SAP SME?

Volker Hildebrand’s article on the MyCustomer.com site encapsulates all that confuses me about SAP’s approach to the CRM market. Entitled ‘CRM market trends: what buyers need to know’, the article’s first identified trend is that the CRM market is consolidating. This knocked me back a bit because my take is that over the last four or five years we’ve seen a massive expansion in CRM vendors on the back of the Salesforce.com establishing a new front in the market based on a hosted offering. Do I believe the market will consolidate – yes; do I believe it’s consolidated – not yet. But when I thought about it for a while I realized from SAP’s enterprise perspective it had consolidated. Once upon a time its competitors were Siebel, Oracle, and Peoplesoft, now with Larry Ellison’s substantial appetite for acquisitions there’s just one – Oracle.

So, from my perspective working with mid-sized companies as we do, the market has expanded dramatically, from a SAP perspective working with global 2000 companies as they do there has been a consolidation in terms of the companies with which it normally competes. However this is all well and fine until you consider that SAP’s strategy is to crack the small and medium enterprise (SME) market, and my concern is that their mind-set is still rooted in the cold war era of SAP vs Oracle, not the competitive realities of the SME space. Which is a pity because there is a pent up demand for combined front office/back office solutions that remove the need to integrate a company’s core applications. My doubt is whether SAP can make the transition from the mega-budget enterprise market, to the considerably leaner SME space. When I read lines from Volker such as:

‘Enterprise services-oriented architecture is paving the way for firms to be able to leverage customer interaction channels as important sources of differentiation’

I figure we may not be talking the same language – and no I don’t have the slightest idea what this means in practice. My own interactions with SAP on the CRM front have been no more fruitful. Trying to obtain pricing for example tends to induce evasiveness that one might have expected if I’d asked to borrow chairman Hassno Platner’s yacht for the weekend.

The IT market is strewn with case studies of enterprise players who have tried to succeed in a broader market and failed. I guess when you are used to dining on caviar then fish and chips just doesn’t cut it. I would like SAP to succeed because at the right price there’s an unmet demand for what they do. If you were to ask me if they were likely to do so I’d say no. I think enterprise is part of their DNA, and I don’t think they understand the SME space is fundamentally different. I’d like to be proved wrong though – perhaps we can review in a year to see if I was.

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