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SAP beefs up Business ByDesign to boost SME attraction

4th Aug 2010
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SAP has introduced three Business ByDesign starter packs in a bid to woo small-to-medium sized enterprises over to its newly upgraded software-as-a-service offering.

The software giant currently only has about 100 customers of the system worldwide, of which 70 are live and the rest in the process of deploying it.  As a result, the company is keen to add to the 40 third party distribution channel partners it has signed up across the globe in an attempt to broaden market coverage.

But it also hopes that three starter packs, which comprise pre-defined functional subsets of the larger offering, an implementation methodology and e-learning capabilities, will encourage SMEs with 10 users or more to bite by making implementation quicker and easier.

Peter Lorenz, SAP’s corporate officer and executive vice president of SME solutions, said: “The on-demand services for SAP Business ByDesign are operated on the most modern cloud infrastructure and allow for true volume business. We also expect the new starter packages to enable our customers to quickly adopt the services and realise immediate results on their path to an integrated on-demand suite.”

The CRM starter bundle focuses on sales force automation, but can be upgraded to cover the entire order-to-cash process at a later date. Implementation should take about three weeks at a fixed price of Euros 9,900 or $13,500 and an additional per user subscription fee of Euros 79 or $89.

An ERP starter pack is aimed at organisations that have outgrown their accounting-only systems and now want to add integrated financials and analytics capabilities. Deployment is expected to take about six weeks at a fixed implementation price of Euros 24,900 or $37,500 and an additional per user subscription fee of Euros 133 or $149.

The Professional Service Provide bundle, meanwhile, is targeted at small businesses and medium-sized professional services firms that are after business process management functionality. Roll-out is predicted to take about eight weeks for a fixed implementation price of Euros 34,900 or $45,000 and an additional per user subscription fee of Euros 133 or $149.

SAP has also released a Business ByDesign feature pack 2.5, which includes support for real-time in-memory analytics and mobile devices and includes a customisable user interface.

Rival Cloud ERP vendor NetSuite was less than impressed by the new offering. "It is very hard to know if it is expensive, because it doesn’t say what is included, but at first blush it seems expensive (especially the professional services offering)," said CEO Zach Nelson. "Fixed bid is quite common in today’s world, so that is nothing ground-breaking. However, fixed bid with a custom scope is our approach, rather than the do-it-our-way-or-the-highway approach of SAP’s fixed bid."

Nelson said he saw two major issues with the SAP release. "It seems that SAP is bringing their old weaknesses (namely weak customisation and static locked down business processes) to the SMB market," he argued. "It appears that they are delivering the worst of all worlds – a non-customizable solution with weak native verticalisation.  As a result, customers are forced to use what SAP defines as best practice, not the way the customer feels is best."

He added:  "A fixed bid consulting offering defined by SAP is horribly 'channel-unfriendly'. The channel is expert in defining services for customers, so again, it seems like SAP is forcing an unnecessary change in the channel’s business model." 


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By Michael Libman
05th Aug 2010 11:40

I wouldn't expect anything else from the CEO of one of SAP BYD main competitors, he is clearly rattled by the offering and is tring to find points that might stick in people's minds when looking for such a package. To say these packages are nonconfigurable is a complete missconception. The packages have been pre-configured to largley suit the vast majority of clients but they can also be further configured to to be an exact fit.

The fixed price for implementation should be sufficient for the partners to build an efficient package because the package has been partly pre-configured and system has been designed for 'simple' implementation.

And to say that "It is very hard to know if it is expensive, because it doesn’t say what is included" is also complete bull. SAP are very clear about what they are offerring in my view and if you go for one of the $149 per user packages and you want to add more features to increase its scope it will not cost any more than $149 per user even for the full scope package.

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