Johannesburg, 27 May 2011
Analyst firm Gartner has expressed confidence in South African organisations utilising SAP products. However the analyst firm calls on local businesses to come to grips with SAP's roadmap as well as the changes it is undergoing.
In an interview with ITWeb, Thomas Otter, research VP from Gartner, said SAP has a strong presence in SA, as a lot of local organisations are seeking Gartner advice on an array of SAP products.
Otter, based in Germany, is in SA for the Gartner on SAP event to be held on 1 and 2 June in Sun City.
“Gartner has been assisting a lot of businesses in understanding the SAP roadmap and explaining to them what SAP is doing right and what it is doing wrong,” said Otter.
He noted that SAP has a bolder and more coherent vision for its technology strategy than it has had since 2006.
“This companywide vision encompasses the traditional SAP NetWeaver-labelled products, technologies derived from the Sybase acquisition and new technologies under development, such as Project River and Project Gateway.”
Despite the strength of its vision, SAP's products often vary in strength, he added. “While the company stands out in many product categories, it trails market leaders in others.”
Procurement demands
He also urged businesses to carefully study potential SAP additions before procurement. “Seek out offerings that are proven, effective solutions to meet business demands. Don't overlook other technologies just because your organisation's legacy systems are SAP products.
“Simply choosing SAP applications or technology because you are an 'SAP shop' is rarely a good strategy.
“CIOs, IT leaders and procurement managers must fully understand the strengths and shortcomings of each SAP product when making strategic buying decisions, or risk misusing technology budgets,” he said.
According to Otter, Gartner has about 100 analysts who cover SAP in various ways to assist organisations in understanding the different solutions the organisation offers.
He noted that there are three pillars to the SAP strategy, namely on-premise, on-demand and on-device.
“By on-premise, they refer to the traditional operating platforms, while on-demand refers to new products like cloud computing that businesses are demanding. On-mobility targets devices such as mobile.”
Otter pointed out that most South African organisations are anxious to tap the full potential of SAP. “They often have questions like: 'how do I make the most of ERP, BI, analytics and CRM?”
Nonetheless, he noted that the situation in SA in regards to SAP is not different from the other parts of the world.
He singled out the successes the local mining industry has realised through the use of SAP products. “From a leadership point of view, the South African mining sector is world-class. SAP is working with several mines in SA, especially in the field of operational risk,” Otter said.
Otter also urged local companies to continue driving down costs in their current environment while leveraging the most out of their existing systems.
“However, balancing these sometimes conflicting demands is not easy,” he stated. “Businesses should try and look for things they should stop doing in order to build a tight bridge to the business.
“Don't do something in four different ways if you can do it in three ways. Standardisation is key to proper business processes,” he said.
To strike a balance, he urged organisations to build competency centres or centres of excellence where they make full use of business intelligence.
Sybase move
Among the changes at SAP, he said the company's acquisition of Sybase was not only to boost mobility, as most people believe.
“To compete with Oracle, SAP needed to break the Oracle database dependence because when the company was still tied to Oracle, for every business it did, it meant money to Oracle,” he explained.
He added that with the Sybase buy, SAP is also building its future without dependence on Oracle. He further explained that since Sybase has a strong presence in China, the acquisition would also strengthen SAP's position in the fastest growing economy in the world.
The other justification of the buy-out, Otter said, is because Sybase is strong in terms of financial services, hence SAP was also targeting the sector.
“However, though there are challenges in the deal, Gartner is positive about the acquisition. It is still too early to talk about the successes,” he said.
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