In-Depth

SAP Speaks Softly, but Carries a BIg Stick

SAP’s understated business intelligence strategy is a study in contrast with that of its chief rival, Oracle.

• By Stephen Swoyer
• 04/05/2006

In many respects, SAP AG is the anti-Oracle—the German ERP giant is often understated in ways that the U.S. database powerhouse is not.

For example, last month Oracle announced its first-ever Oracle Business Intelligence Suite product, which incorporates analytics capabilities Oracle acquired from the former Siebel Systems Inc. In promoting its new business intelligence (BI) suite offering, Oracle took the fight right to the BI pure-plays, arguing—in effect—that its ERP, database, and applications experience functioned to give it an especial insight into BI.

SAP could credibly make the same claim—perhaps even more so than Oracle. But the German ERP giant’s strategy has instead been content to quietly flesh out its own Netweaver-based BI stack, even as it downplays its own ambitions in the broader business intelligence marketplace.

This summer, SAP plans to augment its BI stack by releasing more than 200 industry-specific, canned analytic applications. This month, select customers will get a chance to deploy these apps, with general availability slated for August. SAP calls the new analytic offerings “composite” applications, which means (essentially) that they’re portal-powered applications cobbled together from Web services, enterprise services, and traditional applications and data sources. They were built, says Roman Bukary, vice-president of composite and analytic applications for SAP, using NetWeaver’s Visual Composer design environment.

“We’ve talked about unifying people, processes, and data, and we don’t really care where this data is coming from—whether it’s SAP or non-SAP,” he comments. To that end, Bukary explains, SAP “built something inside NetWeaver that we believe to be extraordinary and leading-edge, and that is a design environment called Visual Composer. It’s basically a tool that helps [users] design applications, not to write [i.e., code or program] them.”

SAP’s analytic push didn’t just happen over night. At its Spring SAPPHIRE user conference last year, for example, SAP first outlined its vision for a new generation of composite analytic applications. The ERP powerhouse quickly went to work, says Bukary. “By late October [of 2005], we took those applications and put them in a pilot phase. SAP normally does not do pilots, and here we did a pilot because it was a different way of building software and releasing software, and… we had customers who actually went live with pilot software, this pre-ramp up software.” (http://www.tdwi.org/News/display.aspx?id=7746)

The response to the pilot program in SAP’s analytics-starved user community has been encouraging, Bukary claims.

“These customers were going live with the pilot software, and the reason they were going live is that [they were saying] ‘This is what we’ve been waiting for, to really give our biz people the ability to see and act at the same time,’” he says. “So [this month] we’re going to take these applications and put them into ramp up. The product has been deemed to be commercially ready, but we have controlled availability, because we don’t want to simply throw them over the wall and say, ‘Here they are!’ We want to make sure that any issues can be immediately corrected, make sure that not only can we build software differently [using this composite model], but we interact differently with our customers.”

Technology pessimist Nicholas G. Carr has famously argued that IT is (in a single word) irrelevant; or, in other words, that the very ubiquity of IT has helped demythologize it. In Carr’s account, organizations no longer embrace information systems for competitive advantage, i.e., as a means to differentiate themselves from their competitors. Instead, they do IT because it’s a competitive necessity. Take ERP, for example. All large enterprises run ERP systems, and for this reason some analysts argue that the selection of an ERP vendor is itself irrelevant. The same has been said—albeit less convincingly—about BI.

In this respect, Bukary argues, BI—or, more specifically, composite BI analytics—can be a game-changing technology. “In a world of composite applications, the difference between your business and mine is in fact the difference of how effectively we leverage the insights available to us, and how effectively my people … [are] enabled to do the right thing in their jobs,” he comments. “So it becomes [a question of] competing on analytics, because competing on manufacturing efficiency, that’s a losing proposition—someone will always go one step lower than you. But if you have the best design environment, a tool like Visual Composer, you can build these composite [analytic] applications that give you an advantage over your competitors.”

On paper, SAP’s composite app push appears to contrast with (if not fly in the face of) the Office-centered Mendocino initiative it announced last year in tandem with Microsoft Corp. Composite analytics are lightweight, portal-powered applications; Microsoft’s Office productivity suite, on the other hand, has in the past been derided as the very model of application bloat. Bukary, for his part, says the two aren’t necessarily antithetical models. In a certain sense, he argues, the latter—which consumes services from SAP applications and heterogeneous data sources—is an instance of the former.

“Although Mendocino and analytics look a little different, when you strip away the façade, at their core, they’re very similar. They both bring the data and the processes to where the data lives; they [both] rely on NetWeaver the platform in order to make the magic happen,” he comments. “It’s not simply about Microsoft, it’s a matter of a mind-shift that says, ‘We’re not going to ask the user to adjust to software; the software must be smart enough to adjust to the user.’”