SAP makes ERP real-time, catches up with Oracle - UPDATED

By Stuart Sumner
11 Jan 2013 View Comments
SAP building

While using HANA's in-memory capability will speed up the business reporting process, it is the ability for data views to be generated immediately that will be more exciting to potential customers.

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This is "a benefit that not only reduces database footprint and storage requirements, but also potentially simplifies the modelling and deployment of data and the design of analytics or other complementary applications that run atop Business Suite," commented Ovum.

"HANA's in-memory architecture also allows analytics to be embedded with transaction processing, enabling companies to become more agile. For instance, SAP customer John Deere achieved positive ROI on its HANA investment based solely on the benefits of implementing it for pricing optimisation," they added.

However, brand and messaging remain a concern for SAP, who need to build a clear picture of their offering for the market.

"HANA has evolved over the last two years from a database to an analytics platform to simply a 'platform'. How SAP avoids confusing the market will be a key factor in driving competitive advantage."

SAP has been criticised in recent months by customers at the SAP user forum held in the UK, and also by Lego CIO Henrik Amsinck, who told Computing in November last year of his frustrations at the complexity and inflexibility of its pricing and licensing models.

"SAP has totally spoiled its own value proposition," Amsinck said. "In the old days I loved SAP because the price list could fit entirely on one A4 page. You just paid for light, medium and heavy users, it was very simple. But it has completely blown that away now and I'm so sad about it. It was a very transparent costing structure, but it's now a hyper-market of applications.

"The price list is now over 300 pages, and it's very hard to work out how to do something. It's even harder to work out what it costs to run that number of applications. Even SAP sales people have a hard time telling you what you need."

He added that SAP's refusal to allow customers to stop paying for licences they no longer want or need makes it impossible for him to cost-effectively trial new services, describing a situation where he wanted to experiment with a new CRM system, providing it to a business unit to try out for a couple of years.

"Imagine you take the whole thing as a pilot, buying licences, add-ons and other fees, but it ultimately doesn't work out and you decide not to continue. Now the SAP pricing system says that's fine, they take back the licences, but you'll still pay maintenance even though you're not using anything.

"You'll pay 22 per cent per year - and to me that's very weird. I'm giving the licences back, but they're charging maintenance forever. So it's cheaper to buy the same box from third-party vendors because they can't charge me for the maintenance if we quit.

"So now, if all else is equal, if I can find a shadow IT product offering the same service, I'd buy that instead because the licensing terms will be far more attractive."

He complains that this inflexibility from SAP makes it impossible for him to deliver on his CEO's ambition.

"How can I live up to the CEO's request to be more adaptable if anything I experiment with will haunt me forever? Am I the only CIO to worry about these licensing terms?".

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