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SAP Announces SAP CRM On-DemandTMCnet Communications and Broadband Columnist
On-demand may well be on its way to becoming the standard as SAP has announced that it has expanded its mySAP™ to include Customer Relationship Management (mySAP CRM) as an on-demand option. With this announcement coming only weeks after saleforce.com launched its AppExchange On-Demand system, tensions are sure to be high in the market today.
The on-demand solution from SAP is intended for large and midsize companies to manage sales, service and marketing in an easy-to-use solution delivered directly via the Internet by means of a subscription licensing model. The SAP® Sales on-demand solution is positioned as helping organizations manage their customers, contacts and sales pipelines with affordable, simple-to-use and easy-to-configure tools. The SAP CRM on-demand solution targets executives such as the VP of sales, service managers and marketing professionals while also addressing the requirements of the CIOs who require a solution that can capitalize on existing IP investments.
SAP is hoping to exploit its position as being the only provider whose on-premise and on-demand solutions are based on a common architecture, data model and common user interface, providing for a seamless transition that is easy to manage, ensures continuity of data and processes and minimizes change-management costs.
Mary Wardley, VP CRM Applications, IDC was quoted as saying that the software-on-demand phenomenon has broken the purchase-and-usage paradigm broadly for enterprise software but especially in the market of CRM applications. IDC believes that hybrid CRM solutions and coexistence of delivery models are essential for meeting the various needs of organizations. Wardley added that SAP’s entry into this market is an important fist step for SAP, in bringing this delivery option to its customers within the context of an integrated applications environment.
SAP aligned with IBM as its hosting services partner for the first offering of on-demand solutions. IBM is expected to provide safe, secure, reliable and highly-available hosting services. IBM’s Applications On-Demand Platform will power the SAP solution which will automate application hosting and management to provide a scalable and efficient platform for running business applications.
One market industry expert was not quite as impressed with the SAP on-demand solution. Rob DeSisto, vice president at Gartner stated that, “SAP’s initial offering is missing some key functionality required to support moderate to complex sales requirements: 1) quotation management; 2) although it supports hierarchical organization structures, it does not support matrix based organization structures; 3) the ability to generate a product based forecast; and 4) the ability for a sales organization to customize the system to create formulaic fields or add new functional menu items such as a price calculation tool.”
There is also buzz throughout SAP’s competitors that this new offering does not have the breadth and depth necessary to compete in the on-demand field. After Siebel released its on-demand product as an on-ramp to its on-premise system, the company soon found itself swallowed by Oracle. Some may suggest that SAP could be heading in the same direction.
DeSisto did state that the streamlined user interface and a feature to perform ad hoc queries to get quick access to sales data will be clear winners with sales people. But, SAP will have to prove that it can develop relationships beyond the CIO and VP of sales as it has not been successful in doing so with its current CRM offering which is the primary factor for the large amount of SAP CRM shelfware.
User experience will certainly play a key factor in the success or failure of this offering from SAP. The company is offering a free trial and that can either make or break the sale. One key that indicates SAP is committed to this launch is its promise to upgrade the offering every 90 days, which is more aggressive than SAP has been in the past. The company is also supporting a multi-tenant model which requires the execution of the same version of software for every customer. While a necessary component, it could be the feature that inhibits success.
Susan J. Campbell is a contributing editor for TMC and has also written for eastbiz.com. To see more of her articles, please visit Susan J. Campbell’s columnist page.
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