Today, SAP announced a tiered support offering which reinstates Standard Support as an option, in addition to the Enterprise Support offering that SAP put in place in July 2008. This announcement should help to defuse a contentious battle that has played out over the past 18 months, where customers pressed for SAP to reconsider its phased-in migration to higher-priced Enterprise Support.
SAP held a carefully orchestrated product launch event for Business Suite 7 in its global marketing headquarters in New York on February 4, 2009. I had the privilege to attend this event, along with a cadre of other industry analysts, investment analysts, press, and industry influencers, as well as key partners and customers. The 2 hour program featured presentations from senior SAP executives, a product demonstration, and a Q&A session that included CIOs from 3 large SAP customers – IBM, Roche and Colgate-Palmolive.
Microsoft announced today that it is discontinuing the Microsoft Office PerformancePoint Server product. The business performance monitoring and analytics capabilities of PerformancePoint will be bundled into the SharePoint Server enterprise license (CAL) going forward, and no longer sold separately. The planning and budgeting capability of PerformancePoint will see a midyear enhancement that is already in the works, and then put into support mode. Existing PerformancePoint customers will receive support on these products for 10 years. Another element of the announcement is the return of FRx reporting and forecasting capabilities to the Microsoft Dynamics business applications group.
After investing heavily in the development and launch of PerformancePoint over the past 3 years, it is a major shift in strategy for Microsoft to essentially kill off the product initiative. Its rationale is that the goal is to make business performance monitoring and analytics pervasive across the enterprise, and SharePoint is the best vehicle to carry this functionality. Microsoft expects that bundling these capabilities at no additional cost within the SharePoint enterprise license will accelerate sales of SharePoint, including upgrades from the standard license. Planning, meanwhile, is seen as a Finance desk application that is not part of the SharePoint strategy.
Today’s announcement of the promotion of Leo Apotheker to co-CEO of SAP AG signals an orderly transition of command as current CEO Henning Kagermann’s contract expires in May, 2009. Mr. Apotheker has clearly been heir apparent since Shai Agassi’s departure a year ago. Although SAP put a positive spin on his sudden departure, evidently Mr. Agassi was not next in line for the job.
Mr. Apotheker, a 20 year veteran with SAP, has served as head of worldwide sales and most recently as Deputy CEO. While the practice of co-CEOs could be problematic in some environments, SAP has done this before as Dr. Kagermann ascended the throne and succeeded Hasso Plattner, now Chairman of SAP’s Supervisory Board. The transition should be orderly and Apotheker is well-suited for the job.
Additional changes within SAP’s Executive Board were also announced in the same press release. Jim Haggeman Snabe, Bill McDermott and Erwin Gunst were promoted to the Executive Board. Snabe will manage product development for both the SAP Business Suite and Netweaver. McDermott will take over responsibility for worldwide sales. Gunst, the current head of EMEA operations, will become the company’s first Chief Operating Officer. The need for a COO signals the growing complexity of the business in maintaining controls over acquired businesses (e.g., Business Objects) and new products and business models (e.g., Business ByDesign). Snabe and McDermott represent new blood on the Executive Board as well, rising stars that have done well in their respective areas.
SAP made a major departure from its "tuck-in" strategy with the October 7 announcement of its agreement to acquire Business Object for 4.8 billion (Euro). On the surface, the deal makes sense from the standpoint of marrying business intelligence (BI) technology with ERP applications. The deal is surprising in the sense that SAP has long insisted that its growth strategy is organic and that it would not make major acquisitions to gain market share. The Business Objects deal is by far the largest SAP acquisition to date, comparable in scope to Oracle’s acquisitions of PeopleSoft, Siebel and Hyperion.
SAP's official announcement of Business ByDesign, formerly known as A1S, targets midsize companies looking for relief from complicated ERP implementations and support. Some key points regarding the Business ByDesign (BBD) announcement:
• The solution will be provided as a hosted, subscription service
• A dedicated website enables a try-before-you-buy sales approach, where customers can rapidly configure a demo system that reflects their needs
• Pricing is set at $149 per user, per month, with an nominal charge for self-service users
• The scope of the offering is comprehensive, spanning finance, HR, supply chain, supplier relationship management, CRM, project management and compliance management.
• SAP has 20 live early adopters and another 20 that are actively engaged in rolling the solution out. The initial emphasis is on US and Germany, with expansion to more markets in 2008 and 2009.