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SAP teams with IBM, HP to bring ERP to midmarket

Zach Church, News Writer
ORLANDO -- Leaders at SAP AG say they plan to double the number of users for the company's midmarket-specific Business All-in-One ERP

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offering. To do that, they're trying to make the program easier to buy and install.

Yesterday SAP announced partnerships with Hewlett-Packard Co. (HP) and IBM that are intended to make implanting All-In-One a quicker process -- in some cases taking it down to a matter of days. The partnerships should drastically reduce cost of ownership as well, SAP representatives said.

The company also announced a new online tool intended to woo potential customers to All-in-One by allowing a user to build a software package and receive a price quote within a matter of moments. The tool -- SAP is calling it a "solution configuration" -- makes purchasing suggestions based on industry and size of company. SAP senior vice president Glenn Wada likened it to shopping for and customizing a new car online.

"That's our message to the marketplace," Wada said. "That SAP is extremely accessible.

"What we've come to realize is that SAP has to be much more nimble. SAP has to be much more pervasive," he said. "We have to be more persistent and we have to make it easier for customers and prospects to find us."

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As part of the collaboration, IBM has pretested software and hardware packages and built an installer intended to severely cut implementation time of All-in-One onto its infrastructure. HP is building Business All-in-One directly onto its BladeSystem and ProLiant servers.

The intent is to cut the time and cost investments of the "assemble and put together" part of purchasing an ERP system, IBM general manager Reinaldo Zinn said.

While the deal with HP and IBM is meant to simplify the purchase and implementation of SAP's Business All-in-One product for midmarket customers, it also means another channel for IBM and HP to sell their blade servers.

Business All-in-One is an ERP system intended for companies with 100 to 2,500 employees. There are about 11,700 customers worldwide, said Hans-Peter Klaey, president of SAP's small and medium business organization.

But Klaey said he wants to go higher -- he wants the online tool and new partnerships to lift the ERP system's customer base to 20,000 customers "as quickly as possible."

We have to be more persistent and we have to make it easier for customers and prospects to find us.
Glenn Wada
senior vice presidentSAP AG
The partnerships are the latest moves in SAP's fast-start program, announced in February and intended to market All-In-One as an increasingly easier-to-implement and deploy ERP system.

All the activity is part of a midmarket strategy that will see SAP relying more heavily on channel resellers and trying to bring Business ByDesign, its first on-demand ERP system, to market. The complete Business ByDesign rollout has been delayed into next year, dashing SAP CEO Henning Kagermann's goal of 10,000 customers by 2010. Business ByDesign is intended for companies with 100 to 500 employees.

Wada said SAP did just more than 10% of its small business and midmarket North American business through the channel last year, but it's aiming for 40% this year. Customer satisfaction with the product is slightly higher when purchases are made through the channel, he said. Many of the new All-In-One customers are coming from life science and biotechnology companies, as well as oil and gas companies.

By positioning All-in-One as an easy-to-buy, easy-to-implement ERP system, SAP is trying to further penetrate the North American midmarket, where Wada said he sees growth potential. He said SAP adds a midmarket North American customer every 1.5 days. Wada identified Oracle products as the top competition in the market. Microsoft's Dynamics ERP system is also marketed at midsized companies.

Let us know what you think about the story; email: Zach Church, News Writer


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