Tuesday, October 31, 2006
ERP Blind Spot (Line56)
BHP Billiton Petroleum uses Quadrem to supplement SAP; addressing complex services
Monday, October 30, 2006
Oracle's 'Unbreakable Linux' Will Threaten Red Hat (Gartner)
Oracle's Linux support offering is a more complete solution than Red Hat's. Oracle aims to assert more influence on Linux adoption, accelerate Oracle DBMS acceptance and bolster Linux against Windows.
Wednesday, October 25, 2006
Oracle enters the Linux arena (FT)
Oracle on Wednesday carried through on recent intimations that it might move fully into the Linux business, a step analysts said would change the dynamics of one of the fastest-growing parts of the software world.
The US company said it would make available its own version of the open-source operating system under the new “Unbreakable Linux” brand. It also said it would offer bug fixes and full support for the software at a lower price than that charged by Red Hat, the biggest Linux company.
The US company said it would make available its own version of the open-source operating system under the new “Unbreakable Linux” brand. It also said it would offer bug fixes and full support for the software at a lower price than that charged by Red Hat, the biggest Linux company.
Friday, October 20, 2006
Inside SAP’s 3Q Results with Bill McDermott (AMR)
Last Thursday, SAP released its financial results for the 3Q06, ending September 30. As usual, the numbers were closely watched, especially given the recent stronger-than-expected results from rival Oracle for its most recent quarter.
Thursday, October 19, 2006
SAP (FT)
Ker-pow! With its latest set of results, SAP has delivered an uppercut to claims by Oracle, its US rival and critic-in-chief, that the German software group has lost its way. Investors at the ringside were less impressed, however: SAP’s shares fell 3 per cent on Thursday in a flat German equity market. Yet SAP’s numbers were solid in almost every respect. In terms of quarter-on-quarter growth in software licence sales, it was SAP’s best summer since the 1990s. All regions turned in a good performance.
SAP’s cautious outlook disappoints (FT)
SAP, the world’s largest maker of business software, on Thursday beat investor expectations about its performance in the third quarter but disappointed by putting a cautious gloss on an otherwise unchanged forecast for the year.
Wednesday, October 18, 2006
SMEs: How Oracle and SAP are moving down ‘the tail’ (FT)
Directors of small and mid-sized businesses can expect to be feted by two of the world’s largest software vendors in coming months – if they have not already received their invitations.
For enterprise software giants Oracle and SAP, the mid-sized and smaller company is not just the next sales opportunity. It is set to be the greatest driver of their growth.
In June, SAP booked the 10,000th customer for its Business One package for smaller companies. It says sales to small and medium companies are contributing to its double-digit growth in turnover. Oracle has set itself tough targets for increasing sales to SMEs, executives say.
Both software companies want to win custom for their enterprise resource planning, financial, supply chain, customer relationship management and other business- critical software.
They are hoping to draw smaller companies away from specialist local software vendors or away from business systems that might have been written in-house, in favour of highly functional software suites.
To add appeal to smaller companies with specialist industry needs and limited in-house IT skills, both Oracle and SAP are investing heavily in their channel and partner networks, and in providing modules tailored for smaller companies that just want to install the software and go, without much customisation.
Oracle has identified 48 industry sub-sectors for its “business accelerators” for the E-Business Suite. SAP says it has 550 “micro-vertical solutions” for its mid-market All in One software application and 300 industry-specific add-ons for its Business One offering.
These, the two companies argue, remove much of the need for custom coding but also make them far more competitive against smaller software vendors that have focused on niche markets, especially in ERP.
Both companies have been investing significant resources over the past few years in bolstering their products and technologies for the small and mid-sized business. So far, industry observers suggest that SAP has the edge, but it is an increasingly close-run race.
“SAP has spent more time focusing on developing software for the needs of the small and mid-sized business market. They have had more of an opportunity to refine their strategy,” says Bob Anderson, Gartner’s vice- president for research covering the SME market. “The comeback from Oracle would be that they have sold successfully into that market for years and years.”
SAP’s head start reflects the company’s focus on its core software product, ERP. Oracle has long sold technology, especially its database, to smaller companies. The challenge for the US software company is to persuade those customers to buy its business applications too.
Oracle’s software offering is undoubtedly broader than SAP’s, following Oracle’s acquisitions of Peoplesoft, JD Edwards and Siebel. But the gap is narrowing between the two companies. Most mid-sized businesses will find most of the software they are likely to need from either supplier.
This puts the head of IT or managing director of a small or mid-sized company in a stronger position than ever before. Not only are smaller companies being courted by both Oracle and SAP, allowing them to play one off against the other, but they have also attracted the attention of Microsoft.
Analysts say that Microsoft has a strong proposition for small and mid-sized companies, not least because it can provide the operating system, the database and the business applications all from its own stable.
Microsoft cannot, however, point to the same roster of large enterprise companies for its business applications. Microsoft is positioning itself in the mid market, whereas SAP and Oracle argue that they are providing enterprise capabilities at a small business price.
“Small businesses are not necessarily less complex than larger companies; it is about the complexity of their business processes,” says Donna Troy, SAP’s executive vice-president for the global SME market.
“Something as simple as a small winery – which is one of our customers – has complex processes,” she says. She argues that buying from SAP, rather than a niche vendor, also gives companies more room for growth, especially if they want to enter into export markets.
“Just because a company is smaller doesn’t mean that it doesn’t need the complexity of our product. It is a question of simplifying the implementation,” says Tony Kender, Oracle’s senior vice-president for application sales support. “We allow them to have the best industry solutions.”
It is a compelling argument. But in the case of both vendors, SMEs need to take two critical factors into account: the strength of the vendor’s local channel and whether they buy into Oracle and SAP’s approach of selling software as all-singing, all-dancing suites.
“One of the downsides [of Oracle and SAP] is that you have to commit to the idea of a large, integrated suite,” says Jim Shepherd, senior vice-president of research and a specialist in enter- prise applications at AMR Research. “You can no longer really buy applications such as inventory control or order management or purchasing one by one.”
Although Oracle and SAP both say that they do sell applications on an individual basis, in effect they turn on or off modules in a larger suite of applications rather than licensing stand-alone code. This could make the application hard for the company to manage.
Both companies are trying to address this through closer collaboration with their reseller channel. Channel partners are closer to local markets and should be better able to deal with the needs of smaller companies.
The risk is that a business might find its local channel partner falls short of expectations. CIOs face a double challenge: picking the right vendor and the right reseller. This is a point smaller companies should not neglect, however appealing the software on offer, says Gartner’s Bob Anderson.
“If there is a partner involved, then you should do your due diligence on them as well as on the software vendor,” he advises.
Copyright The Financial Times Limited 2006
For enterprise software giants Oracle and SAP, the mid-sized and smaller company is not just the next sales opportunity. It is set to be the greatest driver of their growth.
In June, SAP booked the 10,000th customer for its Business One package for smaller companies. It says sales to small and medium companies are contributing to its double-digit growth in turnover. Oracle has set itself tough targets for increasing sales to SMEs, executives say.
Both software companies want to win custom for their enterprise resource planning, financial, supply chain, customer relationship management and other business- critical software.
They are hoping to draw smaller companies away from specialist local software vendors or away from business systems that might have been written in-house, in favour of highly functional software suites.
To add appeal to smaller companies with specialist industry needs and limited in-house IT skills, both Oracle and SAP are investing heavily in their channel and partner networks, and in providing modules tailored for smaller companies that just want to install the software and go, without much customisation.
Oracle has identified 48 industry sub-sectors for its “business accelerators” for the E-Business Suite. SAP says it has 550 “micro-vertical solutions” for its mid-market All in One software application and 300 industry-specific add-ons for its Business One offering.
These, the two companies argue, remove much of the need for custom coding but also make them far more competitive against smaller software vendors that have focused on niche markets, especially in ERP.
Both companies have been investing significant resources over the past few years in bolstering their products and technologies for the small and mid-sized business. So far, industry observers suggest that SAP has the edge, but it is an increasingly close-run race.
“SAP has spent more time focusing on developing software for the needs of the small and mid-sized business market. They have had more of an opportunity to refine their strategy,” says Bob Anderson, Gartner’s vice- president for research covering the SME market. “The comeback from Oracle would be that they have sold successfully into that market for years and years.”
SAP’s head start reflects the company’s focus on its core software product, ERP. Oracle has long sold technology, especially its database, to smaller companies. The challenge for the US software company is to persuade those customers to buy its business applications too.
Oracle’s software offering is undoubtedly broader than SAP’s, following Oracle’s acquisitions of Peoplesoft, JD Edwards and Siebel. But the gap is narrowing between the two companies. Most mid-sized businesses will find most of the software they are likely to need from either supplier.
This puts the head of IT or managing director of a small or mid-sized company in a stronger position than ever before. Not only are smaller companies being courted by both Oracle and SAP, allowing them to play one off against the other, but they have also attracted the attention of Microsoft.
Analysts say that Microsoft has a strong proposition for small and mid-sized companies, not least because it can provide the operating system, the database and the business applications all from its own stable.
Microsoft cannot, however, point to the same roster of large enterprise companies for its business applications. Microsoft is positioning itself in the mid market, whereas SAP and Oracle argue that they are providing enterprise capabilities at a small business price.
“Small businesses are not necessarily less complex than larger companies; it is about the complexity of their business processes,” says Donna Troy, SAP’s executive vice-president for the global SME market.
“Something as simple as a small winery – which is one of our customers – has complex processes,” she says. She argues that buying from SAP, rather than a niche vendor, also gives companies more room for growth, especially if they want to enter into export markets.
“Just because a company is smaller doesn’t mean that it doesn’t need the complexity of our product. It is a question of simplifying the implementation,” says Tony Kender, Oracle’s senior vice-president for application sales support. “We allow them to have the best industry solutions.”
It is a compelling argument. But in the case of both vendors, SMEs need to take two critical factors into account: the strength of the vendor’s local channel and whether they buy into Oracle and SAP’s approach of selling software as all-singing, all-dancing suites.
“One of the downsides [of Oracle and SAP] is that you have to commit to the idea of a large, integrated suite,” says Jim Shepherd, senior vice-president of research and a specialist in enter- prise applications at AMR Research. “You can no longer really buy applications such as inventory control or order management or purchasing one by one.”
Although Oracle and SAP both say that they do sell applications on an individual basis, in effect they turn on or off modules in a larger suite of applications rather than licensing stand-alone code. This could make the application hard for the company to manage.
Both companies are trying to address this through closer collaboration with their reseller channel. Channel partners are closer to local markets and should be better able to deal with the needs of smaller companies.
The risk is that a business might find its local channel partner falls short of expectations. CIOs face a double challenge: picking the right vendor and the right reseller. This is a point smaller companies should not neglect, however appealing the software on offer, says Gartner’s Bob Anderson.
“If there is a partner involved, then you should do your due diligence on them as well as on the software vendor,” he advises.
Copyright The Financial Times Limited 2006
Thursday, October 12, 2006
Monday, October 09, 2006
The AMR Research Interview: SAP’s Henning Kagermann on the Future of Software (AMR)
Last week we had the opportunity to sit down with SAP’s Henning Kagermann in a conference room outside his office at company headquarters in Walldorf. Our meeting occurred during the closing days of the third quarter, a time when many software executives are completely distracted by pending deals. Not Mr. Kagermann, he appeared calm and serene.
Thursday, October 05, 2006
SAP Announces Java EE 5 Compatibility Ahead of Main Rivals (Gartner)
SAP's achievement of Java EE 5 compatibility demonstrates its renewed commitment to standards and reinforces the industry's commitment to Java. It also supports SAP's strategy to develop its ecosystem.
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