Moving Down to Move Up

DeltaDator provides IT solutions and system integration services in Italy for banks and financial institutions, public administration, and the SMB market. The company, based in Trento, approaches each of these markets differently. For public administration it develops products itself, whereas in the SMB market it acts mainly as a reseller. Its offerings include infrastructure; reselling IBM hardware; middleware, databases, and operating systems; and providing a wide range of solutions.
DeltaDator signed a partnership agreement with SAP in July 2003 and created a department dedicated to selling and implementing SAP Business One solutions. It expects to expand rapidly with the help of Italian partner Derga, in which DeltaDator holds a controlling stake.
According to Piero Consolati, managing director, SAP Business One seemed a perfect match for DeltaDator’s customer requirements and the company’s capabilities. DeltaDator has been active for several years in the SMB area and has experience with SAP R/3.
The products which the company has developed internally have been aimed at the higher end of the SMB market. He adds that vertical expertise and products are crucial to gain ground in the SMB market, and that additional vertical functionality is a necessity. “The vendors that can offer commodity products that include vertical specialization will be the only vendors that survive,” he says, noting that SAP is one of the few that can develop and deliver commodity products.

Increased functionality

The strength of SAP Business One for the SMB market is its simplicity and limited set of functionalities, Consolati says, leaving customers fewer choices to make. Yet, he worries that it may be aimed too low, and that its functionality may be too limited. However, with SAP help, DeltaDator should be able to develop and enhance the functionality. The firm has already developed add-on functionality for the wine production, fruit production, and automotive industries.
SAP should play a leading role in creating a library of vertical applications that can be exchanged among partners, says Consolati, and should also control certification so partners can guarantee the quality to their clients.
The impact of the partnership on DeltaDator has already been substantial: The company expects to break even with SAP Business One by the middle of this year. The company’s investments have been mostly in training. Consolati sees it as especially important to have knowledge of business processes rather than of applications.
DeltaDator’s initial contract for the sale of SAP Business One was with Zelger of Bolzano, which markets acoustic equipment. DeltaDator completed the project for a fixed price, even though it needed a few extra days to learn the nuts and bolts of the product. The company is now aggressively lining up business activities to build a substantial SMB market. Its geographic area harbors many SMBs, so the company is working to expand to other cities in the region.
Besides marketing campaigns, Consolati explains that the firm is using its partnership with Derga to boost its SAP Business One business. Derga offers the opportunity to work with its installed base, which includes large clients that DeltaDator can approach to promote SAP Business One at smaller sites or branch offices.

Expanding to the international arena

“SAP is a very big company, but at the same time they are easy to deal with, and I think the interaction with SAP Italy is excellent,” says Consolati. DeltaDator currently interacts mostly with SAP Italy, but in the future he is looking to work with SAP on an international level. As he explains, “SAP Business One is an innovative solution that allows DeltaDator to reinforce our presence on the market, enrich our offering of management solutions, and respond to the requirements of companies active in international markets.”
He praises SAP for both its technical and commercial aspects. SAP worked hard at promoting SAP Business One throughout the second half of 2003, he notes, holding road shows which DeltaDator was invited to join. The campaign received extensive media coverage, and DeltaDator collected several promising leads.
Though the marketing initiatives helped DeltaDator improve its competitive position, Consolati felt early on that the product needed improvements to compete optimally. However, he says that the basics of SAP Business One (infrastructure and interface) are excellent. One comment for improvement – training tests are only available in English, so Italian-speaking consultants could not receive certification, even though they went through all the training materials.

Derek Davis
Derek Davis