SAP buys up Pilot to boost analytics

25th Feb 2007

SAP has expanded its analytic capabilities with the acquisition of Pilot Software, a privately-held provider of strategy management software.

SAP plans to integrate Pilot's flagship product, PilotWorks, into its NetWeaver platform-based suite of business software products while Pilot employees will become part of the SAP Labs network.

The integration of PilotWorks into SAP NetWeaver is intended to allow managers to use PilotWorks in support of performance management goals, according to SAP. The PilotWorks platform aims to bring discipline to operational performance review processes, popular in industries like manufacturing, that provide weekly, monthly or quarterly status updates on various business operations. It allows executives to manage goals and initiatives more effectively and bring structure and consistency.

"Analytics applications that help organisations manage their performance effectively represent a strategic area of investment for SAP as we continue to expand our leadership in this market," says Doug Merritt, executive vice president and general manager of suite optimisation at SAP. "With the acquisition of Pilot Software, we are providing an advanced system for defining and managing strategies that integrate with the business processes of information workers."

SAP had previously pledged to embed analytics, which was kicked off with its composite application analytics dashboards. The Pilot acquisition aims to ensure that strategies coded in SAP's analytic applications can be executed through tighter integration with CRM, ERP and supply chain management applications.

“Pilot has a long and storied history,” comments AMR Research’s John Hagerty. “It was an early leader in the market for data visualisation in the 1980s and on the forefront of OLAP in the 1990s. It was acquired by information conglomerate Dun & Bradstreet (D&B) as a core component of D&B’s comprehensive information delivery plans. When D&B split into many pieces, Pilot was eventually divested and ended up as part of Accue Software, an analytic application company.

“While it has been low profile until recently, the products look very promising and fit well into SAP’s articulated vision. Pilot’s embedded OLAP engine may eventually find a role in SAP’s emerging arsenal of business intelligence/performance management capabilities. Within the next quarter, we expect SAP to fully articulate its plans for PilotWorks as part of its CPM vision. The acquisition, while not high profile, is a type of tuck-in purchase we’ll probably see a lot more of in the future.”

“SAP has made a number of small 'in-fill' acquisitions that have had a similar strategic purpose: they add either industry specific or cross-industry functionality that helps to fill gaps in a broader solution footprint,” adds Ovum’s David Bradshaw. “Software industry acquisition strategies are developing a common theme, beyond the similarities that exist between SAP and Oracle. Most are aiming to complete a solution footprint, adding missing functionality through acquisition rather than in-house development. This is equally true for platform providers and business application players.

“We expect all of the major software industry players to continue making in-fill acquisitions for the foreseeable future, at a steady and potentially increasing pace. The acquirers and the acquired are not difficult to predict, as the pattern is now well defined.”


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