On the Same Side

September 2, 2009 by Stephan Magura

DSAG deputy chairman Andreas Oczko

DSAG deputy chairman Andreas Oczko

SAP.info: Mr. Oczko, market researchers such as IDC attest that SAP is heading in the right direction with SAP Enterprise Support. What is it about this new maintenance strategy that concerns DSAG?

Oczko: There’s no doubt that it contains positive elements and addresses some important points. However, that doesn’t mean the direction is 100% right. And it’s not the DSAG itself that’s worried about the model; it’s SAP’s customer base. Many of our members don’t need SAP Enterprise Support because they work with older versions of systems or have other priorities at the moment. We’re in the middle of a brutal economic crisis, after all.

Budget constraints are even forcing companies to push back activities that generate value. For many of them, SAP Enterprise Support ultimately means nothing more than a heaver financial burden at a time when they need to reduce costs.

SAP.info: Is an increase in support feeds unjustified even when an improved service offers added value?

Oczko: Asking the question of what helps the customer is always a good thing, but the order in which you do so is key. In June of last year, SAP announced SAP Enterprise Support as a mandatory maintenance model for all customers, including a price increase from January 2009. It would have been better to sit down with partners first to fine-tune the portfolio and see what would benefit whom. Then customers could pinpoint their investments and achieve added value. You have to remember that plenty of them haven’t upgraded to SAP ERP 6.0; many still use SAP R/3 4.7, 4.6C, or 4.5, and some are still on 3.1. SAP Enterprise Support has nothing to offer any of these customers.

SAP.info: Do you think software companies shouldn’t be allowed to increase the price of their support? Other services get more expensive all the time.

Oczko: Everyone should increase their prices if they’re no longer suitable. Over the years, however, the feeling developed among SAP’s base customers in German-speaking countries that both sides should take each other into consideration – especially in difficult times. They expect SAP to keep the economic climate in mind and be more attentive of its longstanding business partners.

SAP.info: Has the communication between SAP and its customers changed?

Oczko: Yes, but that’s what happens in the course of a company’s evolution. When I started working in the field of SAP in 1992, you could often get technical problems solved with a phone call. However, SAP isn’t a 20-person operation any more; it handles service notifications differently than it did 17 years ago. As a company grows, the sense of familiarity in interacting with it wanes, but that’s neither the fault of SAP nor its customers.

That said, the way SAP brought SAP Enterprise Support to market didn’t sit right with a lot of customers. That’s why we need the company to show a very high level of sensitivity right now – for example, in the price of standard support or in dealing with the previous contracts of loyal customers who have always followed the SAP product strategy and want to continue to do so.

SAP.info: SAP and the members of the SAP User Group Executive Network (SUGEN) have agreed on changes to the original SAP Enterprise Support model, including the documentation of service based on substantive figures. How would you assess this development?

Oczko: Softening the price increase was a step in the right direction. Now it’s time for SAP to make the service more attractive to customers in individual countries. In the end, the numbers have to reflect the added value. We’ve only announced the key figures and a benchmarking program, which puts us at the beginning of this process.

SAP.info: What else is the DSAG asking for?

Oczko: An optional support model would accommodate the interests and requirements of customers who use releases not covered by the benefits of SAP Enterprise Support. And I’ll say it again: Now is not the time to raise prices. According to what I’ve seen, companies are delaying larger IT projects and putting the red pen to nearly everything else.

Postponing the increase in price would also provide an opportunity to justify it by working together on operational scenarios and validating the added value involved.

SAP.info: Wouldn’t individualizing support make it even more expensive?

Oczko: You’d have to consider that. I can understand SAP’s desire to put together flat-rate packages. On the other hand, however, you have the interests of individual customers. It’s about finding a compromise.

SAP.info: What do you make of the announcements independent service providers have made regarding their plans to soon offer SAP support?

Oczko: Competition drives business. However, we also advise our members to think very carefully about changing providers. For instance, you have to consider how an external company handles ongoing technical developments and who’s going to implement legislative changes in the system. No third-party provider does that. It’s clear that SAP’s maintenance fees cover more than just troubleshooting.

SAP.info: How would you summarize the discussions with SUGEN and SAP concerning SAP Enterprise Support?

Oczko: It’s hard to debate something that’s already been decided; dialog based on trust is the key to cooperation. To support this, we could found a type of advisory board to discuss plans and coordinate important steps with the customer associations. SUGEN, DSAG, and SAP are essentially on the same side, and we’ve learned how to communicate with one another. Now all we need is the right results.

Tags: ,

Leave a Reply