SAP's new A1S offering, formally called Business ByDesign, is intended for companies between 100-500 employees, which do not have deep vertical market software requirements. SAP believes this $15 billion market will help SAP dramatically expand its business over the coming years.
The product is the result of four years development, involving over 1000 SAP employees. It's intended to help customers simplify their IT operations. Peter Zencke, SAP Executive Board member, said Business ByDesign is not an ERP solution, and is not based on ERP. Rather, it is a single system to help small companies run their business across the following areas:
- Financial management
- People management
The solution extends software integration across the enterprise for small SAP customers, and is not limited to specific departments. SAP believes the single, integrated solution will replace the mix of individual software products that small companies often use to run their business and management infrastructure.
SAP has much is stake, as this solution represents a business model shift as much as a new product. Given the comprehensive nature of this solution, fully understanding its implications, strengths, and weaknesses will require time and careful study.
Without doubt, the product is impressive and represents a major shift in SAP's thinking. In addition, SAP has brought its deep understanding of business processes to the development of of Business ByDesign.
Although Business byDesign is interesting, potential customers should hold off purchasing the system until it is proven over time. However, SAP competitors will certainly begin analyzing Business ByDesign immediately. SAP may have developed a game-changing solution for the on-demand SME market.