Business ByDesign: a marketing dive

So what's the skinny on Business ByDesign? A group of bloggers sat down with SAP to shoot the breeze and argue about go to market.
Written by Dennis Howlett, Contributor

My last session of this year's SAPPHIRE was on Business ByDesign. We met once again with Rainer Zinnow and Jeff Stiles who, between them have gotten used too our knockabout style of peppering them with questions. Jon Reed, Anne Petteroe, Vinnie Mirchandani and Michael Krigsman made up the pirate's party.

Rainer got the session off to a good start by saying the company can now host 250 users on a single blade for the full apps suite and soon to reach 500. Anyone remember when this thing was introduced and they were feeling good about hosting 50 users? That was September 2007. Since then SAP has re-engineered a core which was clearly poorly designed and thought through. The competition and naysayers will still give them low marks for execution but I give them credit for sticking with this incredibly difficult project and going to general availability only when they'd ironed out the big problems. As I have suggested elsewhere, it is not all good stuff.

Right now, SAP can offer you any shade of blue for the UI palette. That changes in the next release when the product will become skinable. The UI is sort of OK but SAP readily admits it needs more tweaks.

The SDK will be based on Microsoft Visual Studio which won't please James Governor as the clear implication was that SAP doesn't intend to go the RESTful plus open source route. Or at least that was the impression following Anne's aside to that effect. Unless it has to and even then they're only looking to leverage the relationship they have with Eclipse. Both Rainer and Jeff looked a little sheepish when I said that I fully expect James to go nuts over this decision. "The decision has been made" (aka closed topic.) Oh hang on a minute, James opined on this 6 months ago. In the real world, they need to give their intended developer audience something that commands dollar value. Unfortunately, that implies a cost customers might find indigestible. It also suggests potential mashup limitations. We'll see.

A genuine worry is SAP's declared intention to outsource infrastructure at some point, once they have experience at scale. They didn't seem to grasp that third parties will want profit and that SAP will not be able to dominate the economics discussion in the way it thinks. My bet is this policy will be revised when they understand what's at stake.

BYD leverages in-memory database for analytics. On the basis of what Dr Hasso Plattner, co-founder showed, that could lead to sub second response times. If that nut gets cracked then analytics alone will be a sales lead gen item.

They confirmed the entry level is now 10 users with CRM, general business (ERP) and project management starter packs at yet to be announced pricing. The smart money is on the simpler functionality coming in at around $25/user/month with the more complex offering priced at $65-90/month.

Marketing remains an unknown. Jeff and I had a robust discussion about this because to be frank, I don't think they're looking in the right direction for partners. In similar vein, my colleagues and I had an even more robust contest on this topic. Having more than four years' experience in onboarding SaaS customers, I have a solid feel for what works  - at least in part. I have to give them credit for creating content that prospects find informative. SAP said that by the time customers reach them, they are well informed and SAP has a good sense where they're going and how things might fit. That's a definite step in the right direction.

Jeff was keen to say he is being conservative in his estimates for the market but that should not mean the company will be timid. It will aggressively market. The question is how. My suggestion to SAP? Scrub your marketing brains Brillo pad clean. Marketing for SaaS/cloud is different to anything they have done in the past.

My take? I've always liked the idea of BYD, I've wanted to feel good about the product and I think on those counts they're scoring well...for me. Questions remain around the overall economics and marketing. But - and this is a big difference to previous years - they're listening to their advisers and people like ourselves.

Update: Ray Wang talks to some technical details including the question of suite development. There is another angle on this I should bring out. During the conversation we discussed surround strategies in pre-existing SAP shops given availability (December 2010 likely) of the SDK. The initial response is that SAP would steer customers to All-in-One. I don't see that as viable. Talking later with geeks who are more knowledgeable, the impression I get is that there are some bridging capabilities but this has not been thought through, or if it has, there is no discernible development going on. That's a mistake.

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