SAP Business ByDesign Update

Staying the (Restrained) CourseFellow ZDNet blogger, Dennis Howlett, and I were treated to a briefing by Jeff Stiles of SAP yesterday. The subject was SAP’s Business ByDesign product line.
Written by Brian Sommer, Contributor

Staying the (Restrained) Course

Fellow ZDNet blogger, Dennis Howlett, and I were treated to a briefing by Jeff Stiles of SAP yesterday. The subject was SAP’s Business ByDesign product line. Business ByDesign is SAP’s software as a service (SaaS) or on-demand offering for the SMB marketplace.

Business ByDesign was announced some time ago but SAP has restricted the rollout of the product line while the company works out some multi-tenancy issues and other performance/maintenance matters. Earlier this year, SAP decided to limit the rollout of this product line to six countries. It also decided that it wanted or needed to spend more time with the channel partners who would be implementing these solutions at clients.

Jeff told us that Business ByDesign will continue its limited rollout for 2009. His precise phrasing was “moderated go-to-market in 2009”. He added that the product line “needs to scale to volume”. He also indicated that new Feature Paks are planned. One, which was recently released a couple of months ago, includes new list processing as part of the in-core memory technology that SAP got with the Business Objects acquisition. That technology, T-Rex, will likely show up in more SAP products and in more applications as it provides material improvements in processing and inquiries.

Jeff also indicated that SAP is rolling product development under one person/organization for the first time since 1996. Development will have three groups within it: Large Enterprise (think R/3), SME and Netweaver.

When Dennis and I asked for customer counts on Business ByDesign, Jeff declined to give exact numbers but did indicate it is in the double digits. Jeff re-iterated that SAP is not interested in running up the customer count now but rather it is focused on creating happy, reference-able customers. We also learned that SAP is making progress on the users/blade front with the product now able to support over 100 users/blade.

Given the short time slot, we didn’t get a lot of time to plumb some of the other issues concerning this product line and SAP in general (e.g., the recent decision to raise maintenance rates for users (see think recent piece Dennis did on this subject). We did voice these concerns though:

- SAP may need to do a restart of its marketing efforts regarding Business ByDesign whenever it takes the governor off of its sales. The product line was announced with much fanfare but the slow, cautious rollout has certainly taken some of the pizzazz out of the hype.

- SAP is learning a lot about how tough their highly integrated applications are to update and maintain. Will SAP take the lessons it is learning about maintaining the Business ByDesign product line and start to apply these to other product lines like the Enterprise solutions?

Dennis and I should get more information early next year.

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