By John Mark V. Tuazon
Computerworld Philippines
June 24, 2010

The harvest is plenty, and so are the laborers, but a huge fence is getting in the way of the gather. This is the peculiar situation in which SAP, a Germany-based software solutions provider, has found itself in regarding efforts to translate its enterprise wins to SMEs.

Having achieved huge successes in the large enterprise space with their robust software solutions tailored to specific industries, SAP is now grappling with the fact that all too many SMEs are finding their solutions expensive.

“One of our biggest challenges in [dealing with] SMEs is getting our message across, in breaking impressions that SAP [for SMEs] is not at all expensive,” Patrick Tan, director for small and medium enterprises, SAP Philippines, said during an interview with Computerworld Philippines during the first SAP Summit 2010, held Tuesday.

Tom Kindermans, senior vice president for SME, SAP Asia Pacific and Japan, upheld Tan’s view, saying it is still an aspect of the business they are working on. “We’re still suffering there,” he shared. “That is a hard fact [that we have to deal with].”

This is, partly if not entirely, the reason why in 2008, the company decided to run a campaign, saying SAP is for great companies, but not just for big companies.

“We also hold events, like [Tuesday’s] SME Summit, where at least 30% of the attendees are our existing customers,” Tan added.

Speaks for itself
If it’s any measure, SAP’s efforts to change SME perceptions may have translated to growth from the sector. Kindermans reported that at least 50% growth in the SME space originated from Asia for the first quarter of 2010, and that at least 43% of their global customers are new adopters.

At least one-third of the vendor’s global revenue, Kindermans revealed, come from SMEs, one of SAP’s “best kept secrets,” according to the executive.

In the Philippines, Tan estimates that the company has a tight hold of at least 60% of the market, a majority of which were implemented through their partners. “We kept majority of our partners since we started the [SME] business in 2005, because we want to ensure that our partners are sustainable also,” he said.

A different land to till
Aside from managing perceptions, Kindermans noted that essentially, the functional needs of SMEs are no different from those of large enterprises, but that SMEs “want value delivered much faster.”

“SMEs want to see instant value. In 12 to 15 weeks, they want to see something up and running,” Kindermans clarified.

The payback for the implementation, additionally, is not just measured in money values, according to Tan. “Some [client] examples achieve ROI within just four months. But the advantage is it offers SMEs more possibilities to enter new market,” he explained.

Swift implementation of solution is also the reason why SAP packaged their SME offerings—the SAP Business One and SAP All-in-One—in such a way that is bundled and easy to implement, without overhead costs or additional IT staff.

“SMEs are not overly structured—they have no IT departments,” Tan clarified. “They ask us how their business processes can be fixed, so we try to package something [that is] ready to run, easily implementable, sustainable, and [easy to] maintain.”

New Version
To exemplify these characteristics, SAP’s latest release—SAP Business One 8.8—will incorporate automated processes, such as the upgrade wizard, that will eliminate the need for a dedicated support staff for the application.

Additionally, the new software release will deeply incorporate CRM throughout the entire solution. “We’re seeing the blending and blurring of applications,” related Richard Duffy, SAP Business One product evangelist, during an earlier press briefing. “Customers want to live in just one app alone.”

Pulling inspiration from famous social networking site Facebook—which, along with Twitter and other Web 2.0 apps, is embedded within the updated version—version 8.8 will directly embed Web 2.0 functionalities so users won’t have to go outside of the main application screen to retrieve pertinent information.

Moreover, users will see increased presence of business intelligence capabilities within the SAP Business One application, following the firm’s acquisition in 2007 of BI app firm Crystal Reports. “SMEs are bound by the challenges of business management applications that are good at recording info, but do not do good on insights,” Duffy explained. “[With these BI functions], SMEs can make business decisions based on their date.”

Incidentally, subscribers of SaaS-deployed SAP BI On-Demand can upload their data over the cloud application and have the option of presenting the data graphically or doing additional analyses with it, Duffy said.

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