Posts Tagged ‘SAP’

SAP Chases Constant Cloud Customers By Albert Pang

Wednesday, February 22nd, 2012

The completion of SAP’s acquisition of SuccessFactors raises as many questions about the future of SAP as there are about its past.

One of the key questions is when and how many of SAP’s 183,000 customers would migrate to the Cloud, something that SuccessFactors and its peers have embraced with gusto and benefited handsomely from it as a result.

The obvious answer is that with 14% of SuccessFactors customers, representing nearly 500 organizations, already using SAP applications, it’s just a matter of time that many more SAP customers will choose SuccessFactors as their onramp to Cloud deployment either as a matter of necessity or convenience.

For anyone interested in using SuccessFactors to improve their eRecruiting, performance management, succession planning and even Cloud-based Core HR business processes, SAP will position SuccessFactors as the front and center of its Cloud strategy.

SuccessFactors and its Cloud technologies will take precedence over SAP’s evolving Cloud offerings resulting in the shelving of products such as Career OnDemand, according to SAP.

SuccessFactors will also become the designated Cloud model for SAP to sell and deliver HCM products including Core HR and talent management applications. By May 2012 SAP is expected to come up with specific plans to integrate its entire Cloud portfolio with its existing on-premise products.

Lars Dalgaard, CEO of SuccessFactors, is expected to join the powerful SAP Executive Board as its sixth member(the others are its two co-CEOs, CFO, COO and CTO) capable of shaping the future of the company. I would not be surprised that Lars’ real title is the Chief Cloud Officer of SAP.

All these mean that SAP’s $3.4-billion deal to buy SuccessFactors has transformed the company with its Cloud strategy taking the center stage and evolving from context to core.

Will Customers Buy It?
SAP’s emphasis on the Cloud comes at a time when enterprise applications customers are also transforming themselves in a trajectory similar to moving from Casual Cloud to Constant Cloud.

As Rentokil Initial, a $4-billion business services company, and a growing list of other organizations are favoring Cloud-based applications over on-premise software, the implications for vendors like SAP are significant. Since 2007 Rentokil Initial, which employs 66,000 around the world, has drastically reduced its investment in on-premise applications specifically those from Oracle following increased adoptions of Cloud systems from Salesforce.com to Workday.

Similarly hundreds of SAP customers like ConAgra Foods, Hilti, and Kimberly Clark have been using SuccessFactors for years suggesting that their spend with SAP would have increased had the vendor provided an equally compelling Cloud-based option.

As a result, SAP’s positioning SuccessFactors as the front and center of its Cloud strategy is no longer a matter of convenience, but rather a necessity for the vendor to win in the future.

That brings us to the issue of using SAP’s track record to determine whether the SuccessFactors deal and the current Cloud push would be a ringing success. One is tempted to equate SAP’s current Cloud obsession with its foray into eCommerce(remember SAP Markets?) during the Dot Com boom in 2000. Every software vendor was doing it then, as they are now.

After the Dot Com bust, SAP quickly reverted to its core business of selling big ERP systems. Its subsequent acquisitions including Frictionless Commerce for its on-demand sourcing applications, Triversity in retail, Crossgate in B2B integration and more recently the deal to invest in SAF AG for forecasting and replenishment have been made to augment its sales pipeline. Their impact has been modest at best.

Business Objects and Sybase were bought to help SAP shore up a specific product category. The former has made a stronger impact than expected and one could argue that SAP’s recovery from the deep recession would have been held back longer without the help of the business intelligence products from BusinessObjects. On the other hand, it’s too soon to gauge the ready acceptance of Sybase database among SAP’s installed base despite growing signs that Sybase is being fully integrated into SAP’s sales operations.

In short, most of SAP’s past deals have been more opportunistic than cataclysmic. The question is whether the inclusion of SuccessFactors will become the catalyst to shake SAP at its core. Today SAP is much more diversified with its fledgling in-memory agenda as well as the ambition to become the fastest-growing database company, not to mention its all-important business analytics strategy.

Even with a stated goal of building a €2 billion Cloud business by 2015, compared with €201 million from the combined SuccessFactors and SAP’s Cloud subscription and support revenues in 2011, the target amounts to about 14% of SAP’s applications license and maintenance revenues if they continue to grow at 10% annually through the projected period.

Still the steeper the ramp of its Cloud revenues, the more likely its license and maintenance revenues would be eroded. In the coming months, any unexpected shortfall on either could wreck havoc to its stock price as much as to its ability to target Constant Cloud customers, while easing its dependence on on-premise business.

Perception, duly noted in the Dot Com era, now matters more than reality. The mere act of SAP’s throwing its weight squarely behind the Cloud and thusly reconfiguring its business model is akin to what Amazon.com was aiming to achieve by turning the world of retailing upside down.

The latter has done it with conviction and clarity and I am eagerly awaiting the former to do the same.

Send comments and questions about this blog and how we can help meet your enterprise applications research needs to info@appsruntheworld.com.

Tags: , , ,
Posted in ERP, HCM, Oracle, SAP

Salesforce.com Steers Social Enterprise Movement Amid Cloudy Outlook By Albert Pang

Thursday, September 1st, 2011

With growing signs of leading one of the most important segments of the enterprise applications market, Salesforce.com embodies the disruptive power of Cloud-based delivery of sales, marketing and customer service software.

At the same time, Salesforce.com is increasingly using its scalable platform to reach beyond its core competency of selling customer relationship management(CRM) applications by unleashing a floodgate of applications developed by its ISV partners to help customers build the next-generation Social Enterprise, a movement that is designed to engage more users, allow for easy and real-time collaboration across different roles, and ultimately yield tangible results to their bottom line.

Social Enterprise Soars Into Space
This week the power of Salesforce.com is evident at the Dreamforce event where it is pushing into new Social Enterprise frontiers in a series of announcements including an equity investment in ERP vendor Infor in order to help drive back-office data to the new era of real-time collaboration among salespeople, customers as well as those involved in non-sales functions like finance, production and supply chain management.

Similarly Salesforce.com has invested in startup Kenandy, a Cloud-based ERP vendor founded by Sandra Kurtzig, a guru in manufacturing applications who is expected to be instrumental in helping Salesforce.com reach not just regular salespeople, but also production supervisors and quality managers of asset-intensive companies from Siemens to Toyota.

In addition to the investments, Salesforce.com introduced a new portfolio of Social Media-infused tools and services including Chatter Now for instant messaging, Chatter Service for self-service knowledge gathering and Data.com for enhanced crowd-sourcing with Dun & Bradstreet’s proprietary business data. All these new offerings will start leveraging HTML5 to bedazzle users with an attractive frontend ideal for mobile device viewing.

During the week-long Dreamforce, the common catch-all phrase from Salesforce.com executives is that Social Enterprise has become the “rocket ship’’ that will propel the business of anyone associated with the vendor’s platform and applications strategies to stratospheric levels. However the sunny outlook is clouded by a host of issues that Salesforce.com needs to address in order to fulfill its vision of taking its stakeholders along for the rocket ship journey.

There lies the paradox of one of the most successful software companies that has transformed the CRM applications market for more than a decade. Yet it has failed to make a profit consistently, while its recurring revenues from its existing customers appear to have stalled.

Salesforce.com Dethrones Siebel
During that period, Salesforce.com dethroned the former champion of CRM software Siebel by reinventing the market segment with the innovative use of the on-demand delivery model, or for that matter redefining how customers should be served in the new era.

For its part, Siebel scored a series of home runs with its integrated sales force, marketing and customer service automation applications until it was weakened by tumbling sales following the Dot Com bust. Finally Oracle acquired Siebel in a $5.8-billion deal in 2005.

Unmistakably Salesforce.com is in a stronger position than Siebel at any point in its history. When Siebel was acquired by Oracle, it only had fewer than 5,000 customers. Today Salesforce.com has more than 100,400 customers. And there are thousands more from its recent acquisitions of Heroku and Radian6 that have shored up its capabilities in Web development in multiple programming languages and social media applications.

As the following table shows, Salesforce.com was the No. 1 CRM applications vendor worldwide in 2010, edging past Oracle and SAP and others still reeling from the last recession. Salesforce.com, which led the $15.8-billion market with nearly 10% share last year, never skipped a beat even in the depth of the recession by picking up more customers and recurring revenues than its competitors.

In a survey of more than 1,000 IT managers, executives and CIOs conducted by APPS RUN THE WORLD this summer, Salesforce.com was found to be the primary Sales Force Automation systems at more than 12% of the surveyed companies – consisting of mostly enterprises with more than $500 million in revenues. In many cases these companies have positioned their Salesforce.com system as the primary CRM engine displacing Siebel that has laid dormant after years of under-utilization or failed implementations. For example, Salesforce.com stands side by side with Siebel at a 6000-person media company acting as a customer-facing engine that sits between its ad servers and the back-end Oracle ERP to support its online advertising business.

Additionally Salesfore.com is on a $2.2-billion annual revenue run rate after posting a 38% jump in sales to $546 million in its latest quarter. During that period, Salesforce.com signed more than 60 deals with each yielding at least $1 million in subscription revenues over the length of the contract. It also signed three $10-million+ deals, plus another $10-million+ transaction following the end of the quarter.

Salesforce.com Faces Considerable Challenges
However, such success stories mask a host of problems with Salesforce.com. By one measure, Salesforce.com gets less subscription revenue per customer than some of Social CRM applications vendors as if they were beating Salesforce.com at its own game because the pervasive nature of their Cloud-based services has translated into bigger subscription sales.

As the following chart shows, Salesforce.com received $1,631 in average monthly subscription revenue per customer in its latest quarter. By comparison, Eloqua, which sells Cloud-based marketing automation applications and is also an ISV partner of Salesforce.com, saw its monthly subscription revenues from its more than 1,000 customers reaching $4,966 in the second quarter of 2011, according to its S1 filing in advance of its initial public offering.

Social business applications vendor Jive, which is also planning its own IPO, did even better with monthly subscription revenues averaging $7,874 from its 635 customers during the same period, according to its S1 filing.

Despite a steep rise in its early years, Salesforce.com’s monthly subscription revenue per customer has been stuck at $1,400 level over the past few years.

What that suggests is that Salesforce.com’s continuous growth in subscriber base has not translated into bigger wallet share among its customers. The lingering recession could have played a role behind some companies reducing their Salesforce.com expenditures as part of their overall cost-cutting moves. In addition new services like Chatter have been bundled into its CRM sales without incurring additional revenues. Another reason is that the new wave of social CRM apps vendors are beginning to undermine Salesforce.com’s mind share and market positioning because the newcomers are considered easier and more affordable to use on a large scale.

Jive, for one, is said to have more than 15 million users running its products. Cloud-based vendors from Cornerstone OnDemand to SuccessFactors are touting six million and 15 million subscribers , respectively. Salesforce.com, which has not publicly revealed the number of users in recent years, is estimated to have fewer than three million users.

Salesforce.com will face stiffer challenges than ever in getting its products into the hands of potential users. In the same survey that we conducted this summer, one of the biggest electronics makers has decided to adopt Eloqua as its primary marketing automation system, despite the fact that it also uses Salesforce.com, Microsoft Dynamics CRM and Siebel to automate its sales function in different parts of the organization.

Aiming to boost utilization of its software throughout an organization, Salesforce.com this week introduced a new social enterprise license agreement that allows every employee within its customers to have unrestricted use of its products.

It is not clear whether such a program would help address another big problem, which has to do with the inability of Salesforce.com to make a decent profit even though its products have been on the market for more than 10 years.

The cumulative earnings(net income after tax) for Salesforce.com since its founding in 1999 amounted to $173.4 million, or 2.7% of its aggregated subscription revenues of $6.4 billion. In the first half of its fiscal 2012, it lost $3.7 million following a series of acquisitions. By comparison Oracle posted $3.2 billion in earnings, or 30% of $10.7 billion in total revenues in its last quarter of fiscal 2011. SAP posted $851 million in profit after tax, or 23% of its product sales of $3.7 billion in the second quarter of 2011.

One of the reasons behind Salesforce.com’s spotty earnings track record has to do with its heavy sales and marketing spending, which represented half of its revenues in its latest quarter. Oracle spends 20% of its revenues on sales and marketing. Intuit, which sells both packaged and on-demand ERP and business management applications and is twice the size of Salesforce.com, spends only 29% on sales and marketing in its latest fiscal year.

There are signs that Salesforce.com is making an effort to address its high sales and marketing expense ratio by working closely with its ISV, reseller and systems integration partners. At this week’s event, Salesforce.com announced a $50 million fund to help its consulting partners expand their capacity, thereby lowering the costs for the vendor to sell and service its customers.

However these new programs will take time before they can have a positive impact on its financial results.

Salesforce.com To Shift Strategies
In the meantime, there are near-term measures that it can do to remedy the situation, while positioning itself to become one of the biggest beneficiaries of the Social Enterprise movement.

For one thing, sales force automation has become a losing proposition when much of the selling is done over online commerce and end-to-end order management. The rise of social media points to the fact that its future is tied not to salespeople using Salesforce.com to better connect with their customers, but rather harnessing the collaborative power of all employees(sales, marketing, R&D and support), partners and even customers themselves working with tools like Chatter Now to address specific customer requirements.

That’s why Oracle has spent $1 billion on its recent acquisition of ATG as well as additional resources to promote the Distributed Order Orchestration strategy that is at the heart of its Fusion Applications.

While Oracle may have lost many Sales Force Automation deals to Salesforce.com in the past, the real value of the Siebel assets lies in hard-to-replicate expertise in such verticals as pharmaceuticals, financial services and communications. Again Salesforce.com is acknowledging that its future will be based on how relevant its solutions will be in the eyes of these vertical industry users and it’s working closely with its channel to address that.

The last thing, or perhaps the most important move, is for Salesforce.com to turn Chatter into a full-blown open social network, broadly expanding its reach to tens of millions of users. Currently Chatter, which is being run as a private social network for businesses, has been adopted by 100,000 organizations. However it is not clear how defensible is the positioning of Chatter when formidable players from FaceBook to Google allow segments of their hundreds of millions users to create business-class private social networks.

If it fails to thwart such threats, Salesforce.com may need to consider the unthinkable by buying a complementary social network like LinkedIn. At a market cap of more than $8 billion, it would be an expensive purchase.

Still the window of opportunity is narrowing and Salesforce.com may need every rocket ship component that it can find in order to sustain its leadership in the CRM applications market and become the biggest Cloud service provider behind the making of the new Social Enterprise.

Let us help you better understand the positioning and market shares of CRM and Social Enterprise vendors like Salesforce.com by emailing us at info@appsruntheworld.com.

Tags: , , , , , , , , ,
Posted in Oracle, Salesforce.com, SAP

An Unconventional Approach From SAP To Score Industry Wins By Albert Pang

Tuesday, July 19th, 2011

The conventional wisdom is that SAP has been particularly successful selling into heavy industries. After all, it got its start in the 1970s developing accounting and production management applications for the likes of Dow Chemical, John Deere and other stalwarts in oil and gas and industrial equipment.

Things have changed considerably through the years. At a show of its ability and unique value proposition in serving services industries – along with its formidable presence in chemicals, manufacturing and other asset-intensive verticals – SAP is taking the conventional wisdom to task.

By aligning its newly developed and acquired technologies with the needs of different industries, SAP is seeking to change public perceptions while reaffirming its commitment to creating highly-differentiated solutions for their specific functions.

At a recent full-day analyst briefing, SAP detailed its latest industry strategy and future roadmap covering dozens of upcoming products including real-time risk reporting for banks, electronic medical record systems accessible from mobile devices for health practitioners, and demand planning and warehouse analytics for retailers. The event underscored SAP’s unwavering support for industry-specific solutions that harness new and existing technologies to deliver results in a fairly unconventional manner.

Challenging the widely-held assumptions that its implementations are long and costly, SAP is instituting rapid deployment options that result in fixed price and fixed scope projects due for completion in a matter of weeks. Since September 2010 SAP has built 40 of these Rapid Deployment Solutions with signing of more than 200 contracts including many that are based on industry-specific requirements such as manufacturing integration and intelligence for batch manufacturing.

And if customers prefer not to implement these systems in-house, SAP is positioning its on-demand offerings – namely SAP Business ByDesign – to meet the Cloud-based requirements of its target audience across different industries. For example, 45% of Business ByDesign customers and prospects can be found in the professional services vertical with the ease of on-demand delivery as one of their biggest reasons selecting and evaluating the new software from SAP.

HANA, Mobile, Analytics Permeate Industry Solutions
SAP’s industry focus has been bolstered by the additions of its new assets. SAP HANA, which takes advantage of tumbling hardware costs and the latest compression technology that facilitates in-memory computing, aims at boosting price performance of its applications while rendering the use of local databases obsolete.

Similarly SAP is making good use of advanced mobile technologies that it acquired from Sybase to shore up its offerings in such areas as mobile banking, EMR and couponing redemption at check-out stands.

In addition SAP is wrapping business analytics – led by major new releases such as SAP BusinessObjects Business Intelligence 4.0 and Enterprise Information Management 4.0 – around industry-specific solutions. For example, SAP applications for the telecommunications industry are designed to offer relevant data and strategic insights to users by role with ready access to network performance, cost and profitability analysis, and customer sentiment and monitoring dashboard.

None of these new products, or SAP’s renewed industry efforts, matter if its field operations and partners fail to draw collective strengths from each other in order to achieve win-win outcome for both. And SAP is quick to acknowledge the steep learning curve involved for its salespeople, or its fledging on-demand ecosystem for that matter. Once again SAP is relying on an unconventional approach to make its industry strategy a resounding success.

To that end, SAP has appointed two executives to assume joint responsibility of its industry solution portfolio, which now amounts to nearly half of its revenues.

By pairing up product guru Kerstin Geiger, a 14-year company veteran steeped in manufacturing processes and solution development, with customer advocate Jeff Harvey, who has held a number of sales and customer care management positions since joining SAP in 2002, the vendor is replicating its dual-CEO structure at the go-to-market level in order to strike the right balance between product innovation and widespread customer acceptance.

As its executives reiterate SAP’s industry value that bridges enterprise applications and vertical solutions to drive user benefits, the gating factor is whether the unconventional approach is capable of not just confounding the skeptics, but also exceeding general expectations by winning customers even in certain services industries where SAP traditionally has not been considered a serious contender.

To look up SAP’s track record of securing and winning market shares in different industries, register and access our library of Vertical Market Reports on www.appsrun.com or send inquiries to info@appsruntheworld.com for custom data cuts on SAP and its closest competitors.

Tags: , , , , ,
Posted in SAP, Verticals

Business Analytics For the Masses By Albert Pang

Monday, June 27th, 2011

There has been a lot of talk about the merits of business analytics, which is a cut above what business intelligence can do, but we will get to that in a minute. What matters is that we are at the tipping point of a new way of gathering intelligent data, aggregating and cleansing loads of them, and finally making sense of the obvious and not-so-obvious insights for planning and forecasting purposes through role-based reporting.

For more than a decade, much of the growth of the business Intelligence software market has been about helping large organizations manage massive amounts of data, querying them with data-mining tools and generating sophisticated dashboards that show visually stunning results ranging from complex key performance indicators to simple-to-understand metrics.

The Big Data phenomenon is just that. After years of collecting petabytes of data, many large enterprises now have access to anything they want to know about their customers. Apple is said to be beefing up its storage capacity to the tune of 12 petabytes in order to manage the video download of its customers.

Simultaneously these multinationals are unleashing a torrent of data that none of their customers can decipher intelligently. Recently a CIO spoke of the feed for its business data subscribers now reaching 700,000 updates per second, an output that is beyond human capacity to absorb, let alone doing anything with it.

SMBs Embrace Business Intelligence
Meanwhile, small and midsized companies have become the next battleground for business intelligence software vendors vying to bring enterprise-class analytics and reporting tools to the masses, an outcome that could have multiplying effects to the applications market.

As shown in the following graphic, SAP, which has already held nearly a quarter of the $7-billion BI market worldwide, is making that force multiplier more evident.

Worldwide Market Shares of Top 5 BI Vendors, 2009-2010

Earlier this month SAP introduced SAP Crystal Server 2011 and the 4.0 release of SAP BusinessObjects Edge Business Intelligence. The products, which can be purchased as a bundle or separately, offer improved data search, drill-down and dashboard viewing capabilities. Additionally SAP BusinessObjects Edge 4.0 extends support to mobile users, while its Event Insight function allows SMEs to monitor business scenarios in real time and respond to market changes accordingly. Its text data analysis feature even allows customers to analyze what’s being said about their products and services on social media sites such as Facebook and Twitter.

Such enhancements are instrumental in helping small and midsized companies make smarter decisions in response to shifting market conditions including whether and when they should adjust their inventory levels, channel promotions or marketing expenses based on real-time data. By leveraging SAP’s on-demand delivery model, these users can either implement these BI solutions without the help of their IT departments or proceed with these projects in a compressed timeframe by taking advantage of SAP rapid deployment options.

In addition to selling the products directly, SAP has been working with a growing army of OEM and reseller partners to make BI as ubiquitous as possible. For example, Syspro, which has secured a base of 14,500 mid-market customers in such verticals as consumer and packaged goods, life sciences and manufacturing, is incorporating many of the latest dashboard capabilities from SAP Crystal Server to boost the usability of its ERP applications by making it easier for business users from CFOs to purchasing managers generate tailored reports for their day-to-day responsibilities.

For Syspro, the combined ERP and BI software for functions like inventory management, executive dashboard and what-if scenario visualization has galvanized support for its products, while delivering tangible value for users that now have easy access to real-time information. For example, Honest Tea, a beverage maker, cited its ability to halve its inventory levels because of the availability of such useful information by running the Syspro system.

Pentaho, Tableau, Qliktech Join The Fray
SAP is not the only BI vendor eying the SME market with great interest. Pentaho, which has made its name in the open-source BI marketplace, introduced Pentaho BI 4 Enterprise Edition in June. One of the key targets is non-technical business users who can use the new product to create highly formatted, interactive reports with zero training or involvement from the IT department.

While Pentaho has been used by big organizations like Sheetz and Swissport, it has also attracted hundreds of small and mid-sized commercial customers, not to mention the viral effects on those who have been using its BI products for free at a rate of one download every 30 seconds.

Tableau is another fast-growing BI vendor that has made its name by lowering the barriers of entry with Tableau Public, a free service that anyone can use to create and publish interactive data visualizations to the Web. Since its launch in February 2010, more than 10 million Web pages with Tableau Public data visualizations have been served.

Elsewhere, Qliktech has seen its customer count soaring to more than 18,000 from 13,000 in 2009, after making small and midsized companies a major plank of its BI strategy. Quadax, one of Qliktech’s customers that sells its own software into life sciences vertical, was able to implement the mobile BI product from Qliktech in six weeks and now 110 Quadax users use their iPad to access analysis for managing payer reimbursement metrics and trends from clinical laboratories, vastly improving the quality of data they receive for better support of their clients.

Qliktech also OEMs its BI products to vendors such as Deltek, which specializes in business applications for small and midsized customers including 1.8 million users representing more than 14,500 firms in architecture, engineering and construction as well as government contracting space.

Business Analytics Becomes The Holy Grail
When one tabulates the potential of these vendors and the new and recurring revenues they generate from customers and reseller and OEM partners, the market for business intelligence software is expected to grow from $7.3 billion last year to $10.4 billion by 2015.

But the Holy Grail may well be the business analytics market, which includes not just Business Intelligence, but also features such as enterprise information management for data aggregation and cleansing and enterprise performance management for planning and forecasting.

Moreover SME customers are turning to business analytics to complete tasks like applying analytics to Web front-end in order to deliver role-based reporting. In order for that to happen, more intelligent data will need to be layering on top of the analytics one gets from monitoring eCommerce sites or other customer-facing channels like retail stores. The analytics could become more useful if one can ascertain the impact on inventory, service and staffing levels, all of which will require bringing in additional software features like supply chain, customer relationship, and HR management, boosting the total addressable market for business analytics to new heights.

Instead of a $10-billion market opportunity, the worldwide business analytics software opportunity could reach $30 billion by 2015, according to our latest estimates. Based on the direction that these vendors are headed and the keen interest among small and midsized companies, a user community that has barely begun leveraging business analytics as a competitive edge, the payoff for vendors and other key stakeholders is real and unmistakable.

The question is whether any one has the right formula of delivering smart and high-impact business analytics solutions and tying them together in a neat and attractive package for any business to realize and achieve the predictable and desirable outcome.

Don’t forget to check back for our continuous coverage of the business analytics market. Write to us at info@appsruntheworld.com for any questions about our market sizing reports.

Tags: , , , , , , ,
Posted in SAP

SAP Targets One Billion and One Users By Albert Pang

Thursday, May 26th, 2011

If SAP has its way, its software will reach one billion and one users by 2015. The first billion is SAP’s stated goal, the superfluous but no less important singular user is my addition. Whether it succeeds or not, SAP’s future is at stake.

Before the goal can be reached, SAP, whose software has already been in use by 109,000 customers and hundreds of millions of people, has laid out a series of measures to prepare for and capitalize on the onslaught of new and existing users.

That was evident at the recent SAPPHIRE NOW held at the Orlando Conventional Center, which was configured as a trade show, dedicated theaters, group discussions around conference tables, and new media experiences on a global scale all rolled into one.

One of the narratives of the theme-infused SAPPHIRE NOW was the rise of mobile applications. Sybase, following its acquisition by SAP for $5.8 billion, was spotlighted as the key enabler with the rollout of Unwired Platform 2.0 and the primary mobile applications developer.

Other recurring themes included combining Rapid Deployment solutions with in-memory computing to boost reporting capabilities; leveraging AWS and Azure Cloud Computing platforms under expanded alliances with Amazon and Microsoft, respectively; as well as sustaining customer interest with both on-premise and on-demand offerings including the latest business analytics applications for line of business executives and the revamped Business ByDesign for midmarket businesses.

A Touch of Mobility
Dozens of mobile applications from Sybase, which has become one of the biggest SMS messaging backbones responsible for processing 1.5 billion text messages per day, will start hitting the market in the coming months capable of automating such tasks as workflow approvals for HR processes like employee profile lookup, vacation request and scheduling and time capture. Other mobile apps Sybase plans to release are designed for customer relationship management, travel and expense management and industry-specific functions. A healthcare mobile application on iPad, for example, allows doctors to access records from patient history to medical images.

The quasi-electronic health record application from Sybase, which does not have full-blown scheduling and specialty features like oncology treatment plan, comes amid the EHR push by the US government to help providers defray the costs of incorporating such systems into meaningful use of their daily practices through billions of dollars of subsidized programs that aim to boost quality of care as well as eliminate medical errors and bloated expenses associated with manual systems.

Altogether it represents SAP’s first major foray into developing hundreds, if not thousands with the help of other ISVs, mobile applications that could unite businesses and their customers all revving to tap into the wonders of mobility with easy access to mountains of information at their fingertips.

With sales of smart phones approaching 100 million every quarter(Apple alone shipped nearly 19 million iPhones in the first three months of this year), such mobile applications will become the impetus behind SAP’s ambitious goal of reaching one billion users.

A Momentous Event
Unlike previous SAPPHIRE events where much of the action either took place on the show floor or behind the doors of private meeting rooms, the conference has taken on an added dimension by infusing new media including social networking and live webcasting into everything about the show. Blogs, tweets and Facebook posts about the event reached untold millions of people around the world as they happened.

The command center of the new media strategy sat next to Studio 3 where the Sybase announcement was made. With an air of a NASA control room, hundreds of video servers, laptops and LCD monitors were stacked from floor to ceiling transmitting TV production-quality images to a global audience. The Orlando show was connected simultaneously to four regional events in Europe.

Suffice it to say that the vendor’s positioning SAPPHIRE NOW 2011 to break last year’s record of reaching more than 50,000 people onsite and online was to surpass Oracle Open World, the competing event that drew 41,000 attendees in 2010.

There are legions of customers and buyers who would attend both events and compare their strategies before making their final decisions. Thus the bragging right of who holds a bigger event is symbolically important in an age where the actual number may carry less significance than its underlying implications.

Given the outsized presence of both in the enterprise(what’s at stake is at least 30% shares of the $34-billion worldwide ERP market between them and the future leadership), any purchase decision underscores how enterprises view the future of computing in general.

Oracle, in trumpeting its Exadata database machine, favors high-volume data-processing(we’re talking about petabytes of data here) in a box approach, while SAP gravitates toward in-memory computing, which foresakes reading of data from disks or flash storage and instead keeps the processing tasks, including calculation and planning and data management within the main memory, thus rendering a dedicated database like Oracle obsolete.

Both claim to deliver superior performance. SAP cited an example of pairing its in-memory computing engine with SAP Business ByDesign to handle what used to be considered batch processing of dunning analysis of outstanding account receivable items. Using the in-memory system, the task takes 13 seconds, compared with 77 minutes previously.

Power of A Single User
Which brings us back to the superfluous user, who could be the CFO or CEO needing to pick up a real-time sales report before a board meeting. In fact there are no shortages of executives who would prefer accessing a report on the fly on their mobile devices, rather than asking someone else to generate it for them, let alone waiting 77 minutes for that to happen.

Hence in an age where there is an unlimited amount of information anyone can access, what a useful piece of technology is supposed to do is to help furnish a timely report that is relevant, accurate and in the right context.

Indeed the future of SAP, or any technology vendor for that matter, may ride on that individual who feels empowered by the promise of the technology to help fulfill his/her version.

After all, SAP’s target of reaching 1000000001 users is as symmetrical and symbolically important as factoring in that single user who could make the whole difference in the world.

Feel free to email me at apang@appsruntheworld.com to tell me what you think of SAP, future of computing, or for that matter power of the individual in the digital age.

Tags: , , , ,
Posted in ERP, Oracle, SAP