SAP takes on Microsoft, seeks to boost U.S. sales
NEW YORK (Reuters) - Europe's top software maker, SAP AG, on Wednesday revealed plans to take on Microsoft Corp. in the small-business market as part of a plan to boost weak sales in the United States.
Despite having strong ties to U.S.-based multinationals and other global companies, SAP has failed to tap the wider U.S. market, especially among small and medium-sized businesses, the new head of its global operations said on Wednesday.
Making matters worse is the chronic slowdown in technology spending, which has hurt SAP's U.S business in particular. Officials reiterated that business conditions were likely to remain challenging for the next six months.
SAP is hoping a recent shake-up of its U.S operations -- combined with a new software package introduced on Wednesday -- can help it crack open the mass market for its business software. It hopes the move will allow it to take market share from leading U.S. rivals Microsoft, Oracle Corp. and Siebel Systems Inc..
"One of the things I am going to do here is change the culture to focus much more on our customer relationships, not only for the very large customers ... but also for what I would call our local key accounts," Leo Apotheker, the new head of SAP's global sales operations told Reuters in an interview.
"Companies who are not necessarily among the top 50 largest companies in the world but who can still generate substantial business for us," he added.
SAP is the world's largest supplier of software that big companies use to stitch together their financial, human resources and manufacturing operations. It is also going after new markets that help link companies with their suppliers over the Web.
Apotheker, also the interim chief of SAP's North American organization, said his aim was for U.S sales to represent about 40 percent of SAP's total revenue within the next couple of years, up from about 35 percent now.
As part of that strategy, SAP on Wednesday unveiled a new, scaled-down version of its suite of business software targeted at the small and medium-business market -- companies defined as 1,000 employees or less.
The software, called SAP Business One, is aimed squarely at the same market Microsoft is targeting with its planned acquisition of European software company Navision, and its purchase of Great Plains Software in 2000.
The move is also part of SAP's drive to make its software systems -- long criticized for being too complex and too expensive -- much easier for businesses of all sizes to use.
To that end, SAP said it would work to cut out hundreds of redundant features from its multitude of software programs. It also has redesigned the front end of its software, which office workers see when they switch on their computers, to make it easier to use.
Co-Chief Executive Hasso Plattner said eliminating complexity was part of its drive to make its systems easier for customers to link with other systems, as well as making them cheaper and faster than rival products.
He called on competitors to also simplify their systems.
"I will ask Mr. Bill Gates to change his opinion about what is allowed to be around Windows and what is not," Plattner said referring to Microsoft's co-founder Bill Gates. He made the remarks during a two-hour speech to kick-off SAP's annual U.S user conference taking place in Orlando, Florida.
Plattner said technologies such as Sun Microsystems Inc.'s
Java now had become a standard part of the software development process, but that Microsoft's lack of support for Java was forcing users to make a difficult choice.
"I want to say, like a famous American once did, 'Mr. Gates, tear down this wall!"' Plattner said, referring to a speech by U.S President Ronald Reagan in 1987 before the Berlin wall had come down.
Microsoft did not return calls for comment.
Shares of SAP, which closed down 1.13 percent to 109.50 euros (approximately $103) in Frankfurt trading earlier on Wednesday, later bounced back in trading on the New York Stock Exchange, ending up 1.45 percent at $26.25.