SAP launches web delivered ERP on-demand for mid size users

The company says its four guiding principles have been: completeness, ease of use, adaptability and significantly reduced total cost of ownership (TCO). Has it delivered? Well, users of the on-demand ERP software will get built-in service and support, and the current offer is $149 per month per user, with lower prices for ‘efficiency users’. Dubbed SAP Business ByDesign, it represents a new business model for SAP and is likely to change the markets view of rented ERP over the web. SAP says it has been working with customers and partners over the last six months to validate the product, with 20 organisations already live in Germany and the US, including Stemme AG, a utility and sports aircraft manufacturer; Judge Consulting Group, Mantz Airmotions and Compass Pharma Services. “SAP has done a tremendous job of translating our business requirements into an easy-to-digest business flow within SAP Business ByDesign,” says Kevin Flanagan, CEO, Compass Pharma Services LLC. “It’s clear that SAP really took the time to understand how smaller businesses think and operate. We now plan to spend less than 25% of our original IT budget and are excited to be one of SAP’s first SAP Business ByDesign customers.” SAP sees itself adding an important element to its portfolio, which, it says, will enable it to attack this $15 billion market where BusinessOne, All-in-One and SAP business Suite aren’t ideal. It sees the offering as right for users in the range of 100 to 500 employees. As SAP puts it: “Growing companies that typically have not invested in these types of integrated business solutions.” SAP estimates that there are more than 60,000 such companies in Germany and the US alone. Says Henning Kagermann, SAP CEO: “SAP Business ByDesign is designed to dramatically simplify IT for mid-size companies... The technical advantages of SOA [services orientated architecture] enter the level of business processes and allow customers to exploit the full potential of new business trends without becoming IT experts. Such an affordable, easy-to-use and complete offering has been missing for mid-size companies … until today.”