Updated Adidas has opted to upgrade its ERP system to SAP S/4HANA, transferring it to the cloud with AWS rather than using RISE with SAP, the lift-shift-and-transform service launched by the German vendor earlier this year.
Seemingly without SAP’s knowledge, AWS confirmed it is now the sports brand's preferred cloud provider for SAP workloads. Under the arrangement, Adidas, which boasted sales of around $23bn in 2020, will migrate its SAP environment to AWS and implement a modern SAP S/4HANA platform.
The press blurb said running these workloads in the cloud would “enable Adidas to digitize core business processes across its value chain to provide better consumer experiences, become a more data-driven business, and support new business models such as direct-to-consumer”.
“By committing to cloud infrastructure, we have the scalability and elasticity we need to handle the seasonality of our business during peak demand and support the projected growth in our e-commerce business in the years to come,” said Markus Rautert, Adidas senior vice president, technology enablement, in a pre-canned statement.
“Deploying SAP environments on AWS isn’t just about transforming our technology — it’s about transforming business opportunities and using AWS’s wide range of cloud capabilities to create efficiencies and bring us closer to consumers.”
SAP is keen to get its extensive on-prem ERP users-base into the cloud, if only because subscription revenues offer it higher margins. Such is its desire, it launched RISE with SAP at the beginning of the year, after SAP slashed its forecasts for sales in 2020, which wiped €28bn off its value.
The programme promises to simplify migrations by providing clients with “one hand to shake” behind which it would deal with third-party service providers.
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It appears as if the Adidas deal has been struck outside of that arrangment, with neither the sportswear brand, SAP or AWS providing further comment.
According to analyst website, AppsRuntheWorld, Adidas currently runs an ECC 6.0 environment, the last version of SAP's ERP system before the in-memory system S/4HANA was released in 2015.
According to the released information, Adidas is set to take advantage of AWS technologies which compete directly with SAP’s portfolio.
These include advanced analytics capabilities, data science, and enterprise reporting. Adidas plans to build a cloud-based data lake on AWS, to help it “gain visibility across its internal and consumer-facing operations to deliver new business and consumer insights.”
Adidas also plans to use Amazon SageMaker, a machine learning environment, to help developers and data scientists build, train, and deploy machine learning models quickly
The sports brand also intends to use AWS to run “complex workloads” for design teams around the world to “modernize 3D design capabilities at scale”. It hopes this will speed up the design and creation process, reduce costs, and allow for greater collaboration with consumers and designers.
SAP has its own data lake technology in Data Lake IQ, as well analytics system Leonardo and SAP Fiori machine learning environment. ®
Updated to add at 14:10 UTC 23 November 2021:
An SAP spokesperson told us: "Adidas and SAP share a long-standing and trustful collaboration and both AWS and Adidas kept us in the loop on this announcement. As part of the SAP S/4HANA transformation, Adidas has decided to host its SAP System infrastructure on a platform provided by the hyperscaler AWS."