SAP Business Suite 7 got the full media treatment; the pre-launch hype, the videos, webcasts, customer testimonials and loyal partner sound bites. But how significant is the release and is SAP in front of or behind the curve? Gary Simon, FSN’s managing editor looks at what the release has to offer.
Faced with a rapidly slowing economy and falling interest in large ERP suites SAP very much needs to pull a ‘Rabbit out of a Hat’. For the foreseeable future companies of any size and hue are unlikely to commit to large scale projects, with long implementation timescales and a high price tag. So positioning SAP Business Suite 7 as a release which, “Helps customers respond quickly to economic downturn” is incontrovertible. It is also consistent with SAP’s efforts over the years to shed the expensive BPR (business process re-engineering) tag that worked in the nineties but became a marketing millstone as it entered the new millennium.
BPR may have been consigned to history but business processes are absolutely germane to the latest SAP offering. At the heart of the launch is the recognition that accounting and business systems which promote application silos are a severe impediment to business productivity and competitiveness. In effect application silos reinforce organisational or functional silos and, where you have silos, you inevitably have boundaries – and it is these that act as formidable barriers to business processes.
Put simply, the networked economy does not respect boundaries. In the future, companies that fall foul of compartmentalised processes will be punished by the market, increasingly anxious for rapid response and little patience for error and delay.
In an interview, SAP Executive Board Member, Jim Hagemann Snabe, says, “We had the notion of modules – just very big modules. The traditional suite was a combination of different applications, ERP, CRM, SCM and the aggregate was the suite.”
“We’ve taken a new approach to modular thinking. Instead of looking at it from an IT point of view and silo-ing different applications we took a look at the business and tried to define end-to-end processes, called ‘value scenarios’ that help companies improve their business. These often go beyond the boundaries of the application silos and so the modular approach in the business suite is really about finding the right grouping of functionality that fit a specific end-to-end process need,” he continued. “So we span the application boundaries, bring information together and focus the end user of line of business owner on the business rather than the IT.”
Developed closely with SAP’s customers and partners, value scenarios in the new SAP Business Suite include, “inspired shopping experience”, “integrated product development” for discrete manufacturing industries, “collaborative demand and supply planning” for high tech and consumer products companies, and “integrated sourcing and procurement” for all industries.
With the value scenario “inspired shopping experience,” SAP says that retail CEOs—along with their lines of business management—will have the ability to better understand shoppers, anticipate their needs and shape the customer experience, as well as more effectively leverage point-of-sale operations, loyalty management, workforce management and product assortment and pricing.
But how new is the end-to-end process idea? Hagemann Snabe, says that it is “a unique, new approach”. This may be true for SAP and the named ‘value scenarios’ are unique, but the idea of working across functional silos is certainly not new. Microsoft has been working feverishly with this concept in the mid-market for a number of years following its acquisitions of Navision and Axapta.
Neither is the historic ‘application view’ of life an exclusively IT phenomenon. Task oriented finance professionals have been comfortable for many years with the departmental approach which suits the traditional accounting perspective, for example, accounts receivable, credit control, purchase ordering etc.
So is SAP saying anything new? The answer appears to be a qualified “yes”. The coalescence of a process oriented view with the industry knowledge is something different. Having ‘value scenarios’ on tap which can be applied in their entirety, or the extent required, adapting if necessary will be valuable. For example, prepared scenarios should speed analysis, reduce consulting input and implementation with all of the cost benefits this implies.
Hagemann Snabe adds, “Our mission is to give process excellence. We do it in two flavours. Firstly we help you save costs by easy consumption of best practices and [secondly], we help you become more agile with better insights and more flexibility to change processes.”
SAP is clearly taking the opportunity of the launch of this product suite to leverage its investment in Business Objects, the business intelligence and performance management business it acquired last year. SAP says that the SAP BusinessObjects portfolio will allow users of SAP Business Suite 7 to achieve better insight using selected analytics capabilities, but at the launch details were sketchy.
Naturally, SAP’s business partners (what they call their ecosystem) are already lining up to help companies implement the new suite. Atos Origin, Capgemini, IBM and Wipro have all become launch partners for SAP Business Suite.
The question now is whether customers will also line up to buy SAP Business Suite 7? In better economic conditions the answer would be automatically “Yes”. The process driven approach is very much where business software has been headed and needs to go. The fine judgment is whether the offering is compelling enough in the current climate to make customers commit. That’s a difficult one to call.
