SAP State of The Union: The CEOs Talk Oracle, SaaS ERP

Today at the company’s Palo Alto offices, SAP’s co-CEOs, Bill McDermott and Jim Hagemann Snabe, fielded questions about the enterprise software giant’s general state. Last month SAP experienced certain discomfort when Léo Apotheker resigned as CEO after only nine months on the job, and speculators attributed his departure to SAP’s inability to get a solid SaaS ERP product off the ground. Snabe and McDermott offered sentiments on the company’s current strategy, Oracle, and the future of SaaS developments.

SAP has been under fire for their lack of SaaS developments for quite a while now, and to that end the two CEOs said that their on-demand platform, SAP Business ByDesign, is in beta testing and will be generally released this summer. The wait for Business ByDesign ERP has been a long one, so naturally some are remaining skeptical of the platform’s abilities until they see something more than slideshows. McDermott did admit that Business ByDesign has taken much longer than expected, but says that with functionalities ranging from supply chain to cash management to CRM, the product will do much more than competing platforms.

Another hot-button topic the duo addressed: Oracle, their foremost competitor. When Business ByDesign is released, the CEOs posit they’ll be discussing a triumph over Oracle, but for now they chose to discuss their contrasting business model. Oracle has been growing through acquisitions, while SAP has pushed for growth by strengthening and broadening core products. The CEOs are standing by the decision to innovate from within, and plan to give Oracle a run for their money with future Java projects.

This summer will be an important one for SAP. It’s is a large and relatively successful ERP provider, so the Business ByDesign ERP will most likely be a great product, but the platform’s perpetual delays have many worried. SAP recently announced the desire to have 1 billion users by 2014—a feasible but still ambitious task. The success of Business ByDesign will likely be a factor in whether or not they reach this number.

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