At last year’s SAPPHIRE in Orlando, Fla., Henning Kagermann, chairman of SAP’s executive board and CEO, predicted that cost-cutting would not succeed as a strategy for growth and recovery. To make financial gains and win market share, he said, companies must focus on innovation and not just on slashing expenses.
Kagermann was right. At SAPPHIRE ’04 in New Orleans, he shared statistics that confirmed the accuracy of his 2003 prediction. For example, Kagermann said that in 2003 SAP it upped its own spending 9.2 percent to $1.2 billion. And it increased its market share to 59 percent, the highest number ever.
That’s proof positive that when a company puts more money toward innovation, its business grows. Kagermann also pointed to other companies using SAP NetWeaver as a tool for success. Kimberly-Clark, he said, runs SAP to get products to market faster. Another company, a $10 billion auto parts maker, uses SAP solutions to speed up manufacturing. Those examples illustrate his point; innovative, SAP-based IT systems can help a company grow and achieve strategic goals.
Some 8,000 SAP customers and partners listened to Kagermann’s opening keynote as well as later keynotes by SAP co-founder and former co-CEO Hasso Plattner and SAP executive board member Shai Agassi. All three said the time has come to replace traditional client-server systems with Web-centric enterprise services. It’s a shift from SAP R/3 to the new mySAP ERP, based on SAP NetWeaver.
Customers Tout SAP Success Stories
One session, “Government Solutions at Work,” brought together IT managers from a variety of public agencies. It featured representatives from the state of Washington, and the city of San Diego, California, as well as the government of Israel, talking about their implementations of Web portals and other SAP-powered Web services.
In San Diego, a new SAP-based system lets citizens put in requests online for street repairs. Elizabeth Mueller, information systems manager for the Street Division in San Diego said the results were dramatic. About 1,000 requests for repairs poured in online in one month. Before the Web tool was added, the Street Division received just 30 requests per month.
The San Diego SAP project has been in progress for about four years and also includes an online mapping tool. Employees can see visual representations on maps of where equipment and personnel are located, as well as where repairs are needed. That makes planning and managing the tasks much easier, Mueller said. It reduces redundant work orders and scheduling mistakes.
Another session, “Transforming the U.S. Navy: Integration to Protect the Nation,” featured Ronald Rosenthal, ERP program manager for the Navy. Between 1999 and 2003, the Navy launched four SAP pilots and is now in the midst of broad deployment of those SAP solutions. “We’re looking for transformational changes in the way we do business,” he said.
Rosenthal said the Navy’s SAP implementation has helped the organization cut logistics costs and equipment repair time and has slashed transaction errors. As examples he cited a 16 percent reduction in equipment repair time, from 96 to 81 days, due to more efficient IT processes. He also cited an aviation inventory supply error rate of a low .5 percent, also due to process improvements.
The Navy’s SAP deployment is scheduled to last until 2014, but Rosenthal said it probably would be complete by 2011. So far the SAP implementation has been “a real big success story,” he said.
SAP NetWeaver and .Net
Some of the biggest news at SAPPHIRE ´04 was made by SAP and Microsoft. With a deepening of its 10-year partnership, the companies are improving integration between SAP NetWeaver and Microsoft’s .Net architecture.
Components of the agreement include:
- The SAP Enterprise Portal software developer’s kit for .Net, set to be available in August. It will and will allow software developers who use Microsoft Visual Studio.Net to integrate applications, such as Microsoft’s Excel, with SAP Enterprise Portal.
- The SAP .Net Connector, a soon-to-be-released component that will link SAP and .Net applications.
- A jointly operated SAP-Microsoft support center, based in Walldorf, Germany, where SAP is headquartered.
According to a research note released by Boston-based AMR Research, “Fundamentally, this will make the interoperability between the applications from SAP and the infrastructure from Microsoft easier.”
SAPPHIRE ´04 product announcements included SAP for Defense & Security, for defense forces, border patrols and emergency response personnel, and SAP for Logistics Service Providers, for the outsourced logistics industry. And SAP Global Trade Networks (SAP GTS), a partnership between SAP and FedEx, gives companies access to worldwide duty and tax data and access to SAP NetWeaver to automate and standardize trade processes.