SAP is having a problem of coming to terms about what to do with on-Demand.
Reading recent headlines about SAP’s direction on SaaS are confusing:
SAP exec: No Plans for additional on-demand ERP
versus:
SAP’s Kagermann Reveals Plan to Bring SaaS to Large Companies
What’s going on here? Is SAP moving forward with on-demand or not? Digging down more, it seems that SAP is very concerned that a new SAP SaaS offering would canibalize sales of their existing offerings. But, at the same time, SAP can’t ignore the momentum that SaaS is taking, and not having some sort of story around SaaS makes it look like SAP isn’t keeping up.
Following Microsoft’s playbook, SAP is trying to strike a balance between traditional software and SaaS, and they plan to do that by building SaaS extensions into their existing products. They’re doing that with ‘components’ — not stand-alone SaaS apps, but on-Demand elements that work together with traditional SAP applications the customer runs on-site.
Mixed-models are not without problems — keeping data both on-site and also in the ‘cloud’ can be hard. Analyst Stuart Williams of Technology Business Research said that a big question is “who owns the data, and who manages the business network? Governance is a concept that by definition is not about mushy or ill-defined boundaries.”
When asked whether SAP will be offering full-blown on-demand versions of Business One or All-in-One ERP products, SAP’s Kagermann said that “there’s no need to do it.” Rather than on-Demand Kagermann suggested that companies consider their Fast Start implementation program for All-in-One and hardware-software packages that bundle SAP software as part of new partnerships with HP and IBM.
