Wednesday SAP announced the new Business Suite 7 at its global marketing HQ in New York. I listened to the live webcast (one of the analyst in my apps group attended) and I ended feeling like I usually do with SAP, a little fuzzy on just what the announcements meant and with the need to dig in a deeper to figure out just what was really changing / launching. Since the event I've listened to the recording a few times, viewed some of the videos and dug through the released material. Now I think I do "get" it.
Going into the event there were really two general opinion camps, either this would be a mostly marketing "message" or "spin" heavy release or maybe this would be a substantive, feature-rich release. There was also some hope that the announcement would clear up the current haziness around SAP's SaaS / cloud strategy and the status of BusinessbyDesign. As far as the SaaS question goes nothing was cleared up, in fact there is probably a bit more mist just by the fact that nothing was cleared up (and a few comments about "cloud" that left the "concept" in the research project bucket for SAP). For the rest though I'd have to say that the announcement falls somewhere in the middle. some marketing but underneath there are a few key changes that customers will probably find interesting.
1. For the first time with Business Suite 7 (which includes PLM, CRM, SRM, SCM + all with 7.0 version numbers and the core ERP 6.0 with no change in version number) SAP moves to a synchronized release of all products in the suite.
2. Overhaul of the GUI which results in a fairly consistent user experience across the suite. The more modern GUI of the CRM product provided the model for the rest of the modules.
Note: with these first two changes it would also potentially allow SAP to consolidate some R&D with some cost savings in the future.
3. SAP now taking a modular approach and has moved away from the monolithic suite approach. Now this is partially marketing but also involves pricing changes (pay by the module).
Note: This move away from the suite messaging and towards a modular approach is partially a reaction to the current economic environment where companies are doing things in "bite size" pieces rather than investing in large, long term projects / rip out and replace. In a modular approach a company could focus on areas of greatest value and implement in a phased approach (which all good IT project managers know is the least risky path). The modular approach is also an attempt to block Oracle and others (which might be seen as "best of breed" apps in specific business processes) from getting more apps into SAP accounts. With SOA enablement in most apps these days customers have been buying in more of a mixed-brand best of breed suite or virtual suite. They also are starting to buy in hybrid suites that mix on premise and cloud-based apps.
4. Increase of embedded analytics throughout the modules using acquired products from Business Objects.
5. A change in the frequency of enhancement packs. Enhancement packs were announced in late 2007 as a replacement for upgrades and were planned for release every 6 months. Customers apparently couldn't consume the packs that frequently. The new schedule would provide packs annually going forward (and presumably will be twice as large as the 6 mo packs).
Note: I remain skeptical that calling something an "enhancement pack" makes it easier to consume than an "upgrade". The push back from customers on the 6 month release cycle would seem to support the idea that they still require resources and a project to implement.
6. SAP is in some ways returning to its roots by focusing on business process again and introduced the concept of value scenarios (which are basically cross app business processes). The processes can be enabled / disabled with a Netweaver component called a switch framework (which is a reasonably descriptive name). There are around 150 value scenarios at present but one would assume that SAP will deliver more over time.
Note: Customers use software in a business process format, not an application by application approach. This is a good move by SAP to get more in alignment with what the customer wants.
7. SAP joins the other major enterprise SW vendors and announced some Enterprise 2.0 (E2.0) capabilities in BS 7. BS 7 includes something called a “sentiment engine” which during the demo on Wednesday, was pointed at Twitter. It's a brand management tool that I assume could capture conversations from various cloud-based services.
All-in-all some interesting announcements. Of course to implement BS 7 the customer must be on ERP 6.0 (enhancement pack 4). It remains to be seen though, how customers will react to BS 7 and whether they will rush to purchase in very difficult economic times, either module by module or mega-suite.
