SAP: The future is SaaS

John Wookey, the executive hired from Oracle last November, could hardly have been more clear when he spelt out the future of SAP and, by implication, the whole software industry at the OnDemand Europe conference in Amsterdam on 10 June.

“On-demand is the next stage in applications development, the next stage in technology – and I think it is important to hear SAP say that the future of the company is tied to successfully develop and market on-demand. SAP believes in on-demand and so does the SAP Board,” he said.

Despite SAP’s troubled efforts to develop its SaaS products, Wookey insisted the company was a “leader in applications and Business Intelligence and we will become leaders in on-demand as well.”

The former Oracle exec insisted he was “not saying this out of arrogance, but out of a logical idea: If we want to serve our 86,000 customers the best way possible, we can only do it by making an incremental investment and becoming the leaders in this space.”

With established SaaS vendors such as and Netsuite building up their product line to approach a suite-type offering, Wookey said, “we will not try to be the best on-demand vendor in the open market but will focus on the need of our installed customer base”.

He also insisted SAP would “leverage the strengths the business suite already offers”.

These include a singe solution architecture, which offers integrated information, which is defined by the customers, integrated business processes and that any customisation is only made once for the entire technology landscape “no matter if on-demand or hybrid”.

Wookey highlighted a problem for traditional ERP vendors such as SAP and said software as a service offered a solution. “Customers do not always want to make new investments to the Business Suite and change to a new version to solve a new business problem.

An on-demand solution solves defined problems like contract lifecycle management, expense management, CRM, e-sourcing – and it provides a nimble way to solve this problem.

"If you have lots of different systems from different vendors you are somehow back to the best-of-breed problem – but if you solve this through a single solution architecture you get behavioural consistency which means that all business decisions you made and encapsulated in the suite are essentially exposed also to the on-demand applications.”

Customers do not have to re-define anything from the suite, he said, that is the job of SAP’s software engineers and coders.

By mid-2010 the company will bring some of its partners into the programme and allow the m to offer additional functionality to the on demand offering.

Wookey also held out the prospect of using social networking technology in conjunction with the business suite to speed up business processes and improve decision taking.

There are already sales teams who use Facebook to manage their daily work Wookey noted. SAP needs to find ways to better integrate Facebook into its solution, he said, “and on-demand is the only area where you get fast enough cycle times to iterate jointly with your customers until it works.”

On-demand is also likely to play a key role in supply chain managemen said Wookey. SAP has powerful on-premises products, but “if you think of the supply chain as a network which tries to optimise around joint planning, manufacturing, logistics,” the non-demand can create a “centralised space” for this to occur, said Wookey.

Copyright © 2009 IDG Communications, Inc.

8 highly useful Slack bots for teams