Subba’s Serendipitous moments

May 14, 2007

SAP has a new direction

Filed under: Business,Model — Subbaraman Iyer @ 2:14 pm

SAP co-founder Hasso Plattner unveiled a new direction for SAP at the annual Sapphire event in Atlanta and reiterated that more graphically at Software 2007.

His direction is bold — because it indicates that SAP will come up with a completely new code base for the SMB business, completely different from SAP’s current business suite. Code names as A1S, it is intended to be On-demand, rather than a on-premise version due to release in mid 2008. Around 3000 engineers are working on it.

Though SAP has been late, given that the architectural constructs have been proved beyond doubt by the success of salesforce.com, it is still a welcome move.

He is absolutely honest when he claims that it is far difficult to change one’s model, especially if one is successful. There is always the risk of cannibalizing one’s current revenue streams for an uncertain future; however it seems to me that the future of hosted solutions is certain, and the SMB market will readily accept that.Changing the technology model is easier though, what will be challenging is the execution part. SAP will have to deal with internal conflicts, channel conflicts, partnership issues and so on. However given SAP’s emphasis on the SMB model, it may very well create an independent business unit with this new code base acting as the bootstrap.

Dr. Hasso also talks about video conferencing (much as the same way as Cisco with their Telepresence) and hence it is only a matter of time before video conferencing becomes mainstream not just for laege enterprises, bit even for the SMB sector.

A more detailed coverage of Dr. Hasso’s vision and direction can be found here.

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3 Comments »

  1. […] SAP failed to execute the SME strategy effectively, something that I clearly foresaw about which I commented here. […]

    Pingback by SAP faces the moment of truth « Subba’s Serendipitous moments — February 10, 2010 @ 10:59 am | Reply

  2. […] SAP failed to execute the SME strategy effectively, something that I clearly foresaw about which I commented here. […]

    Pingback by SAP faces the moment of truth | Expanding Thought — March 10, 2011 @ 5:09 pm | Reply

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