Q&A with SAPs Peter Zencke

Q: Right. It seems from talking to customers that keeping ERP 2006s core stable is a good approach. Did you stretch the timing of a stable platform until 2010?

A: There is an, I dont want to say infinite, but there is a long, long lifecycle of this edition because it is not the traditional—there is one release in two years, four years and then another one. In principal we are getting rid of these releases, instead we are having that stable core, with a sequence of enhancement packages over the next years

Q: Ive heard that there are concerns that Business ByDesign would somehow cannibalize ERP.

A: There are no indications of that whatsoever. The first place we would see it is in the upper end of the mid-market, not in the high end. There are many reasons why All-in-One is a good solution. Business ByDesign is more generic and in that sense pretty complete.

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Q: Do you see a scenario where partners come in and verticalize Business ByDesign, and would you take the same approach to Salesforce in terms of building out a marketplace for partners?

A: Its still a niche product. It is not mission critical. Its an early data model, not at all mission critical. Whether its sustainable for future business, I dont know.

Q: What happened to SAPs CRM on Demand?

A: There has not been that much scaling as we would have liked. Probably this is because if there are SAP customers and they talk about CRM, they talk about integration and processes, therefore we cannot just copy the Salesforce model. If it were just the Salesforce model then you could just stay with that. But SAP customers have a different expectation—a closed loop from lead to execution. If that works it has to work in the hybrid model. So Salesforce lucky enough doesnt have that problem. We have that problem

Q: What are the issues outstanding with hybrid that you want to tackle?

A: it is just a different model than the whole state of tenant; it is not stand alone. It is an integration. It is just not accomplished.

Q: The more that I understand about the technology that SAP and Oracle are developing—Business ByDesign versus Fusion Applications, for example—it seems like you are maybe not competing head-to-head on a technical level. Is that at all accurate?

A: From the field competition this is really false. From the field perspective Oracle is really tough competition, very tough competition. From the technology side, I dont know whether we should play a more aggressive role, and how we should market that. Maybe more, but our customers dont like that as much. They want to see work. A lot of the feedback today is a representation of where we are …we have always to think about our customers as well, and not always about the customers to win

Q: So you see Oracle being your major competitor for years to come?

A: They have invested their billions into applications to buy and this is a model where at least they can compete. They have sold it to the marketplace that this is how we can accelerate and differentiation from SAP. But they have to prove something It is hard. That is the thing I know. It is hard to acquire different products that were not designed to cooperate, and then just hope that you can weave them together. This is not easy

Q: Do you see any other big competitors emerging. I would think Microsoft with Dynamics. Any others?

A: Microsoft is for sure a partner and a competitor we take very seriously. And they go deep in mid-market, thats for sure. Do they have the money, the people, the intelligence to try to compete, yes, for sure they have that, no? But they start with something that was Project Green—and they got a little side tracked on that.

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