Why did SAP buy Qualtrics?
SAP has paid $8B for Qualtrics. That's a massive investment and one of the highest value acquisitions for a cloud software provider.
From qualtrics.com:
Over 10,000 enterprises worldwide, including more than 75 percent of the Fortune 100 and 99 of the top 100 U.S. business schools, rely on Qualtrics to consistently build products that people love, create more loyal customers, develop a phenomenal employee culture, and build iconic brands.
What is Qualtrics?
Qualtrics is the market leader in "experience management" (EM), which is basically feedback, think of customer feedback, end user feedback, product feedback, etc. Experience (feedback) has become so central to our lives today, just think about Google reviews, Amazon reviews, Yelp reviews and just think of the reviews and surveys you get exposed to in every day life. I get sent surveys every time I fly, rent a car or even when I call my ISP customer support.
Although I'm no expert on the EX market, my experience as a consumer tells me that companies are spending a great deal of money and effort to gather this data. That said, I'm not convinced that they are always taking full advantage of the EX data they are gathering.
Over 10,000 enterprises worldwide, including more than 75 percent of the Fortune 100 and 99 of the top 100 U.S. business schools, rely on Qualtrics to consistently build products that people love, create more loyal customers, develop a phenomenal employee culture, and build iconic brands.
What is the Vision?
SAP has a vision to combine its Operational Data with Qualtrics Experience Data, but what does this really mean? I think that SAP will combine X & O data, along with the power of SAP's analytics capabilities.
One example SAP has used is the ability to combine Success Factors and Qualtrics to identify employee flight risk and root cause for business under-performance.
Here is more information on this topic: https://www.sapanalytics.cloud/resources-visualizing-qualtrics/
Reading this article reminded me of a time I supported an extremely effective EVP in his efforts to turn around an under-performing country/subsidiary of our company. One of the first things he did when he landed in country, was to contact and meet with a bunch of ex-employees, key customers and vendors as well as key existing employees. He had a great talent for finding the right people and understanding the information he gathered from them. He believed that understanding the root cause of the problem was the most critical step in any process improvement. I think he was right!
I think its pretty obvious that the most successful companies understand their customer deeply. SAP has really been successful through delivering capabilities to understand the enterprise, by providing a common business foundation, the ability to see (in real time) how different products, customers, customer segments, regions etc are performing, not just in revenue terms but in real financial contribution. I can see the Qualtrics acquisition delivering the next step in advancing that visibility. Instead of just understanding financial performance (which is extremely valuable in its own right), now we can envision understanding the underlying reasons for the performance. I think that's a profoundly powerful vision.
One example SAP has used is the ability to combine Success Factors and Qualtrics to identify employee flight risk and root cause for business under-performance.
Here is more information on this topic: https://www.sapanalytics.cloud/resources-visualizing-qualtrics/
Reading this article reminded me of a time I supported an extremely effective EVP in his efforts to turn around an under-performing country/subsidiary of our company. One of the first things he did when he landed in country, was to contact and meet with a bunch of ex-employees, key customers and vendors as well as key existing employees. He had a great talent for finding the right people and understanding the information he gathered from them. He believed that understanding the root cause of the problem was the most critical step in any process improvement. I think he was right!
I think its pretty obvious that the most successful companies understand their customer deeply. SAP has really been successful through delivering capabilities to understand the enterprise, by providing a common business foundation, the ability to see (in real time) how different products, customers, customer segments, regions etc are performing, not just in revenue terms but in real financial contribution. I can see the Qualtrics acquisition delivering the next step in advancing that visibility. Instead of just understanding financial performance (which is extremely valuable in its own right), now we can envision understanding the underlying reasons for the performance. I think that's a profoundly powerful vision.
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