SAP attack

More financial services and government organisations are now reaching for ERP options according to IDC, but SAP says they are not looking for traditional core enterprise solutions.

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By  Colin Edwards Published  March 26, 2006

|~|kraus200.jpg|~|Kraus: 100 days or less to implement SAP|~|SAP and SAP Arabia have been putting their heads together to plan the year ahead and hopefully better the successes they enjoyed in the region last year.

Bernd Kraus, managing director, SAP South East Europe and Middle East, Sergio Maccotta, managing director SAP Middle East and Phil Blower, sales director SAP Arabia, locked themselves in a room for a day last month to thrash out how best to address the emerging markets of the region.

At the high end, they have opted to try and break Oracle and Microsoft's dominance in the public and financial services sectors; for the mid-market they are focusing on vertical solutions driven by an enlarged partner eco-system; and for existing customers, it sees new features such as expanded analytics and planned integration with Microsoft Office - SAP's Mendocino project - as the means of helping them derive extra value from their SAP deployments.

"The public sector is going to be a huge focus for us," says Blower. "SAP has had major achievements in this sector globally, but not here in the region. This is partly due to the fact that the public sector hasn't done that much implementing yet. It's done some basic things and we think we can bring more advanced offerings to this market."

While acknowledging Microsoft's and Oracle’s strong presence in the sector, Blower contends they are only in core areas such as finance and HR. "They're not out there enabling the 'business' part. That's what we're focusing on."

Citing an example of this 'business' focus strategy, he talks about the defence industry and how, traditionally, ERP has meant being able to do basic accounting and basic procurement.

"Our solution starts with the purpose of a defence organisation - and that's to deploy and supply the troops in the field. So we start there and design a solution that enables that. Of course it includes procurement, finance and back office, but our solution starts with what you need to do from a 'business' sense, if I can use that phrase in connection with defence."

He is looking to do the same in the financial services arena, building on the company's regional successes in this sector last year. "We see a large opportunity in that area, but again for more specific solutions such as contact centre CRM, Basel II compliance, and analytics. We're not looking so much at core ERP here, because for a bank the general ledger is not a big issue. What they want is something that answers their questions: how do I get to my customers? How do I manage my risk? So the business opportunity for us is helping banks address these areas," he says.

IDC programme manager for European enterprise applications, Bo Lykkegaard, commenting on a recent report that puts SAP's European market share above 40%, is reported as saying non-traditional ERP users are reaching for ERP options because they are becoming easier to deploy. He says service-oriented architecture (SOA) platforms and pre-integration reduce complex barriers that inhibit ERP adoption. ||**|||~|blower200a.jpg|~|Blower: The public sector is going to be a huge focus for SAP.|~|Regionally, SAP sees the reduction in the deployment complexity of its own solutions as being key to helping it break into the mid-market - a market it has been targeting for some time, but with limited success. It is now taking another tack.

"SAP is really focusing on the so-called SME market, we have been doing this for a year, but it might not have been as widely recognised as we would have liked so we changed our strategy," says Maccotta, adding that the focus of this change has been on working more closely with its partners.

"If you speak about this SME market, you're talking about volume and if you’re doing volumes you can't do it on your own. You have to do it with partners. So a key to success is teaming with partners," he says.

Long and complex deployments of ERP have been barriers to entry to the mid-market in the past, but Kraus says SAP has addressed this by developing baseline solutions with a defined product scope and a defined implementation scope.

"Two things you have to have in mind as far as implementation is concerned. One is to come with a defined scope. This will limit the implementation time. You also have to have the right business model for the partner whereby the partner makes money from selling licences and not only from a long implementation project," says Kraus.

"This is why we are saying to the partner that it's important to show the market that SAP is not complex and doesn't take long to deploy. It is the other way around: you can implement very quickly," he adds. A defined scope implementation should take less than 100 days to deploy, he says.

The third prong of its future strategy is developing its 200-strong customer base in the region.

"Our growth plans, while including new opportunities and new markets do not exclude our large customer base. We can provide even better solutions for managing the business," says Kraus.

This focus is includes helping users maximise their existing IT investments by providing the means to integrate what they have already developed in the past into what Kraus calls "a unique IT solution".

Supporting these plans are enhanced features and additions to the SAP suite such as the recently-launched improved analytics solution with improved graphics to aid decision making.

There is also Mendocino, the joint development between Microsoft and SAP that integrates Microsoft Office with SAP's back-end software to enable users to address specific business functionalities that are part of the SAP processes from the Microsoft product.

"This gives the chance to any company using a SAP solution to reach the far end of the company through a product that is highly available in each corner of the company," says Kraus.

Shai Agassi, executive board member, SAP AG gave details of Mendocino at Cebit last month. Acknowledging that MySAP portal did not appeal to everyone, Agassi said people prefer to retain their current user experience.

"Our focus is to empower all employees, not just a select few, by allowing them to effectively tap into and leverage the data that resides on their SAP and non-SAP systems. SAP believes that people like their current user experience, but want business process context to be part of it," he said.||**||

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