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SAP Targets Enterprise SOA
SAPPHIRE '06: Amid "the industrialization of software," the German juggernaut continues its service-based strategy.
Posted May 17, 2006
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Enterprise service oriented architecture (SOA), or, according to SAP, enterprise services architecture (ESA) took center stage in Orlando Tuesday during the SAPPHIRE '06 afternoon keynotes, delivered to more than 15,000 attendees. "The industrialization of software is upon us," said Bill McDermott, president and CEO of SAP Americas, and corporate officer of SAP AG, at SAP's annual user conference. "We're moving into a world of mass customization," he added, noting that the industry is moving toward component-based assembly, while industry-specific solutions are now being decomposed into smaller enterprise service repositories that all applications can draw on.

McDermott also highlighted three of SAP's apps being featured at SAPPHIRE: SAP Analytics, which leverages SAP Business Intelligence to integrate data from sources including SAP, third-party and custom apps, and legacy systems; SAP's CRM on-demand functionality; and Duet, the Microsoft integration formerly known as Project Mendocino.

SAP unveiled its CRM on-demand offerings in February with the launch of the SAP Sales on-demand solution. The initial release was designed to help organizations manage customers, contacts, and sales pipelines with configurable tools, while enabling businesses to migrate to on-premise deployment at their own pace. SAP's second wave of on-demand functionality is scheduled to be unveiled at SAPPHIRE today, including extended pipeline performance management capabilities for the Sales on-demand offering, along with the first installment of SAP Marketing on-demand.

As to be expected, Greg Gianforte, CEO and founder of CRM on-demand competitor RightNow Technologies, isn't impressed. "SAP continues to push both their business process solutions and misguided assumptions about the on-demand market," he says. "The company continues to remain solely focused on back-office systems that optimize processes, where we, on the other hand, are focused on delivering frontline impact at the point of contact with each customer." He contends that the company is also misguided in its assumption that on-demand is an entrance ramp to on-premise. "Siebel fell into the same trap, and Oracle is following right along, as well."

However, Rod Masney, global information and technology architect for O-I, a manufacturer of consumer goods packaging, says his company is considering SAP's on-demand product. "It's an exciting offering that we perceive we can get value from."

Duet, highlighted by SAP customer and early Duet adopter Home Depot, ties SAP business apps to Microsoft Office applications to maximize efficiency. "Bringing those two worlds together inside our enterprise could have huge productivity implications," Robert DeRhodes, executive vice president and CIO of Home Depot said, citing potential changes in the way that company thinks about reporting and workflow. Home Depot also intends to extend capabilities to business areas like its field force. Gary Butler, CEO-elect of payroll, benefit administration, and HR specialist ADP, was also on hand to discuss its GlobalView HR offering powered by SAP HCM, CRM, and NetWeaver.

McDermott noted three points that companies need to know about enterprise SOA--it's evolutionary, not disruptive; user empowerment and business process innovation is at the heart of the architecture; and organizations can begin implementing now. "We're committed to building, buying, or partnering to bring end-to-end business solutions to you so every customer we work with can be a best-run business," he said.

Leo Apotheker, president of customer solutions and operations and member of the SAP AG Executive Board, took a more aggressive approach to encouraging more SOA-based deployments. For companies skeptical about enterprise SOA, "ESA is a reality," he said. "You [can't] afford to sit on the sidelines and observe."

SAPPHIRE '06 is colocated with the Americas' SAP Users' Group (ASUG) annual conference, allowing ASUG members and SAP's customer base to "come together and share an unparalleled experience of education, networking, and influence," Masney says. (He assumes the position of ASUG president today.). SAPPHIRE '06 runs through Thursday, while ASUG's conference runs through Wednesday.

Related articles:

Oracle Versus SAP: The Gathering SOA Storm


SOA Simple

CRM examines service-oriented architecture and its growing impact on the applications landscape.


SAP's On-Demand CRM Valentine

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