2018_sow_cmd_webcast_duffaut.pdf

© 2018 Software AG. All rights reserved.
GO TO MARKET STRATEGY
NEXT STEPS
Eric Duffaut Jari Salminen
Chief Customer Officer VP Global IoT Sales
Capital Market Day 2018
March 12, 2018

2 | © 2018 Software AG. All rights reserved.
SAFE HARBOR
This presentation includes forward-looking statements based on the beliefs of Software AG management.
Such statements reflect current views of Software AG with respect to future events and results and are
subject to risks and uncertainties. Actual results may vary materially from those projected here, due to factors
including changes in general economic and business conditions, changes in currency exchange, the
introduction of competing products, lack of market acceptance of new products, services or technologies and
changes in business strategy. Software AG does not intend or assume any obligation to update these
forward-looking statements.
This presentation constitutes neither an offer nor recommendation to subscribe or buy in any other way
securities of Software AG or any of the companies that are members of the Group at present or in the future,
nor does it form part of such an offer and it should not be understood as such. This presentation does not
constitute an offer of sale of securities in the United States of America. Securities may not be offered or sold
in the United States of America without registration or exemption from registration in accordance with the U.S.
Securities‘ Act of 1933 in its currently valid form.

Optimize, Transform, Modernize
DBP Productivity
Sales Efficiency
INDUSTRY
Centric Specialization
+142% # Deals / +232% Use Cases
DBP Revenue
Profitable Growth
A&N Stabilization
Predictability
+50% vs. 14
All time high
Improved Operational Excellence
A&N 2050 program
Strengthened ability to execute GTM
…IN OUR 3 YEARS GTM TRANSFORMATION JOURNEY…
WE MOVED THE NEEDLE…
Q4 17 best Quarter ever

+23% Average Deal Size
+49% Deals +1M€
BRAND AWARENESS
Increased Deal Size
Gained Relevance through
…WE MOVED THE NEEDLE…
Social Media followers up 191%
Website engagement up 300%
Relevance & Scale
Ecosystem Expansion
Accelerated
Doubled # of partners/ Revenue Sourced by
Partners 28% (2017)
Cloud Business
Established a fast growing
+227% Order Entry / +361% Revenue

130%+ over 3 years
STOCK
Development
Sustained
TO MAKE SOFTWARE AG A DESTINATION
Customer Satisfaction
Rating
All time high
NPS from -24 to 18.9

ACCELERATE
SUCCESS…

13%
• Accelerate growth in
Emerging markets
• Expand share of wallet in
Installed Base
• Simplified Pricing Model:
DBP Bundles and
Subscription Based Pricing.
• Market Play & Industry
specialization: CoEs
SUSTAIN A&N REVENUE
A&N 2050: Legacy Digitization
DBP GROWTH
Effective & Efficient GTM Scalable
• Building a road-2-future for
every customer’s mission-
critical A&N application to
Optimize, Modernize &
Transform.
• Continuous innovation in
A&N technologies.
• Legacy Digitization
• Establish IOT GTM CoE:
strong GTM execution in
key selected markets to
quickly gain market share.
100M€ by end 2020
2018 PRIORITIES
RELEVANT - SCALABLE - CUSTOMER CENTRIC - PROFITABLE GROWTH
IOT & CLOUD : ACCELERATED
GROWTH

8 |
IOT MARKET VIEW

9 |
LARGE ADDRESSABLE MARKET WITH POCKETS OF
VERY FAST GROWTH
€175bn
CAGR
2015-2020
43%
Sources: IDC, Gartner, ABI Research, BCG Internet of Things buyer survey, expert interviews, BCG
analysis.
IoT platform market to grow to
€18bn with CAGR 66%
Source: IoT Application, Platform and Services Forecast: 2017-2026, MachNation,
September 2017

10 |
MANUFACTURING, LOGISTICS AND UTILITIES LEADING THE WAY
BUT SIGNIFICANT GROWTH ALSO IN B2C, RETAIL AND OTHER

11 |
WHERE DO WE SEE REAL MARKET DEMAND – NOW
AND WHAT ARE OUR CUSTOMERS FOCUSING ON
Smart Equipment Manufacturers
• Air/Gas compression equipment
• Industrial tools, consumer hardware
• Wind turbines
• Pumps/pump solutions
• Metal forming equipment
• Weather monitoring sensors
• Plastic extruders
• Textile machinery
• Healthcare machines
• …
Industrial IoT Solution Providers
Telecommunications
Utilities
Cities/Municipalities
Healthcare
Aviation
Retail
Oil & Gas
Insurance
Beverage
Construction
Facility/Property
…
Meeting regulatory
requirements
Differentiating product
and service offerings
Cost savings: avoid
failure, minimize waste
and loss, remote
diagnostics
New service offerings
(new business models)
Improving customer
service and experience

12 |
A TYPICAL IOT JOURNEY FOR AN ENTERPRISE CUSTOMER
FROM SIMPLE USE CASES TO AUTOMATION, PREDICTION AND INNOVATION
I – Collecting &
acting on data
• Basic functional & non-functional requirements
• Device Management, Basic analytics, Simple visualization
• Triggering events based on data
II – Automation &
Prediction
• Integration
• More complex analytical models
• Data reliability is critical
III – New business models, Innovation
• Organisational change
• From selling hardware to as-a-service
Focus on ROI and
increasing maturity of IoT
platforms drives demand
from large enterprise
customers

13 |
Yesterday
• IoT solutions focus on solving clearly defined
business problems
• Driven by Business Units
• Very little central IT involvement
BUYING IOT SOLUTIONS IN LARGE ENTERPRISES
CENTRAL ORGANISATIONS ARE GETTING MORE INVOLVED
Today
• Increasing involvement from central IT
• Dedicated IoT team / Centre of Expertise
• Aim to “harmonize” IoT solutions
• Positioning as internal “Service Provider”
Focus remains on solving the
problem with speed and ROI
But decision-criteria is changing
more towards:
• Cloud, multi-tenant platform
• Scalability & reliability
• Flexibility & openness
• Integration capabilities
• …

14 |
SINGLE IOT PLATFORM OFFERING
ADDRESSING THREE KEY MARKET OPPORTUNITIES
One Offering
• Product-based,
ready-to-use
• Complete and
modular
• Open, extendible
to meet future
needs
• Flexible
deployment with
no lock-in
Key Market Opportunities
Connected Industries
Multiple verticals, similar needs
Industrial platform and
solution providers
Telecom Service Providers

Benefits
• Reduced costs
• Increased customer loyalty
• Increased after sales revenues
“With data analytics our service reliability and product innovation can
progress in new ways. We are able to interpret real time data, predict
machine health issues and incorporate in field usage data into product
design.”
- Thomas Hamacher, CTO, Certuss
Reactive
Maintenance
costs
Limited
up-sell

16 |
“Cumulocity allows us to provide a uniquely branded, secure IoT
monitoring solution to our compressor distributors and service
partners allowing them to offer high-quality, real-time monitoring
solution to their customers”
- Sia Abbaszadeh, VP Global Marketing & Technology, Gardner Denver
Capture
operational info
+ provide to the
support org
Minimize
failures
Benefits
• Cost effective solution
• Time-to-value
• White-labelling

Benefits
• Creating a new B2C service
offering
• Making the bike more than the
bike
• Creating a relationship with
the consumer

“The Cumulocity solution for our Nespresso Capsule Dispensers
helped us to reduce out-of-order and out-of-stock situations to a
minimum.”
- Raoul Marechal, Technics and Operations Manager, Lyreco
Out-of-stock
situations
Reacting to
failures
Benefits
• Reduced costs
• Increased customer loyalty
• Increased revenue
Operational
costs

19 |
IOT GTM EXECUTION PLAN

20 |
© 2017 Software AG. All rights reserved. For internal use only
Apr May Jun Aug Sep Oct Nov
CeBIT
Germany
Jul Dec
Jan
GITEX
Dubai
IoT Mobile World
Congress
Barcelona
Mar
Feb
IoT World
Santa Clara
IOT World Forum
London
Asia IOT Business Platform
Various cities ASEAN
Bosch Connected
World
Berlin
IoT Solutions World Congress
Barcelona
IoT Tech Expo
Santa Clara
IOT Forum
Sydney
IOT World Santa Clara
– Emerald Sponsor
– 2 x speaker session
• Analyst Engagement
– Machnation - 3 Scorecards, 2 white papers, Online TCO
calculator
– Gartner IIOT Quadrant
– Forester webinar
MAJOR MARKETING FOCUS: 2,9M€ INVESTMENT IN IOT

21 |
IOT FIELD CENTER OF EXPERTISE (COE)
One Offering
• Product-based,
ready-to-use
• Complete and
modular
• Open, extendible
to meet future
needs
• Flexible
deployment with
no lock-in: On-
Prem, Cloud & Edge
Key Market Opportunities
Connected Industries
Multiple verticals, similar needs
Industrial platform and
solution providers
Telecom Service Providers
IOT Centre of Expertise (35 People)
• Globally governed, regionally
embedded
• Includes sales specialists, biz dev, IoT
architects & IoT consultants
• Addressing all customer scenarios, in all
regions
• Working in close alignment with
regional sales and consulting
organizations
One Specialized Team

22 |
MULTI-LEVEL APPROACH
FOR DIFFERENT CUSTOMER NEEDS & PHASES
Growing Maturity Level over Time
Flexibility
&
Sophistication
IoT SaaS
Fast Entry Low Touch GTM
• Web, self-service, supported by
Inside Sales
• Pre-defined solution accelerators
IoT PaaS
“Land & Expand” Specialized
IoT GTM resources
• Fast go-to-market
• Focus on business users
IoT Framework
Scale out C Level Support
• “Expand” footprint at existing
customers
• Strategic Partnerships
IoT Suite

23 |
AGILE AND FAST CUSTOMER ENGAGEMENT
FROM PROSPECT TO REPEAT CUSTOMER
www
traffic
Free trial POC LAND
# trials # POCs
€ of POCs
EXPAND
IOT SALES SPECIALIST
INSIDE SALES CUSTOMER SUCCESS MGR
# deals
Revenue committed
Revenue forecasted
Retention/renewal rate
Incremental revenue
Qualified
lead
# leads
€ leads
Other
Fast and good deal
qualification is critical
Our current win rate with
qualified leads is 50%+
Our current win rate from
POC is 80%+
Qualification checklist
POC offer template
Key Metrics
Tools
SAG
sales
roles
Demo kit
Reference stories
Teasers, whitepapers
Transparent, simple pricing
Contract template
Roadmap webinars
Use case webinars
# leads

24 |
SOFTWARE AG’ IOT PARTNER ECOSYSTEM
2018 FOCUS
Awareness & Mindshare Delivery & Devt. Extension New scalable Routes to
Market
Create stronger C-Level
Awareness
Broaden Cumulocity IOT
Development Capabilities
and Delivery Capacity
Drive Cumulocity IOT market
adoption by addressing partner
owned customer base
(OEM, Market Places, …)
Analysts, Strategy & Mgmt
Consulting Firms
Global and Regional
System Integrators
IoT Solutions & Services providers
SaaS & Cloud Providers
IOT Hardware & Devices
OT (Operations technology)
Providers
70 to 80% of IoT Business through Partners

25 |
EXPANDING 360O
PARTNER ECOSYSTEM
Hardware (IT)
Providers
E2E IoT
Solution
Providers
Telco
operated
Cloud
Strategy &
Mgmt
Consulting
IT
Consulting
& System
Integrators
Cloud and
SaaS
Providers
SAG‘S IOT ECOSYSTEM SCOPE IS GETTING WIDER

26 |
IoT Suite
MULTIPLE GO TO MARKET MODELS
ECOSYSTEM ENABLING SCALE
End Customer
SaaS
End Customer
PaaS
IoT Platform or
Solutions provider
End Customers
SaaS
IoT Service
Provider
SaaS PaaS
PaaS

2018_sow_cmd_webcast_duffaut.pdf

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2018_sow_cmd_webcast_duffaut.pdf