SAP Wants to Wean Customers from R/3

SAP wants to convince customers that it's time they migrated from their steadily aging R/3 applications to MySAP Enterprise Resource Planning applications that are integrated with NetWeaver and the Enterprise Services Architecture.

SAP will use its Sapphire user conference the week of May 15 to try to persuade customers to move from R/3 to MySAP ERP.

The company, based in Walldorf, Germany, seeks to entice customers with the recent development bonanza around its ESA (Enterprise Services Architecture) concept and underlying NetWeaver integration platform, including ecosystem initiatives like its Industry Value Networks.

SAP also will announce at the Orlando, Fla., show the long-awaited release of MySAP ERP 2005, which brings full NetWeaver capabilities.

Under the covers, however, pushing customers to MySAP, will be users growing unease with rising maintenance costs and at least the perception that older R/3 products will be retired.

Customers now are caught in the middle. While mySAP 2004 is available—it has about 500 customers, according to Gartner—there are not many technical changes from R/3 to mySAP 2004. The real release that has any significance is mySAP 2005, which has too few users to be considered proven.

/zimages/4/28571.gifClick here to read about SAPs program to offer cut-rate support for Oracle ERP applications.

"Most people are not there yet—theres a whole continent of 4.6 C users, and at the end of the year their maintenance goes up," said Gartner analyst Yvonne Genovese. "Their problem: SAP has not GAed mySAP ERP 2005 early enough to [enable them to] make a decision."

The value of upgrading to MySAP 2005 stems from the more modern development concepts in play at SAP, particularly around the service enablement of MySAP ERP, and the process integration capabilities inherent with that.

The problem with upgrading is that the technology is confusing, expensive and difficult to implement, customers say.

"In the past, when you just ran R/3, you had a single environment to deal with," said John Wheeler, CIO of Nova Chemicals, in Calgary, Alberta, which is upgrading to MySAP ERP 2004.

"Now, all the new products run in separate environments, so instead of one production management environment, you end up with something thats four or five times more complex. If one doesnt mitigate that complexity, its a significant increase in your IT budget."

Next Page: Visions of SOA, mySAP.