SAP AG’s new software-as-a-service (SaaS) strategy for large enterprise customers may allow the ERP giant to fend off encroachment on its customer base from a rapidly growing group of new competitors, but it won’t do much in the near term to establish SAP as a SaaS leader, experts say.
“SAP now has a SaaS strategy for the large enterprise market, and that is important,” said Ray Wang, a vice president at Forrester Research. “But this is very much a defensive strategy. SAP needs an offensive strategy that will allow them to build products that customers of Oracle and other competitors will want.”
At a recent SaaS conference in Amsterdam, John Wookey, SAP’s executive vice president for large enterprise on-demand, said the company plans to roll out a series of SaaS products for large enterprises that integrate tightly with SAP’s on-premise Business Suite and run on the Java-based on-demand platform that SAP acquired along with Frictionless Commerce in 2006. SAP will concentrate on selling the SaaS offerings to existing users of its business suite rather than new accounts, Wookey said.
SAP’s SaaS offerings for large enterprises will include some existing and some new products. Existing products include SAP’s CRM on-demand and e-sourcing services. SAP CRM on-demand will be migrated to the Frictionless on-demand platform, said SAP Senior Vice President for Solution Management and SaaS Strategy Sailesh Rao, in an interview with Managing Automation.