SAPs Platform Strategy

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SAPs Platform Strategy

  1. 1. SAP – ASAP actions!!!<br />October 15th 2009<br />Ahn, Soo Jin<br />Moon, Sung Jin<br />Theerawat Saendawibadhana<br />
  2. 2. 1. Diagnosis of problems<br />IT Consulting - SAP-ASAP action!!!<br />
  3. 3. 1. Symptoms and Problems<br />IT Consulting - SAP-ASAP action!!!<br /> Symptoms Keywords<br />Traditional ERPis overly complex and difficult to install ex) Dell, Kmart<br />Complexity, Rigid<br /> Kmart $130M spending for attempting to implement, <br />Require high<br />investment<br />High failure rate in ERP implementations<br /> (over budget, delayed, hard to exit)<br />Failure rate &gt; 50% according to HBS survey<br />Slow to change<br />Customers should modified more frequently but no-longer wait for upgrade<br />To heavy for small <br />businesses<br />Small, Mid-size companies want to adopt the system without high investments<br />
  4. 4. 1. Symptoms and Problems<br />IT Consulting - SAP-ASAP action!!!<br /> Symptoms Keywords<br />Challenged by transforming open source integrator <br />Push to open, Flexible<br />Major IT players had jumped onto the SOA and web service platform<br />Inadequate for <br />rapid & <br />complex business<br />Inadequate to help companies become e-business <br /> EAI took up half of the time of IT departments.<br /> Therefore SAP decide to catch up with mySAP<br />Decrease in benefit<br />*EAI : Enterprise Application Integration<br />Began to suffer from a lack of revenue gain and decrease in net income<br />
  5. 5. 2. Causes<br />IT Consulting - SAP-ASAP action!!!<br /><ul><li> Traditional ERP is based on closed platform, one-size-fits-all approach
  6. 6. Enterprise packages became incompatible between other venders </li></ul>Internal<br />Complexity, Rigid<br />Require high <br />investment<br /><ul><li> Business model was challenged</li></ul> High license fee model was not preferable for web <br /> environment<br />Slow to change<br /><ul><li> Business environment was changing
  7. 7. Growth rates of enterprise market was declining
  8. 8. Computing environment became more heterogeneous </li></ul>External<br />To heavy for small <br />businesses<br /><ul><li> Customers are changing
  9. 9. Customer requirements became heterogeneous
  10. 10. Tend to adopt best-of-breed model ( custom-built)
  11. 11. Look for specific point solution to enhance own process </li></ul>( preference for keeping uniqueness )<br />
  12. 12. 2. Causes<br />IT Consulting - SAP-ASAP action!!!<br />Push to open & <br />Flexible<br /><ul><li> New trend 1. Web service trend</li></ul> Web services would be from an open-system platform, so diverse application melted into a solution <br />  Enterprise SW venders got more integrate approach<br />Inadequate for <br />rapid & <br />complex business<br /><ul><li> New trend 2. Software-as-a-service trend
  13. 13. Introduction of SOA (Service-Oriented-Architecture)
  14. 14. Run off-site operation by the venders, no longer own the software
  15. 15. emphasis code reuse and business remodeling
  16. 16. impact on reduction in sales and license revenue</li></ul>Decrease in benefit<br />
  17. 17. 3. Risk and Obstacle<br />IT Consulting - SAP-ASAP action!!!<br /><ul><li> The new platform strategy would fundamentally affect the company’s business architecture </li></ul>Risk<br /><ul><li> SAP had to rethink of value proposition, target customers, resource allocation, business process, alliance management, growth engines.
  18. 18. Threat from competitors ( Indian providers, Oracle, Salesforce.com)
  19. 19. SAP would be hard to attract independent developers even if it had open platform
  20. 20. The entire revision of product line wouldn’t be done until 2007</li></ul>Obstacles<br /><ul><li> Necessary of supporting from scalable infra providers </li></li></ul><li>2. Alternatives<br />IT Consulting - SAP-ASAP action!!!<br />
  21. 21. SAP Strategic Positioning & Business Design<br />Expansion of functional Coverage<br />Develop new systems over new Business areas<br />Deepening Industry Knowledge<br />Enter to new industry segment<br />Penetration of Mid-Market<br />Enter to new customer group<br />Development of New Flagship Offering<br />Develop and Offer new products on technology basis.<br />Configuration of Resources<br />Resource constraints for SAP development<br />IT Consulting - SAP-ASAP action!!!<br />
  22. 22. Alternatives<br />Reinforce the “NetWeaver” with Knowledge Management<br />Promote and open the NetWeaver as the open platform for SAP integration development. As well as, to support Knowledge Management System to the community to enhance capability to reconfigure and modify the SAP and applications on the appropriated ways.<br />Expand Product into different business and technical areas<br />Develop the new products and modules to support the market changes such as CRM system, SCM system as business concern or BPM and SOA applicable as technical concern.<br />Develop ASPs service with individual module basis<br />Allow the customers access and utilize the SAP system, which SAP would provide the service available as Application Service Provider.<br />IT Consulting - SAP-ASAP action!!!<br />
  23. 23. Alternative 1: Reinforce “NetWeaver” with KM<br />IT Consulting - SAP-ASAP action!!!<br />Score to align to SAP strategy<br />5 – Most aligned, 4 – Likely aligned, 3 – Moderate aligned, 2 – Unlikely aligned, 1 – Not aligned<br />
  24. 24. Alternative 2: Expand Product on different areas<br />IT Consulting - SAP-ASAP action!!!<br />Score to align to SAP strategy<br />5 – Most aligned, 4 – Likely aligned, 3 – Moderate aligned, 2 – Unlikely aligned, 1 – Not aligned<br />
  25. 25. Alternative 3: Develop ASPs services<br />IT Consulting - SAP-ASAP action!!!<br />Score to align to SAP strategy<br />5 – Most aligned, 4 – Likely aligned, 3 – Moderate aligned, 2 – Unlikely aligned, 1 – Not aligned<br />
  26. 26. Alternative Evaluation<br />IT Consulting - SAP-ASAP action!!!<br />Score to align to SAP strategy<br />5 – Most aligned, 4 – Likely aligned, 3 – Moderate aligned, 2 – Unlikely aligned, 1 – Not aligned<br />
  27. 27. 3. Recommendation<br />IT Consulting - SAP-ASAP action!!!<br />
  28. 28. Recommendation: Reinforce “NetWeaver” with KM<br />Develop the NetWeaver as Commercial SAP EAI product as professional service standard.<br />Prepare the technical readiness to be Open NetWeaver Platform as Open EAI Standard for SAP integration.<br />Develop, Promote, and Contribute the Community of Practices to allow the developers to participate on “NetWeaver SAP Integration Experience & Expert”.<br />IT Consulting - SAP-ASAP action!!!<br />Community of Practice (KM): Developers and SAP contributed<br />HR<br />PP<br />MM<br />FI<br />CO<br />BC<br />SD<br />NetWeaver: Commercial EAI / Open NetWeaver<br />
  29. 29. Actions and Impacts<br />Developers would be volunteer as well as force to participate.<br />The content have to be produced with quality and accurate to create the trust on Knowledge.<br />Maintain the product/service quality as well as the technical support, which directly provided by SAP and certified SAP partners.<br />The sale both SAP and Commercial NetWeaver would not increase at the beginning stage since implementer may not be familiar to the technology.<br />However, it would be increased later according to the technology acceptance and existing SAP customer based.<br />Additionally, the next phase, SAP shall provide the separated module installation and configuration, which it would serve the customer needs as well as enhance the EAI functions to support the future customers’ business changes.<br />IT Consulting - SAP-ASAP action!!!<br />
  30. 30. Conclusion<br />Get the developers as partner by making communities (like Google Android, open-social, etc) .<br />Let companies familiar with new products, technology and concept.<br /> “ Let Customers Do Their Job” – The Long Tail <br />Improve the products and service and gear to Business Oriented.<br /> Software-as-a-Service ex) SAAS <br />IT Consulting - SAP-ASAP action!!!<br />
  31. 31. Thank you<br />Challenge SAP – ASAP<br />before Enemies PASs you!!!<br />IT Consulting - SAP-ASAP action!!!<br />

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