SAP is building a partner ecosystem to seize a unique opportunity in the small and midsize business market.
SAP has a unique opportunity to work with partners and harness the power of SAP cloud-based ERP technology for the benefit of small and midsize businesses, says Julie Slocum Bennani, the recently recruited head of Small and Medium Business Partner Ecosystem for SAP Ariba.
“Cloud ERP adoption is one of the last ‘workloads’ to move to the cloud because it’s so core to the business,” she says. “It’s the backbone of running a business.”
SAP has two ERP offerings targeting the SMB market: SAP BusinessOne and SAP Business ByDesign.
“SAP Business ByDesign is our public cloud hero offering in SMB,” Julie says. “It will scale down to around 20 customers, but we’re positioning it higher than that. The difference between SAP Business One and SAP Business ByDesign is that SAP Business ByDesign was architected and designed as a public cloud offering with multi-tenant capability whereas SAP Business One is single tenant and more focused on premise,” she explains.
“SAP Business One has been a successful offering for companies that want to run ERP on premise, But now, cloud ERP adoption is really accelerating in the commercial space. IDC is quoting a 35 percent year-over-year growth currently.”
From a scalability, security and ‘being current’ perspective, she says it is much easier for a small or midsize business that probably doesn’t have a full-time IT person, to use a cloud ERP offering like SAP Business ByDesign.
Unlike some competitors, Julie notes that SAP’s ERP products for the SMB market are finished, tested and form an integrated core for customers. “The value comes from the customer integration and how it gets configured and customized for that customer based on their specific needs and business model,” she says.
“In a lot of the areas that we cover from an ERP perspective, whether it’s supply chain or the financial systems, the way companies set up their systems becomes their competitive advantage, i.e., secret sauce.”
Julie also underscores that SAP cannot possibly serve the huge SMB market by itself.
“In order for a technology vendor like SAP to reach all the SMB customers in a way that maximizes the business value that they get from that technology (good ROI with quality), you have to do a very good job of building a vibrant and committed quality partner ecosystem,” she says. “It is not feasible for us to put feet on the street for every single customer.”
In working with partners, she argues that SAP “must be end customer-focused at all times and focused on the business outcomes we want and they need.”
And she has ambitious plans for growing SAP’s share of the SMB cloud ERP market. “Our plan for this year is to grow SAP Business ByDesign triple digits from a revenue perspective. Our strategy to grow this business is we’re doubling down our development investments and increasing our marketing investments 10x to generate awareness and demand. We’re coupling that with building out a more vibrant, proactive partner ecosystem than we have today.
“We are committed to ERP for SMB customers and we are expanding the commitment around SAP Business ByDesign to serve that. It is the foundation for us to build a much richer ecosystem of partners in addition to SAP BusinessOne.
“We go to market with partners and partners need to be engaged from the time that we start talking to customers, shaping the solution they want (i.e. pre-sales), all the way through implementation. Frankly, we also want partners involved post deployment to help that customer get the most out of their investment and ensure customer success, as well as understand if they have additional needs.”
The opportunity for partners, she says, is to take advantage of this momentum in SMB and jump in with SAP – come to the SMB Innovation Summits, learn about SAP Business ByDesign and SAP Business One and start to build your practice,” she says. “Take advantage of the Cloud Choice Profit model which will allow you to leverage SAP’s sales engine or sell on your paper.”