for the end user. Now, we have collaborative conversations about accountability for business outcomes, not system performance.”

Chapter 2: Improving the employee experience

Like every company, United Airlines has been working to improve the customer experience for years, but more recently has expanded its “design thinking” energies to tools for employees. To facilitate this expansion, Birnbaum grew the Digital Technology employee user experience team from three people to 60, all acutely focused on integrating the employee experience into the customer experience.

The employee user experience team spends time with gate agents, contact centers, and airplane technicians to identify technology to help employees help customers. “The goal of the employee user experience team is to provide tools that are intuitive enough for the employee to create a great customer experience, which in turn, creates a great employee experience,” says Birnbaum. “It is important for companies to invest in change management, but you need less change management if you give employees tools that they really want to use.”

For example, the user experience team learned that flight attendants felt ill equipped to improve the experience of a customer once the customer is on the plane. If a customer agreed to change seats or check a bag, for example, there was little a flight attendant could do to improve the experience in real-time. “All they had was a book of discount coupons, but the customer had to call a contact center with a code to get the discount,” says Birnbaum. “The reward required five more steps for the customer; it did not feel immediate.”

So, the team developed a tool called “In the Moment Care,” which uses an AI engine to make reward recommendations to the flight attendant who can offer compensation, miles, or discounts in any situation. The customer can see the reward on his or her phone right away, which immediately improves both the customer and employee experience. “We knew the customers would be happier with having their problem solved in real-time, but we were surprised by how much the flight attendants loved the tool,” says Birnbaum.  “They said, ‘I get to be the hero. I get to save the day.’”

The employee user experience team then turned its attention to the process of “turning the plane,” which includes every task that happens from the minute a plane lands to when it takes off again. It involves at least 35 employees in a 30-minute window.  

Take baggage, for example. Traditionally, during the boarding process, if the overhead bins were starting to fill up at the back of the plane, that flight attendant had no way to communicate to the flight attendant in the front of the plane that it is time to start checking bags. Their only option was to call the captain to call the network center to call the gate to get them to start checking bags.

To create a better communication channel, the employee user experience team worked with the developers to create a new tool, Easy Chat, that puts every employee responsible for a turn activity into one chat room for the length of the turn. “Whether the bins are filling up, or they need more orange juice, or they are waiting for two more customers to come down the ramp, the team can communicate directly to digitally coordinate the turn,” says Birnbaum. “Once the flight is gone, each employee will be connected to another group in another time and place.”

Again, Birnbaum sees that the value of Easy Chat is well beyond the customer experience. “I was just talking to a few flight attendants the other day, who told me that Easy Chat makes them feel like they are a part of a team, rather than a bunch of people with individual roles,” says Birnbaum. “United has a lot of employees, and they don’t work with the same people every day. The new tool allows us them to work as a team and to feel connected to each other.”

Chapter 3: Data at scale

To improve the analytics capabilities of the company, Birnbaum and his team built a hub and spoke model with a central advanced analytics team in IT that collaborates with each operational area to develop the right data models. 

“The operating teams live and breathe the analytics — they are the people scheduling the planes — so they are key to unlocking the value of the analytics,” says Birnbaum. “Digital Technology’s job is to collect, structure, and secure the data, and help our operational groups exploit it. We want the data scientists in the operating areas to take the lead on how to make the data valuable at scale.”

For example, United has always worked to understand the cause of a flight delay. Was it a mechanical problem? Did the crew show up late? “The teams would spend hours figuring out whose fault it was, which was a huge distraction from running the operation,” says Birnbaum. To solve this problem, the analytics team, in partnership with the operations team, created a “Root Cause Analyzer” that collects operational data about the flight.

“Now, instead of spending time debating why the flight was delayed, we can quickly see exactly what happened and spend all of our time on process improvement,” says Birnbaum.

With the foundational, employee experience, and data chapters now under way, Birnbaum is thinking about the next chapter: Using technology and analytics to integrate and personalize a customer’s entire travel experience.

“If you have a rough time getting to the airport, but the flight attendant greets you by your name and knows what you ordered, you will still have a good trip,” says Birnbaum.  “It is our job to use technology to help our employees deliver that great customer experience.”

Digital Transformation, Employee Experience, Travel and Hospitality Industry

By Hock Tan, Broadcom President & CEO

Over the last several weeks, I have had the opportunity to visit with Broadcom customers around the world to discuss what’s on the horizon as they navigate increasingly complex IT operating environments. During these visits, I’ve also answered their questions and shared our vision of what a combined Broadcom and VMware will look like following the close of the transaction.

It’s clear from these conversations that three topics are top of mind for customers as it relates to the VMware-Broadcom transaction: multi-cloud, cloud-native apps and pricing. Ultimately, what I’ve stressed to them has been straightforward: our customers are and will remain the most important part of our business. That said, I want to discuss each of these topics and share my current thinking to help address the concerns I’ve heard.

Broadcom’s Strategy

I hope I’ve made clear that at Broadcom, we are continuing to embrace and invest in customers’ priorities. My priorities for Broadcom are very much aligned with customers.

By investing and innovating in infrastructure software and VMware’s broad portfolio — including multi-cloud and cloud-native capabilities — we will bring our customers greater flexibility and deliver new solutions to help them connect, scale and protect their IT infrastructure. This will also empower our customers to modernize and architect their IT infrastructure while ensuring there will be large-scale, secure, and reliable, yet flexible, solutions to do so. Similarly, continuing to develop our ecosystem will enable partners to grow their businesses with expanded offerings of the combined portfolio and even better meet customers’ needs.

Multi-Cloud

As I met with customers across the U.S., U.K., Germany and France, I asked about their current and future priorities. For some time, Broadcom has recognized that the future of enterprise IT is multi-cloud — the ability to distribute applications and services across a combination of clouds. It’s one of the many reasons Broadcom solutions complement what VMware does in the multi-cloud space across private, public, edge and sovereign clouds today. It’s clear our customers have already adopted this mindset, too. I’ll share an example.

While in London, I met with the chief technology officer of a global financial services firm. We discussed the increasing need for financial institutions to adopt innovative solutions and ensure legacy infrastructure is efficient and secure. We agreed multi-cloud solutions meet this need, ultimately improving performance and strengthening resilience at a lower cost. Customers are enthusiastic about the multi-cloud vision and, with increased resources from Broadcom following transaction close, the potential to implement it as VMware grows and increases momentum in the space.

Cloud-Native Apps

Customers are similarly excited about VMware’s momentum around cloud-native apps. Containers are changing the way modern applications are built, resulting in faster and more predictable development and deployment. Developers also can take advantage of Kubernetes clusters, which more efficiently use the containerized infrastructure that power those applications. Kubernetes clusters bring other advantages, including making apps more resilient and easier to manage, bringing cost savings to organizations; and  making apps more portable between different clouds and internal environments, because Kubernetes clusters can run on premises or within public clouds. The resulting modern applications are more scalable and flexible, accelerating the speed and agility of innovation within organizations. By providing customers with the environment and hands-on guidance to help build cloud-native applications quickly and upskill their teams along the way, a combined Broadcom-VMware can help them drive forward their businesses.

Since the announcement of our intention to acquire VMware in May, I have had the opportunity to spend time with many VMware and Broadcom customers, partners and the VMware Product and Go-to-Market leadership teams. I have gained a deeper understanding of the VMware Tanzu portfolio and the strategic importance of cloud-native applications and modern app development and management. Customers are telling me that modern applications are a central part of their go-forward strategy in a multi-cloud world, and that the VMware Tanzu portfolio of products and solutions are an important area of focus for them.

Many customers and partners are asking me how I see the VMware Tanzu portfolio and Broadcom’s future commitment to the Tanzu business. My answer to them is that I see Tanzu as a strategic part of the VMware software portfolio and it will remain that way as we move forward within Broadcom. VMware Tanzu customers are running some of the most mission critical applications in the world. As customers think about future investments in cloud native applications and the modern application development space, they should feel confident in Broadcom’s commitment going forward.

Pricing

We work with our customers every day to tackle a wide spectrum of challenges, and we are constantly innovating to create the next generation of technology to address their needs. This is largely what has made our business successful, and we intend for this to continue.

Our growth into a global technology leader was not based on taking existing products and raising their prices, but by creating technology and products that provide clear value to customers and continuing to improve them. We fuel growth by offering more and better products so customers are using more of our entire portfolio of technology products, rather than just one or two. By delivering long-term value to customers and investing in improved, customer-focused R&D, we can innovate, scale and offer better products without raising prices.

VMware develops technology for the future and addresses a growing market. The Broadcom business case for this transaction is premised on focusing on the business model, increasing R&D, and executing so that customers see the value of the full portfolio of innovative product offerings — not on increasing prices. Following the close of the transaction, we will invest in and innovate VMware’s products so we can sell even more of them and grow the VMware business within enterprises, deepening and expanding the footprint instead of potentially raising prices.

Of course, our other main priority once the transaction is complete will be integrating VMware and its employees. VMware is an innovation success story — but the company’s story is far from finished and we’re excited to help write the next chapters. I have tremendous respect for what VMware has built, and experiencing the company’s excitement for the future at VMware Explore in San Francisco earlier this year reinforced my belief that we are on the right path.

I came away from my recent travels even more excited about what a combined Broadcom and VMware can deliver to our customers, and I look forward to continuing these valuable conversations as we progress toward closing. More than that, once we complete our transaction, I look forward to starting the important work of fostering an environment of growth and innovation aligned with our customers’ priorities.

To stay updated on the news about the transaction, click here.

Cautionary Statement Regarding Forward-Looking Statements

This communication relates to a proposed business combination transaction between Broadcom Inc. (“Broadcom”) and VMware, Inc. (“VMware”).  This communication includes forward-looking statements within the meaning of Section 21E of the U.S. Securities Exchange Act of 1934, as amended, and Section 27A of the U.S. Securities Act of 1933, as amended.  These forward-looking statements include but are not limited to statements that relate to the expected future business and financial performance, the anticipated benefits of the proposed transaction, the anticipated impact of the proposed transaction on the combined business, the expected amount and timing of the synergies from the proposed transaction, and the anticipated closing date of the proposed transaction.  These forward-looking statements are identified by words such as “will,” “expect,” “believe,” “anticipate,” “estimate,” “should,” “intend,” “plan,” “potential,” “predict,” “project,” “aim,” and similar words or phrases.  These forward-looking statements are based on current expectations and beliefs of Broadcom management and current market trends and conditions. 

These forward-looking statements involve risks and uncertainties that are outside Broadcom’s control and may cause actual results to differ materially from those contained in forward-looking statements, including but not limited to: the effect of the proposed transaction on our ability to maintain relationships with customers, suppliers and other business partners or operating results and business; the ability to implement plans, achieve forecasts and meet other expectations with respect to the business after the completion of the proposed transaction and realize expected synergies; business disruption following the proposed transaction; difficulties in retaining and hiring key personnel and employees due to the proposed transaction and business combination; the diversion of management time on transaction-related issues; the satisfaction of the conditions precedent to consummation of the proposed transaction, including the ability to secure regulatory approvals on the terms expected, at all or in a timely manner; significant indebtedness, including indebtedness incurred in connection with the proposed transaction, and the need to generate sufficient cash flows to service and repay such debt; the disruption of current plans and operations; the outcome of legal proceedings related to the transaction; the ability to consummate the proposed transaction on a timely basis or at all; the ability to successfully integrate VMware’s operations; cyber-attacks, information security and data privacy; global political and economic conditions, including cyclicality in the semiconductor industry and in Broadcom’s other target markets, rising interest rates, the impact of inflation and challenges in manufacturing and the global supply chain; the impact of public health crises, such as pandemics (including COVID-19) and epidemics and any related company or government policies and actions to protect the health and safety of individuals or government policies or actions to maintain the functioning of national or global economies and markets; and events and trends on a national, regional and global scale, including those of a political, economic, business, competitive and regulatory nature.

These risks, as well as other risks related to the proposed transaction, are included in the registration statement on Form S-4 and proxy statement/prospectus that has been filed with the Securities and Exchange Commission (“SEC”) in connection with the proposed transaction.  While the list of factors presented here is, and the list of factors presented in the registration statement on Form S-4 are, considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties.  For additional information about other factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to Broadcom’s and VMware’s respective periodic reports and other filings with the SEC, including the risk factors identified in Broadcom’s and VMware’s most recent Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K.  The forward-looking statements included in this communication are made only as of the date hereof.  Neither Broadcom nor VMware undertakes any obligation to update any forward-looking statements to reflect subsequent events or circumstances, except as required by law.

No Offer or Solicitation

This communication is not intended to and shall not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities, or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.  No offering of securities shall be made, except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.  

Additional Information about the Transaction and Where to Find It

In connection with the proposed transaction, Broadcom has filed with the SEC a registration statement on Form S-4 that includes a proxy statement of VMware and that also constitutes a prospectus of Broadcom.  Each of Broadcom and VMware may also file other relevant documents with the SEC regarding the proposed transaction.  The registration statement  was declared effective by the SEC on October 3, 2022 and the definitive proxy statement/prospectus has been mailed to VMware’s stockholders. This document is not a substitute for the proxy statement/prospectus or registration statement or any other document that Broadcom or VMware may file with the SEC.   INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT, PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS THAT MAY BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.  Investors and security holders may obtain free copies of the registration statement and proxy statement/prospectus and other documents containing important information about Broadcom, VMware and the proposed transaction, once such documents are filed with the SEC through the website maintained by the SEC at http://www.sec.gov.  Copies of the documents filed with the SEC by Broadcom may be obtained free of charge on Broadcom’s website at https://investors.broadcom.com.  Copies of the documents filed with the SEC by VMware may be obtained free of charge on VMware’s website at ir.vmware.com.

Participants in the Solicitation

Broadcom, VMware and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction.  Information about the directors and executive officers of Broadcom, including a description of their direct or indirect interests, by security holdings or otherwise, is set forth in Broadcom’s proxy statement for its 2022 Annual Meeting of Stockholders, which was filed with the SEC on February 18, 2022, and Broadcom’s Annual Report on Form 10-K for the fiscal year ended October 31, 2021, which was filed with the SEC on December 17, 2021.  Information about the directors and executive officers of VMware, including a description of their direct or indirect interests, by security holdings or otherwise, is set forth in VMware’s proxy statement for its 2022 Annual Meeting of Stockholders, which was filed with the SEC on May 27, 2022, VMware’s Annual Report on Form 10-K for the fiscal year ended January 28, 2022, which was filed with the SEC on March 24, 2022, a Form 8-K filed by VMware on April 22, 2022 and a Form 8-K filed by VMware on May 2, 2022.  Other information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, are or will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the proposed transaction when such materials become available.  Investors should read the proxy statement/prospectus carefully before making any voting or investment decisions.  You may obtain free copies of these documents from Broadcom or VMware using the sources indicated above.

About Hock Tan:

Broadcom Software

Hock Tan is Broadcom President, Chief Executive Officer and Director. He has held this position since March 2006. From September 2005 to January 2008, he served as chairman of the board of Integrated Device Technology. Prior to becoming chairman of IDT, Mr. Tan was the President and Chief Executive Officer of Integrated Circuit Systems from June 1999 to September 2005. Prior to ICS, Mr. Tan was Vice President of Finance with Commodore International from 1992 to 1994, and previously held senior management positions with PepsiCo and General Motors. Mr. Tan served as managing director of Pacven Investment, a venture capital fund in Singapore from 1988 to 1992, and served as managing director for Hume Industries in Malaysia from 1983 to 1988.

IT Leadership, Multi Cloud

If there is one universal truth, it’s that fashion is fickle.

In the apparel industry, what’s in fashion one day may be out of fashion the next. So, if you’re an apparel manufacturer, you need the most efficient, responsive, and innovative operation possible. That way, you can keep up with ever-changing demand and stay in fashion with your retailer customers — as Crystal International Group, Ltd. (Crystal) has accomplished with great success.

Established in Hong Kong in 1970 by Kenneth and Yvonne Lo, Crystal grew from a small workshop with a few sewing machines and knitting looms for producing sweaters into a global apparel leader. Today, the company has 20 self-operating manufacturing facilities in five countries, with approximately 70,000 employees. Every year, Crystal delivers more than 450 million pieces of apparel — and we’re not talking about just sweaters.

The company makes lifestyle wear; denim; intimates; outdoor apparel; sportswear for top brands, such as adidas, Nike, and PUMA; and, yes, sweaters for international brands, including UNIQLO, Gap, and H&M plus L Brands, which operates Victoria’s Secret.

The company is more than a top manufacturer. It’s also a social and environmental leader. In fact, Crystal has been ranked 17th out of 50 on Fortune Magazine’s “Change the World” list.

The goal of enhancing the outfit

Efficiency, responsiveness, innovation — as well as quality — are top of mind with Crystal. And that applies to all aspects of the operation, including manufacturing and business processes.

In terms of manufacturing, the company is always looking to boost its ability to satisfy customer requirements. What will it take to meet product specifications? Are there better ways to source and utilize raw materials? How can manufacturing processes and workflows, in general, be accelerated and streamlined? At the same time, the company wants to continue developing solutions to reduce discharges that might impact the environment.

On the business side, efficient processes help with Crystal’s order fulfillment, order-to-cash cycle, and other factors that can affect its bottom line and customer satisfaction.

Threads out of place

Until recently, the manufacturing facilities were “self-operating” without a strong information exchange between facilities and headquarters. Manufacturing was not fully integrated with the corporate business group’s enterprise resource planning (ERP) solution. For example, disparate ERP solutions were used to fulfill local requirements in China, often creating duplication. As a result, it was difficult to obtain real-time operational information to help make better decisions about production improvements, scheduling, inventory, deliveries, and more.

On the manufacturing and business sides, employees were dealing with many labor-intensive, manual processes that slowed down work. In the business area, there were time-consuming check-and-verify processes, such as bank reconciliations. Management lacked visibility during period-end closing — to name a few challenges.

The latest in digital ware

Working with SAP platinum partner DynaSys Solutions Ltd., Crystal has implemented an end-to-end intelligent enterprise solution to improve its operation. The solution leverages SAP S/4HANA for fashion and vertical business, in addition to SAP SuccessFactors, SAP Intelligent Robotic Process Automation, SAP Business Technology Platform, SAP Manufacturing Execution, and SAP Manufacturing Integration and Intelligence.

So, what have those SAP tools added to the Crystal wardrobe or enterprise? Plenty. The company has benefitted from the ability to gather real-time information from its facilities for better insights. Other advantages include enhanced end-to-end engagement with employees, such as aligning employee databases, and improved governance.

Integration is the new black

A host of labor-intensive processes covering ERP, finance, and HR are now accelerated and streamlined with automation. Shop floor operations are integrated with SAP ERP in real-time. Vendor invoicing is integrated with SAP payment processes. Required data objects from SAP and non-SAP systems are integrated, creating a central information hub repository.

Karl Ting, IS General Manager, Corporate Information Services, Crystal International Group

Crystal International Group

The company is more efficient and responsive, with more time to innovate. “As a fast-fashion enterprise, we need innovative and dynamic solutions to capture the ever-changing market opportunities and drive our business growth in sync with our priorities, “says Karl Ting, IS, General Manager, Corporate Information Services, at Crystal. “SAP solutions have helped us succeed.”

All this led to Crystal becoming a proud participant of the 2022 SAP Innovation Awards.

To learn more about this accomplishment, including their metrics from using SAP solutions, read Crystal’s SAP Innovation Awards pitch deck.

Data Management

Listening to customers is a strategy that often sounds good on paper but is soon overshadowed by other areas of business or trends. Hyland, however, remains laser-focused on making sure customer success is the key to product improvements and a core component of the company’s culture. We spoke with Drew Chapin, CMO at Hyland, to learn more.

How would you describe Hyland in six words or less? How does Hyland help customers create a better experience for end users?

Hyland helps customers deliver better experiences. We do it by automating manual and complicated processes, which allows people to focus on their purpose rather than a manual task or process.

Customer expectations have changed with the convenience of things like Amazon where they do amazing things at the click of a button, and now expect that same experience from their work technology. Hyland strives to take many of the manual and complicated tasks off their plates so that physicians can treat patients better, educators can teach students better and insurance agents can process claims better.

What sets Hyland apart from other players in the industry?

There is confidence that we’ve earned from 30 years in this space, and our ability to deliver consistently. What also differentiates us is the breadth of product features, flexibility and the ability to configure our solutions. We give our buyers options, such as low- and no-code options, open-source through our Alfresco platform and innovative solutions, like our digital asset management offerings through Nuxeo.

We have a customer- and employee-centric culture, with which we have been able to attract and retain a very talented and deeply experienced workforce. We learned a long time ago that happy and engaged employees deliver amazing experiences to customers, and believe that investing in our employees will deliver value to our customers in a meaningful way.

Tell us about the X factor and Hyland’s partnership with Xander Schauffele.

We started our partnership in 2019. We view X factors as the things – sometimes they’re big, sometimes they’re small – that give you an edge over the competition to help you win.

The story for Xander is that he’s looking at all aspects of his game – driving, tee-to-green, bunker work and putting – to get any little edge he can earn to help him win. Our customers are doing the same thing. They’re looking at business processes and trying to optimize those to better serve their customers.

To learn more, visit Hyland.

IT Leadership

SAP has given CIOs another reason to consider moving to the cloud: rising support costs for on-premises software.

The company will raise the cost of its SAP Standard Support, SAP Enterprise Support, and SAP Product Support for Large Enterprises contracts for existing customers from January 1, 2023. Prices will rise in line with customers’ local consumer price index (CPI), with the increases capped at 3.3%. The changes will come into effect when customers renew their annual support contracts for the second time, affecting those who signed up before January 1, 2021.

The ERP vendor laid out its plans in a document entitled “Adjustment of SAP Support Fees,” which it finalized at the end of August.

SAP blamed the change on the higher costs of energy, labor, and third-party services, which are affecting the company just as many other businesses. It said it had kept the price of its support offerings broadly stable for almost a decade, even waiving adjustments during the pandemic.

The price increases only relate to support contracts for existing on-premises software, and the list price for support for new purchases of on-premises software will not increase, SAP spokesman Martin Gwisdalla told CIO.com in an email, meaning that users of SAPs cloud software and services will not be affected by these particular increases.

However, SAP’s cloud users may not be sheltered from the increases, as the company is also considering ratcheting up the price of its cloud software by 3.3% every year, CEO Christian Klein told German newspaper Handelsblatt in late July.

The German-speaking SAP Users Group, DSAG, is unimpressed with the company’s plans: “It is trying to establish mechanisms here that increase the costs for cloud services far above inflation,” Thomas Henzler, DSAG board member for licenses, service, and support, told CIO.com.” This is absolutely unacceptable and also incomprehensible.” With the service price rise and the threatened increase in cloud prices, SAP’s oldest on-premises customers could find themselves in a bind. SAP has been touting its cloud services as a way to keep licensing, maintenance and hosting costs under control, particularly with its “Rise with SAP” all-in-one offering, and has longstanding plans to move users of its previous software generation, ERP 6.0 and Business Suite 7, to a higher-paying support tier after standard support ends in 2027.

SAP

By Rob Greer, Vice President and General Manager, Symantec Enterprise Division

As the GM of Symantec, I had the good fortune of being able to attend both the Gartner Security & Risk Management Summit and the 2022 RSA Conference the week of June 6. While attending two conferences on different coasts in a single week gave me jet lag, it also gave me a chance to hear again the concerns of some of the smartest security practitioners around – our customers.

Strolling through the hall exhibits, where so many cybersecurity vendors showcased their products and services, I could only imagine how challenging it is for an organization to break through all the white noise and conflicting messages, and zero in on the best solution for their environment. Here are key takeaways from my week at both conferences. 

Tools management overload is a huge problem.

This was a hot-button topic everywhere I turned. More tools require extra work to manage but don’t guarantee more security. Enterprises wind up running security products from different vendors side by side that have little integration or coordination, leaving dangerous gaps in their defenses. And organizations don’t have the bandwidth to act as system integrators for so many different vendors and products. As a result, CISOs are rightfully raising questions as to why they still get breached and fail audits while absorbing the high costs of purchasing and managing more and more tools.

Integration that reduces complexity will become a dominant trend.

I hear the same request from customers over and over: They want out-of-the-box integration, especially when deploying multiple tools from the same vendor. As an industry, it’s clear that we need to reduce the number of management consoles, reporting infrastructures, and inspection engines for our customers. That also means offering common ways to authenticate, run reports, and check for threats. Not to mention, customers should be able to perform multiple security functions without needing to deploy a large number of agents. For example, any customers deploying Symantec Endpoint Security Complete can use the same agent to redirect traffic to our Symantec Enterprise Cloud when they’re exposed on the internet and not behind a proxy or firewall. All that traffic is then tunneled to our cloud where it gets inspected just as if the user was on a protected private network. We’ve similarly integrated our Zero Trust Network Access, Web Isolation, and our Secure Web Gateway technologies so that our customers don’t need to manage disparate solutions. Frankly, not all of our competitors have similarly grasped this message.

Security in the post-Covid world has changed.

After what we all went through in the last two years, customers need to treat their internal environment as if their employees all work from their local coffee shops. Forget the conventional thinking about network security. It’s now all about identity, the data, the applications, and the devices that you need to protect. Traditional notions about the network no longer apply. Don’t assume you can trust any packets on your network, and it’s no longer reasonable to believe you’re going to always stop adversaries at the front door. So, it becomes all the more critical to continuously track the behavior of every user and every system inside your environment, and immediately block anything outside the norm. This also underscores the need to embrace Zero Trust – but, as I talk about next, make sure you understand what that entails.

Zero Trust isn’t what you might think.

It’s altogether unsurprising that many security companies are hyping “Zero Trust solutions.” That’s false advertising. Zero Trust is an approach, not an outcome. It’s part of a philosophy and a way of thinking about overall security. Simply put, nothing can be trusted. As a result, you need to put in the right checks and balances – based on context – to determine how you allow individuals or devices to communicate with your applications and data. And there is no real finish line. Zero Trust is a journey and not something that you’ll ever be finished with.

A cybersecurity skills shortage is no closer to resolution.

The biggest issue facing the industry remains the lack of qualified individuals who can work in cybersecurity. We’re lucky to work in a fascinating sector but there remain too many open job slots. Fixing the problem will take time and is going to require clever solutions. Beyond the obvious need to automate more front-line security tasks, we simply need more qualified cyber defenders in the market. I spoke with one executive from a Bay Area company that is creating a fund allowing anyone going to a public community college to get cybersecurity training for free. That’s a great idea. I have been in this industry for many years, and there will always be a skills shortage, so every effort to address this is a step in the right direction.

Hybrid cybersecurity is a real “thing.”

There is no doubt that we’re in a world where the majority of organizations intend to move their workloads to public clouds. However, it’s a mistake to believe that this decision is “all or nothing.” It’s unlikely to ever be the case that any large company moves all of their applications and data exclusively to a single cloud vendor. Enterprises still want to leverage multiple clouds, including their own. When companies operate their own data centers on-premises, they can more easily implement their own unique requirements. And even for companies moving to the public cloud, most go the multi-cloud route to give themselves more flexibility. 

Stabilize your identity infrastructure.

Cybersecurity solutions are not nearly as effective in any organization that fails to build a robust identity infrastructure with multifactor safeguards. It’s still common to find organizations that haven’t integrated Active Directories from multiple trees that may reside in different parts of their enterprise. That likely means that privileged credentials are spread out everywhere and not being governed effectively. Accounts that should be disabled or deleted are still active. It’s hard to solve security problems when your own identity trees aren’t properly managed. 

The security conversation must continue.

Customers must keep asking themselves basic questions so as not to leave themselves vulnerable to attacks. Questions such as:

Where is my most important data and who has access to it?Am I vulnerable to known exploits?Am I patching intelligently and often?

Any organization that ignores foundational hygiene and gets distracted by the shiny new objects marketed at cybersecurity shows like RSA exposes their company and their customers to significant risk.

To learn more about how Broadcom Software can help you modernize, optimize and protect your enterprise, contact us here.

About the Author:

Broadcom Software

Rob Greer is Vice President and General Manager of the Symantec Enterprise Division at Broadcom (SED). In this role, he is responsible for the go-to-market, product management, product development and cloud service delivery functions.

IT Leadership, Security