During Thursday's SAP channel partner summit held at the Hilton Hotel in this city, executives described AP as a "great potential" for the subscription-based hosted delivery model for customers.
Robert Vetter, senior vice president of SAP's business development SME and business all-in-one go-to-market strategy, said subscription-based hosting is a new consumption model, with only about eight to 12 weeks implementation time. It involves SAP certified partners and is offered at a subscription-based pricing or pay-per-user per month.
"Customers now expect a package and not just a solution with no pre-define scope but quick implementation, training, services, maintenance and is offered at a fixed price point," said Christopher Knoerr, vice president, indirect channels SME, SAP AP and Japan.
According to Tom Kindermans, senior vice president for SME, SAP Asia-Pacific, the company's strategy since the past years is consistent -- zooming in on SMEs. "It's about the instant value of implementation and speed is a valuable proposition," he said, describing subscription-based hosting as "sales-on-demand" which has transparency, continuity and is not disruptive to the business.
Kindermans said SAP is looking forward for its portfolio expansion which he termed as "best fit solution portfolio" -- and they are SAP All-in-One, SAP Business Objects, SAP Business ByDesign, and SAP BusinessOne.
He said portfolio expansion is just one of SAP's three key pillars to address the SME market. The two others are brand expansion and channel expansion or channel partner and open ecosystem.
"Our mission is to provide instant value to people everywhere, and with our current status of 35 million users, we provide solutions that impact the world," Kindermans claimed, citing SAP is involved with the daily production of 40 million barrels of oil, retail outlets transactions totaling $330 million, production of 32,000 car engines, processing of 2.5 billion utility bills per day, and the 65% of worldwide annual chocolate production (2.2 million tons), to name a few.
Kindermans explained the change of customer behavior is based mainly on their expectations to have lowest cost of ownership, ease of use, fast time to value, end-to-end solution and that IT has now become an OPEX (operational expenditure) instead of CAPEX (capital expenditure). He added SAP's product strategy will allow for different speed of innovation and ease of consumption.
Knoerr announced they intend to offer SAP packaged solutions with the help of the company's value added resellers (VARs) that leverage SAP's SME solutions and build packages that deliver fast time to value at attractive costs for the SME.
Giving a clear view of the packaged solution, Knoerr said among those offered at a fixed price point are the fixed number of users (licenses), fixed implementation scope, end-user training and documentation, the hardware plus database, and the annual support on the first year which is optional.
"Our plan to expand coverage is to hire more sales people and recruit more partners," Knoerr said, adding SAP is now engaged in the professional enablement of VARs through their partnership with the PDAgroup, a network organization that enables best performance of professionals.
Kindermans noted in the summit that 60% of SAP's SME business is done through their partners and the company is now eager to invest more in them.
"Indirect partner business will grow 30% [in 2010] and smaller deals will move to inside sales in combination with our partner engagement," he said.