Sapience 2009 – Economic Survival for SAP Shops

Written December 9th, 2009 by
Categories: CEO's Blog
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I hate marketing events.  I hate producing them,  I hate attending them, and I hate how they suck up energy after I get home.  But I was glad to support Helmuth Guembel in his courageous effort to stage Sapience 2009.  I say courageous because you’ve got to be a little crazy to launch a new event in these economic times, especially one that is trying to break new conceptual ground.

Helmuth alone will have to gauge whether he can declare victory on this version 1.0 effort.  However, for the industry’s sake, I hope he does.  He has crafted a very pragmatic vision that is relevant to every SAP CIO, and has done a great job recruiting vendors and assembling an agenda and speakers to support it.  As Helmuth pointed out in his opening keynote presentation, the dynamics of the SAP market are in the midst of great change. When all the dust settles, free market forces will have evolved all SAP shops to be leaner, less dependent on monopolistic rule and more dependent on the cloud.  Sapience 2009 is not only amplifying the SAP market’s evolution but, in no small way, actually engineering it.  From a purely selfish standpoint,  I hope Helmuth gets the support he needs to continue on with his efforts!

I still have a second day of meetings to attend, but if I were an SAP customer, my price of admission would have been recovered many times over just by meeting Rimini Street, Panaya and netnet.  Between these three vendors, you could save 80% of your SAP support costs, 50% of your upgrade costs, and up to 90% of your lifetime maintenance costs, respectively.

The key to changing markets (and governments) is transparency of information.  That’s a highlight of Sapience 2009.  Getting the inside story from current and past vendor Executives, analysts and CIOs in such a concentrated way, certainly help form your own opinion on the future trajectory of the SAP ecosystem.

Here are a few of the tidbits that I picked up…I wonder if that’s because they reinforce b2b2dot0’s positioning 🙂

According to Helmuth, if you want to make it through this recession, do the following:

  • Review all projects greater than 12 months old – make sure you’re working on high value projects
  • Break all projects into smaller increments.
  • Before you turn on shelfware (there is a lot of it out there!), check your options.  Implementation may be too expensive.
  • Avoid one stop shopping.
  • Look to make purchases with operational expenses not capital expenses
  • Check out niche vendors (that’s us!)

There were other great quotes that I wrote down over the course of the day that I’d like to share:

Paul Wahl (ex SAP USA CEO) –

“ERP was never meant to be wall-wall, from order to cash.”
“This business model of perpetual licenses and maintenance will eventually break”
“Fundamental shift in the industry (SaaS) is outsourcing upgrades to your vendor as opposed to customers being responsible for upgrades.”

Craig Conway (ex PeopleSoft CEO)

“ERP succeeded, but might have cost more than people thought”  (there is an understatement!)
“The real benefit of the cloud is instantaneous upgrades”

Jan Baan (Founder of Baan software and Cordys)

“Focus on niche.  Take best of breed solutions and keep them vanilla”
“You only change the company when there is pain.  Profits too high make a company lazy.”
“From senility comes “good is good enough”” (speaking about why mature companies don’t innovate)

Neil Herman (Financial Advisor)

“SAP has become a legacy vendor living on maintenance revenue”

That’s it for now.  I’ll hopefully post a show wrap up when I get home.  There is that giant sucking sound stealing more of my time away 🙂  Marketing events.  You gotta love ’em!

Sam