SAP Pursues On-Demand Model, BPP

The company reveals its development plans for 2007, including transforming NetWeaver into a business process platform and plotting its on-demand angle.

During its annual Analyst Summit in Las Vegas this week, SAP AG outlined its development plans for the coming year—plans that involve an absolute-process view of the world.

That approach is central to the next version of SAPs NetWeaver integration platform, which with its release in 2006 moves from being a composition platform to becoming a true business process platform, according to SAP officials.

At the same time, SAP officials have come a little closer this week to nailing down the time frame in which users can expect to see an on-demand version of SAPs software.

"We will come out with a product when we are ready," Shai Agassi, president of SAPs product and technology group, said during a round table discussion with members of the press.

Agassi indicated that an announcement would be forthcoming some time next year.

/zimages/1/28571.gifClick here to read about SAPs SOA (service-oriented architecture) strategy.

SAPs CEO Henning Kagermann has in the past said the company would come out with a hosted version of its software, but that it would do so in a manner thats somehow different from the prevailing market leaders platforms.

Those vendors, including Siebel Systems Inc. (which is in the process of being acquired by SAP arch-rival Oracle Corp.), and NetSuite Inc., offer hosted versions of CRM (customer relationship management) and ERP (enterprise resource planning) suites, along with a variety of add-on products.

Salesforce, for example, has AppExchange, an on-demand marketplace where users can access and integrate applications developed by Salesforce and by a cadre of third-party developers who use Salesforce tools.

Analysts suggest that where SAP will differ with its on-demand model is in providing back-end integration to its ERP applications and underlying technologies.

"Its pretty well known that SAP is definitely angling to put on-demand in the market, starting with CRM, based on [the success] of" Joshua Greenbaum, principal of Enterprise Applications Consulting, said during a November interview regarding Microsoft Corp.s on-demand plans.

"I dont expect SAP to have an on-demand competitor to Salesforce that really dukes it out on feature and functionality. What they will do is say they have seamless integration into the SAP stack, and that will be the differentiator."

SAP ERP competitor Microsoft, having repeatedly hinted at an on-demand offering, announced earlier this week its Dynamics CRM 3.0 suite, with both hosted and on-premises options. Microsofts on-demand applications will differ from those of other vendors in that, starting Jan. 1, they will be accessible through partners.

Evolution of a Process Platform

During this weeks two-day summit in Vegas, SAP executives outlined the future of the company regarding product evolution.

That includes ushering in the next wave of computing, dubbed Enterprise 3.0 by Agassi, and building out the necessary services-based architecture, or ESA (Enterprise Services Architecture) in SAP parlance.

The key pieces of that architecture include NetWeaver, and later BPP. SAP announced Monday it would build vertical process platforms as well—the first is called Industry Value Network for Banks—with more to follow.

The upcoming version of NetWeaver will provide a more open process modeling environment to users, a critical component as companies work toward services-based architectures that enable composite applications based on business processes.

"All different things come together based on NetWeaver," Peter Zenke, who heads research and breakthrough technology development at SAP, said during his keynote address.

"We are offering modeling tools of business processes in the next edition of NetWeaver, in [IDS Scheers] Aris, which is the way we model at SAP. These models are open to the rest of the world as well. These are business models we can transform … can expose to non-SAP modeling tools, and can import as well."

Next Page: SAPs development practices.