SAP consigns ERP to history

German software giant SAP has announced a strategy to consign the era of the enterprise resource planning (ERP) application to history.

Chief executive Hasso Plattner told 8000 delegates at the Sapphire user conference in Lisbon that the company has turned its mySAP.com software into a set of free-standing components, including a version of R/3, which companies can install separately.

SAP is concentrating on providing private online trading exchanges and portal technology for users to integrate information from SAP and non-SAP software.

During the 1990s, SAP became Europe's largest software company by persuading users to run their businesses with R/3, its 'buy-all-from-us' ERP software.

But Plattner recognises that the approach is out-of-date. "A stand-alone system is probably useless," he said, admitting that SAP has been slow to move away from internal, back-office software to a customer-oriented model.

"Everything was tied into R/3, that was our problem," he said. "We have solved our customers' biggest problem - that we lock them in. No company will ever again use the whole software from one company. They want the freedom to choose."

SAP is not the first to make such a move but, as the biggest ERP supplier, its new direction is significant. But some analysts believe that the company's new approach may not be as easy to implement as it hopes.

Simon Pollard, vice president of European research at analyst AMR Research, warned users not to underestimate the effort involved in integrating SAP software with other applications.

"SAP wants to provide the bulk of a company's technology, but is making itself more open. Time will tell how effective it is," he said.

Also published in Computing