IBM's Lotus Notes for SAP Strategy: How About A Little Trash Talk Among 'Friends'
IBM and SAP talk a lot about how much they love each other, at least when it comes to DB2 (one of the “Oracle killers” in the SAP arsenal) and the billions that SAP work brings in for IBM’s Global Services consulting group. But behind the love is some serious competition from IBM’s software group directed squarely in SAP’s direction, complete with a fair amount of spin about who’s the best positioned to bring new innovative composite applications to their mutual customers’ desktops.
Of course, IBM's offering isn't free either. They're spinning.The background to this love/hate relationship started with the birth of IBM’s On Demand strategy three years ago. In late 2003 I wrote a report that discussed IBM’s quest to move to the top of the innovation food chain, very much at the expense of the composite applications strategies of “partners” like SAP and Oracle. The strategy was simple: unleash IBM’s Global Services consultants to create custom applications, based on its WebSphere technology, that would provide the “innovation layer” on top of enterprise applications – from SAP, Oracle, and the like – that IBM saw as legacy, and therefore, less-than-innovative systems.
IBM’s recent announcement that it would aggressively productize this strategy for its Lotus Notes customers – by unleashing a set of tools on the market that facilitates the use of Notes as a front-end to SAP, and other unnamed enterprise applications – follows very much this line of thinking: Capture the innovative high-ground with IBM software that “unlocks the value” of SAP software, which by implication, is in need of a little locksmithing from IBM.
It’s important to note that the new Notes attack is being targeted most directly at SAP customers, and was positioned to be announced the week before SAP’s Sapphire user conference. Important because it’s clear that this strategy works with lots of non-SAP software, which begs that eternal question: why is IBM partnering with SAP while it is aggressively trying to bury SAP’s innovation strategy – which includes SAP’s recently announced Duet/Outlook composite user interface work with Microsoft – behind a retaining wall of IBM innovation?
The language of the announcement is telling, coming from a partner that is highlighting its strategic partnership with SAP and Sapphire this week. During a webcast to analysts to announce the Notes strategy, IBM VP Larry Bowden talked about “unlocking value” more than once, and the slide deck IBM sent out to analysts talked about “SAP customer pain points” in less than flattering terms. And, despite the SAP-attack focus of the announcement, the key use-case slide actually showed only two examples that use SAP as their data sources (the other data sources were all over the map: Oracle, DB2, Hyperion, JD Edwards, Informix).
So what’s up? It looks like more schizophrenia over in IBM land. The Notes guys are clearly jealous that Duet has gotten all the limelight in the “simplify the interface to SAP” crusade – they admitted that they fast-tracked their Notes-to-SAP strategy last December, which coincides with the first initial release of Duet functionality. In fact, they’re so jealous they want to play the role of spoiler: their Notes interface can run against any existing version of SAP and is “free”, at least according to the red ink on one of their slides. Unlike Duet, which requires that SAP customers upgrade beyond R/3 4.x and requires a license that Microsoft prices around $125.
Of course, IBM’s offering isn’t free either. They’re spinning. Notes customers will pay anywhere from $150 to $399. And the bit about not requiring an SAP upgrade is a case of hitting below the belt, way below the belt. SAP is pushing very hard for these upgrades, and anyone getting in the way, deliberately, is, well, asking for some unwanted attention of the negative kind.
Where will this end? It may never. IBM wants to have it all: a lot of SAP business for its consulting group, some great “let’s get Oracle” co-marketing around DB2, and some smarmy SAP-bashing for its software group. Sounds like old IBM is being tugged in a few too many directions for its own good.
It’s not easy being Blue……