Look Out Siebel: Here Comes mySAP CRM 4.0
SAP’s much-anticipated mySAP CRM 4.0 took center stage at SAPPHIRE, even though it’s not due for general distribution until November. It’s a hefty release--in fact, SAP executives compared the achievement to the R/3 3.0 release in terms of depth and completeness, since it represents the first full-function, cross-industry CRM product from the vendor.
From a market standpoint, the release goes a long way to eliminate the last significant product advantage CRM leader Siebel had over SAP: vertical functionality. Siebel still has deeper and, in some cases, more proven capability in key industries, but SAP has begun to reestablish within CRM the deep industry advantage it enjoys in ERP.
Industry improvements
The release touches many industries, but the four most significant improvements can be found in the following:
- Consumer Products -- SAP holds a dominant position among the large global consumer products manufacturers, and the SD module sets the standard for support of product, customer, and sales organization hierarchies and advanced pricing (discounts, rebates, and trade fund rules definition). However, SAP never supported the important customer-facing trade promotion management process, until now. Finally, SAP has invested in trade promotion and delivered a serious release based on significant joint development with two customers. The Bottom line: The product is by no means complete and needs some work on usability, but it’s a very attractive option for SAP customers that want to capitalize on their deep investment in R/3 and SD.
- Life Sciences -- Again, SAP dominates Life Sciences based on deep industry functionality throughout ERP, but never supported the sales and distributor processes. In 4.0, SAP delivers support for 21 CFR Part 11 requirements for fully auditable sample management processes, including mobile support for digital signature capture and inventory tracking. SAP now also offers prebuilt cubes to detail IMS prescription data and improved sales usability. Beyond sales, SAP has finally capitalized on the acquisition of Infinite Data Structures (IDS) to create chargeback, rebate, and contract management capability that supports the dysfunctional relationship between distributors, group purchasing organizations, and hospital chains. The Bottom line: The product is all that pharmaceutical companies need to evaluate for chargeback functionality, but only consider the sales functionality for midsize deployments.
- Automotive -- SAP has made significant changes to the data model to support the three-way relationship of the vehicle, the customer, and the dealer. The data model changes let SAP put underrated direct marketing and customer service capabilities to use. SAP has clearly improved its functionality, but it lacks a sufficient dealer connectivity story and ability to capture, organize, and normalize multiple streams of customer and inventory information coming from multiple external sources. Outside of traditional CRM, SAP is exploiting its SCM advantage in delivering global inventory visibility to the dealer to include inventory in channel, distribution, and production. The Bottom line: The product best suits smaller OEMs and import operations, or a major OEM that is ready to move to a more integrated system environment and willing to sacrifice functionality and depth for integration.
- High-Tech Manufacturers -- Of all the new vertical extensions, the high-tech sales and channels system is by far the strongest and deepest of the 4.0 release. The functionality spans design registration, channel collaboration, ship and debit, special pricing requests, channel inventory management, price protection, and POS data reconciliation. The release is also supported by several important references. The Bottom line: Its evaluation is a must for SAP and non-SAP customers.
Beyond vertical capabilities, mySAP CRM has several other key attributes worth noting:
- Usability -- SAP makes strides on the usability front by making further use of the SAP Portal and introducing a totally redesigned interface for Customer Interaction Center (CIC). However, it’s more than a pretty face, and early benchmarks suggest improved performance.
- NetWeaver -- It’s the answer to the significant integration and data management problems CRM users face. The CRM suite takes the most advantage of the NetWeaver stack of any of the mySAP product lines. The biggest impact will come as users uncover the power of Master Data Management (MDM) to construct an application-independent customer data model and the messaging to share customer data with an application or customer touchpoint.
- xApps -- The 18 released SAP xApps mean very little to the customer-facing world today, but every best-of-breed vendor should take notice. SAP has historically been a slow follower at best, allowing significant new markets to emerge before coming up with its own. The inability to support innovative customer needs forced good and loyal customers to turn to best-of-breed vendors to satisfy their needs. Now, xApps offer SAP and its customers a method to compete quickly and deliver innovation to customers outside of the normal delivery cycles.
SAPPHIRE was a powerful showcase of SAP’s product and technical progress against once-significant gaps, but it came up short in demonstrating market leadership in CRM. Ironically, the road to leadership will require SAP to blow up its existing approach to CRM and redefine its development effort and product lines according to business processes, not artificially defined application markets. SAP is not currently using its advantage to create new composite applications that blend pieces of CRM, SCM, PLM, and ERP for new and existing processes. SAP’s blended product approach to Service Management is a glimpse of the potential power, but it represents only one of many such efforts SAP should be undertaking. Only when SAP can deliver on the promise of cross-functional integrated processes will it be head and shoulders above any single product vendor.
AMR Research originally published this article on 20 June 2003.