SAP Has the Value Proposition

“Technology can solve problems, but technology isn’t your business. It’s ours.” Bill McDermott, CEO and President of SAP America, presented the challenges and opportunities that SAP sees for businesses in his message to attendees at the SAP Business Forum ’03 held on October 22, 2003 in Rosemont, IL. McDermott noted, “It‘s time for a change – a change in the spending for innovation.” He asked attendees to imagine what would happen if they increased their spending for innovation from 10 percent to 40 percent.

You need the courage

Jim Carroll, innovation and trend expert, reiterated McDermott’s call for innovation, and asked the audience, “Have we lost our courage to innovate?” He noted that great gains are made even by traditional companies that think outside the box, or in the case of Star-Kist, think outside the can. Tuna has been packaged in a can since 1910. Star-Kist dared to innovate, and is now realizing $200 million in new revenue with tuna in a pouch.

Rise to the top

According to Carroll, “Ever since the bubble burst, the economy has gone from irrational exuberance to irrational pessimism.” No one wants to make a decision, but companies who do stand to rise to the top of the heap:

  • Open up your supply chain. Dow Chemical is processing up to 60,000 transactions per day through its portal.
  • Use technology in new and different ways. A credit card clearing company now registers soccer clubs and tracks player attendance.
  • Reduce new hire processing time. By implementing an employee self-service application, Vail Resorts has can process a new hire in two hours, a big improvement over the five days it took without a portal.
  • Avis reduced processing costs from $7 for a customer service center call to $0.50 via automated customer self-service.
  • Malee Sampran, an Indonesian food grower, uses GIS and GPS via handhelds to monitor agricultural supplies and manage product yields.
  • Recognizing that 80% of customer calls were simple inquiries about accounts, a bank implemented customer account access via a portal.

Watch your back

Taking a lesson from Texas frogs, Carroll warns companies about being squashed like frogs on the road to profitability. Distracted by watching out for old dangers from ahead of you, new dangers and insurmountable opportunities may be approaching quickly from your backside.

Get ready for your future

Bob Anderson, Research Director for Gartner, Inc., spoke about the competitive necessity of e-enabled business management for small and midsize businesses. He stressed that SMBs must exploit their strengths of agility and transparency, while increasing their global focus and opening up their value chain to all participants – suppliers and customers.

Harness the power

Although SMBs are considered more agile in their response to new opportunities, they can be held back by antiquated or inadequate business management systems. Even those companies that are using the Internet for buying or selling products are shortsighted. According to a Gartner report, “The best-run businesses will design products collaboratively, planning across and beyond the enterprise, managing capacity constraints, and interacting with partners and larger customers across the virtual enterprise.”
To truly harness the power of the Internet and manage their value chains, SMBs must do two things well:

  • Efficiently manage their relationships with their customers
  • Optimize all costs and asset values in the supply chain

Inform and collaborate

Information is the key commodity in this equation: information to customers about products, availability, pricing, and services; and information to suppliers and partners about forecasts, product design, inventory, pricing, and availability.
True collaborative e-business requires “real-time and right-time” visibility into the value chains of suppliers, manufacturers, distributors, and customers. Gartner predicts, “Through 2005, SMBs that phase in collaborative e-business processes applicable to their objectives will be 30 percent more successful in improving profit margins and customers satisfaction (0.8 probability).”

SAP has the solutions

The SAP value proposition offers tangible benefits, enables growth, and reduces total cost of ownership. SAP products deliver value to companies of all sizes through an industry-specific, building-block approach that preserves a company’s initial IT investment. SAP can’t eliminate all the risks associated with innovation and growth. But its family of integrated and scalable products will continue to deliver value as you grow from small to midsize and beyond.
Designed for your industry, scaled for your business, ready for your future.

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Brenda Mackay
Brenda Mackay