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SAP Business ByDesign User Reviews

 

SAP Business ByDesign Back To The Drawing Board

Following the public relations blitz organized by SAP in September 2007 in which SAP CEO, Henning Kagermann, boasted that SAP would release an on-demand ERP software solution and acquire 1000 customers in 2008, the German software CEO now says in May 2008 that the product has incurred significant user, architectural and performance problems and may be delayed until 2009 or 2010.

Just prior to our last ERP software review, in an April 30 conference call, CEO Kagermann said that SAP is cutting back on the development of the Business ByDesign hosted software product because of negative customer feedback. An SAP developer told a German newspaper the week prior that the software was suffering from performance problems and excessive bugs. Other reports have indicated that the solution bears user challenges and severe implementation difficulties.

"We decided this is the right time to adjust the pace," Henning Kagermann said. "We have a brand-new product, we have live [beta] customers and the market likes the concept. We have learned we need more time to take additional steps toward optimizing the end-to-end process of delivering, selling and running the solution." CEO Kagermann went on to say that SAP will not reach its first goal of 1,000 customer engagements in 2008 and that "We expect the rollout to take 12 to 18 months longer." Assuming that Kagermann's estimate is a best case scenario, that would bring the German software maker's on-demand ERP software solution to market more than two years after it's official unveiling.

Analyst firm Forrester believes the slowdown with Business ByDesign is in part due to SAP's new chief operating officer, who is taking a harder line with expense controls and challenging lines of business not affiliated with the company's flagship product. According to Forrester principal analyst Ray Wang, SAP has reduced investment in the product by about 100 million euros or $155 million in 2008. It's only obvious that decreasing the software investment in a hosted product that in incurring increased technical problems puts the entire product line at risk of never reaching the market.

Never shy to tout SAP's shortcomings with hosted software solutions, NetSuite CEO Zach Nelson chimed in by writing an email which stated, "This delay indicates there is something seriously wrong at SAP, given this is the third missed date. I think the delay has to do with the fact that they have built the product around multiple data silos rather than using the NetSuite approach of a single data model to support the application. When they do finally come to market (maybe IF they come to market), and Business ByDesign has multiple data stores, the product will be dead on arrival."

NetSuite's CEO may have some valid points. SAP's commitment and investment to the SaaS industry has been mixed and erratic. Further, when it comes to software as a service, the company's actions often do not match their words. The enterprise software giant initially chastised and dismissed the entire on-demand business software industry, however, ultimately found themselves fighting a losing battle and announced their own hosted software solution (initially called A1S and later renamed to Business ByDesign). SAP's on-demand strategy is seen by many as a defensive tactic intended to slow the client attrition being lost to SaaS pure plays such as Salesforce.com and NetSuite as well as use an on-demand product as a customer acquisition tool with the potential to later migrate those customers to the company's flagship on-premise solutions.

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