This recent article on SearchSAP.com sums up the changing landscape in SAP market and its ecosystem.
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"The top SAP stories of 2008 |
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By Courtney Bjorlin, News Editor |
Who says enterprise software is boring? It certainly isn't for SAP customers. SAP gave us plenty to talk about this year. Here, we rank the top eight SAP news stories of 2008.
8. SAP: We can't develop everything ourselves
SAP continued to move away from a solely internal product development model and pushed co-innovation, in which it partners with other vendors and even customers on new products.
The theme headlined TechEd, SAP's annual conference for SAP managers, developers and administrators. SAP also announced its first major projects with vendors like Cisco and VMware, and started a website called EcoHub, where customers can review partner products.
SAP also signaled its willingness to build its product portfolio through acquisitions and bought Visiprise, a manufacturing execution software company... "
Continue reading the full article here..
The article basically captures 4 trends heating the SAP market and the general ERP industry as a whole.
1. Rapid innovation fueled by growing ease of developing new web based agile applications and the general industry trend to move towards SaaS.
2. The saturation of traitional markets (large businesses) as growth drivers for SAP and therefore a rapid push by the software giant to enter the SMB sector.
3. The competition driving complexity of SAP applications, technology stack, constant product changes, and thereby resulting skill gap in the market.
4. The general market trend towards cost cutting due to economic woes.
To summarize the above ERP markets and in particular SAP software that had dominated the large and medium enterprises from last two decades suddenly find there software maturity models being challenged due to the emergence of more cost effective, innovative and agile SaaS vendors.
The problem is more heightened to the fact that the new target markets for SAP, represent a much smaller set of enterprises. These enterprises have less appetite for costly SAP implementations and are more attuned to low cost, high usability and scalable SaaS alternatives.
SAP's recent push to move towards co-innovation and doing inorganic growth by acquiring companies that fill software gap sounds like steps in right direction. I only see these steps being accelerated in coming years if the software giant were to keep its dominance in the business software market.
Lastly, what SAP existing customers really need is an On Demand self-service support system that can help them keep up with the software changes, keep up to date on latest SAP skills and provide crucial software support at the same time. I am not sure this can be augmented with SAP Enterprise Support alone.
