sfa

CRM SFA blog Blog Home Categories Archives About CRM gal Contact

sfa
sfa


 

 

free crm, software review, downtime, sfa, hosted software, salesforce, netsuite ipo, salesforce.com, online crm, web-based, marc benioff, marketing, accounting software, erp system, opportunity management, contact management, sales force automation software


 

 

Aplicor System Review

CRM Lessons Learned

Salesforce.com Group

SAP Business ByDesign

Search

Search This Site

 

 


SAP Business ByDesign's Two Phase Evolution
on-demand

SAP's September 19 Business ByDesign (BBD) software as a service (SaaS) announcement was a clear signal that the old guard ERP software makers can no longer ignore, dismiss and ridicule the hosted software movement. What wasn't so clear was the intended BBD audience. While SAP formally positioned the hosted software for small and midsize businesses, that target audience is extremely broad and the question which remains is whether the SaaS solution is more of an offensive play or a defensive tactic.

My early insight suggests that the BBD on-demand ERP software is more of a defensive tactic intended to slow the customer erosion of their clients' remote operations which were being diverted to both the traditional on-premise ERP systems such as Microsoft GP/NAV/AX/SL and Sage 200/500 as well as the new comer SaaS systems such as Salesforce.com, NetSuite and Aplicor.

SAP has become the ERP software industry leader for the Global 2000. The two problems with this achievement are that there are only 2000 customers in this list (thereby requiring SAP to move down stream to continue growth - the subject of a future blog post) and these customers typically operate with a multitude of remote subsidiaries, divisions or lines of business in a hub and spoke model. SAP has for years encountered resistance in getting the much smaller remote operations to buy off on the mammoth application used by the parent company. Historically, the middle market ERP applications such as Great Plains and Sage have better satisfied the remote operations and even created packaged integration's to SAP to better promote their ability to fill the void. However, the use of non-SAP onsite ERP software in these instances has really not been much more than a trickle - and certainly has not been viewed as a competitive threat by SAP. However, since the introduction of SaaS the trickle has escalated to a wave. Actually a number of waves. Salesforce.com was clearly the first wave, and now NetSuite and Aplicor are following and accelerating SAP's customer erosion. The SaaS vendors have gotten SAP's attention as a significant competitive threat and have caused the risk-averse giant to act.

SAP's most significant obstacles for BBD are enlisting a quality VAR (value added reseller) channel, convincing a skeptical middle market that the application is easy to use and doesn't come with the feared SAP complexity, competing with more experienced and focused SaaS makers, and preventing the on-demand software from cannibalizing its flagship product and revenue stream. While each of these obstacles is formidable, each is also much easier to overcome with the existing customer base and their subsidiaries than with new clients. I expect SAP to move slow and methodical (as the company always does) and in phases, whereby, the hosted ERP software solution first gains traction in the current install base and then matures to grow and achieve new customer acquisitions.

crm blog
SAP Business ByDesign Posted: Friday, December 28th, 2007
Under: SAP
on-demand

Comments: kelly[at]crmgal.com
Trackback: http://www.crmgal.com/sap-bbd.htm

 

Comments
on-demand

SAP's On-Demand Progress Stalled

Kelly - ZDnet is today reporting that SAP Business ByDesign is going to be over a year and a half later than the last proposed delivery date (and probably even later than that) - apparently the product is having massive problems and will not be released before the end of 2009. I know from your prior post you thought the on-demand CRM and ERP product would be here in 2008. Any more thoughts?
Posted April 29, 2008 by Gary Hobnof

on-demand

I've read a few stories on this. It appears SAP's hosted enterprise software solution was short on capabilities and woefully short in terms of performance, scalability and reliability. The hosted product is seemingly no where near ready for general availability. I must admit I'm disappointed and was probably taken by SAP's claims that they finally found software as a service religion. This seems to support the case that SAP isn't so motivated to offer on-demand or cloud computing solutions - other than as a transitionary strategy intended to migrate hosting customers to their on-premise products. I suspect they will eventually release an on-demand ERP system, however, I'm also suspect it will be a non-competitive product used as a defensive tactic to stop the erosion of their flagship on-premise systems.
Posted April 29, 2008 by Kelly

on-demand

SAP's on-demand erp software delay is official according to the words of the company's CEO who simultaneously indicates the SaaS product needs substantive rework and SAP is slashing staff and budget for this line of business. The new projected delivery date is a minimum of 12 to 18 months out, however, when mission critical software applications are projected that far out, especially when they were already suppose to be delivered by now, they have a history of never being delivered. I expect SAP's on-demand software initiative to either be cancelled all together or replaced with an acquired product.
Posted May 1, 2008 by Samuel Admitz

 

sfa
sfa
Home|Categories| Archives | About | Contact| Site Map|Terms
sfa