SAP NS2 execs on why secure cloud services are the future

U.S. government agencies have the same requirements for implementing ERP systems as any other organization -- only they have to do so under highly regulated conditions. For example, the U.S. Defense Security Service's Foreign Ownership, Control or Influence regulations affect how foreign-owned entities can do business with organizations that have access to classified data.

SAP National Security Services Inc., -- better known as SAP NS2 -- was created to address that very issue. Spun out of SAP, SAP NS2 offers secure cloud services, including NS2 Cloud and SAP Secure HANA cloud, to provide SAP technology organizations affected by FOCI. Cloud services include SAP ERP systems and SAP HANA-based analytics applications. Headquartered in Germany, the company operates outside of SAP's governing structure, with an independent board of directors.

In this Q&A, Mark Testoni, CEO at SAP NS2, and Harish Luthra, managing director of secure cloud business at SAP NS2, discuss the evolution of ERP and dispel some of the myths about secure cloud services for ERP data and applications.

What is SAP NS2 and how does it differ from SAP?

Mark Testoni: SAP NS2 is fully functioning software company that was created to resell and extend SAP capabilities for the national security market. It replicates SAP's functions, but it's totally independent and outside of SAP network systems. It's U.S.-hosted and -based, and a lot of our people are credentialed by the U.S. government or hold some sort of security validation. We do everything from selling the software in selected markets -- national security, defense, intelligence -- to implementing services and product support.

What technology does SAP NS2 deal with?

Mark Testoni

Testoni: In the intelligence and national security space, a lot of the ERP decisions were made a long time ago, but some are coming back for a relook now. We've had a push on the use of HANA as an independent platform, using the engines and the real-time in-memory capability to do data fusion and to support intelligence. A few years ago, the CIA selected the AWS platform for the cloud, and some in the intel community started to relook at their legacy ERP decisions, so we're seeing some activity there. But a lot of the push has been at the data problem, which is an important factor for all businesses.

There's still a perception that the cloud is not very secure, especially for public sector entities. Can they use secure cloud services for data and applications?

Testoni: The cloud is first and foremost an architecture and there are lots of flavors of it, but cybersecurity may be the most misunderstood issue. Back in 2009, the CIO of the federal government proclaimed the government would be cloud first. This takes time, but eventually they're moving in that direction. So cloud architecture capability is alive and well in the government, including in the most sensitive areas for business. When the CIA put up its own private commercial cloud on AWS, that sent a big message. There's been a tremendous amount of activity [around the cloud] in the last few years, and the government has set up a whole body of standards and requirements to operate clouds.

Do you find some organizations are still reluctant to go to the cloud? How do you respond?

Harish Luthra

Harish Luthra: There are a lot of myths about going to the cloud. There was a senior leader in the U.S. Army [who was resistant to going to the cloud], but we kept working with his office and providing information. Within three months, he was totally turned around. He came to us and said, 'I need to know how fast you guys can move [us] to the cloud.' There is reluctance out there due to bad information, so it's really an education issue.

Testoni: The Office of the Secretary of Defense has started an initiative called JEDI [Joint Enterprise Defense Infrastructure], which basically creates a cloud environment for the Department of Defense. There's nothing quite like an OSD level initiative to force the subordinate military departments into action. As OSD announced that it was going to drive [the adoption of] a common cloud environment, all of the individual military departments got very aggressive in going to the cloud.

How does SAP NS2 work with public cloud providers like AWS and Google Cloud Platform?

Luthra: We're working with these hyperscalers -- AWS, Azure and Google Cloud Platform -- for architecting what our offerings are going to be on top of these platforms. There are three benefits customers can get from the cloud: better performance, lower total cost of ownership, and the applications are up and running all the time.

What's in store with next-generation technology such as AI or advanced analytics?

Luthra: Technology is evolving, and a lot of these organizations have monolithic systems that are hard to get data out of. One of the trends we're seeing is to take the business transactions out [of ERP systems] and put them in areas where the business can take advantage of the data and the functionality that's available. AI, machine learning, IoT is all part of this. If you look at ERP systems, HR data and human capital management data is coming out of it, supply chain data is coming out of it, asset and predictive maintenance data is coming out of it. Organizations, whether they're government or commercial, want to make sure that whenever they need to extend new technology -- whether it's machine learning, AI, IoT or blockchain -- they can use those technologies to improve whatever they need to do.

Testoni: From a business perspective, the cloud is just the next generation of internet-enabling technologies. In its basic form, the cloud is just fences, guard-dog servers, and orchestration software. There will be a heterogeneous environment of on-premises applications and cloud. But the goal is to pick up our smartphone like we do today when we want to something on a personal level, and to conduct business securely on the same device. The only way we're going to get there is through these applications. SAP has talked about the intelligent enterprise, and that's being extended into the customer experience intelligent enterprise. The only way we're going to get there is through an ability to share this digitized data. The cloud is the enabling platform that can pull all of these parts together.