SAP says partners will play a key role in SME strategy 6 May, 2008 By Erin Bell

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Speaking at an SME roundtable during SAPPHIRE, SAP SME President Hans-Peter Klaey said that a multi-channel strategy, with SAP and partners equally engaged to help ensure that SME customers benefit from SAP solutions, was one of the three key pillars of SAP's SME strategy moving forward. (Along with brand extension into the mid-market, and an SME portfolio that provides different levels of depth and functionality based on individual company needs.)

Klaey said that it was important for SAP to see partners as an extension of its sales force in the SME space. "We are very clear what we want to do with partners; we want to have partners of volume and not volume of partners, because we believe if partners can add value to a customer in a specific micro-vertical, then we have the right match and we hit the needs of the market," said Klaey.

SAP gained more than 1,570 new SME customers in the first quarter of 2008, for a total of more than 35,688. Approximately 85 percent of the total number of SME customers is generated through partners alone.

SAP announced that Business All-in-One, its solution for companies up to 2,500 employees, is now available through the fast start program in an all-inclusive offering comprised of hardware, database and operating system. Both HP and IBM have partnered with SAP to offer customers business solutions pre-configured with SAP software.

Specifically addressing the North American market, Glenn Wada, Senior VP of Sap America, said that SAP was not purpose-built to address the middle-market in high-growth enterprises, so the company formed the notion of a "revolution" to change the way it acted and behaved with customers and partners, as well as internally.

In the first quarter of 2008, SAP experienced a 27 percent year-over-year growth in SME North America, with a new customer being added every 1.5 business days.

Wada said that channel performance was continuing to improve.

"When I took over this role there was a clear realization that if we would take all the business anticipated in this market segment and give it to partners, they probably couldn't handle the load. And it's not because they aren't skilled, it's because they haven't scaled," Wada said. "And so what we've done is really invested in a multi-channel strategy that says we're going to put direct field sales resources into place; we're also going to put a sales force in place that has dual responsibility for working on direct deals and indirect deals with our partners."

He also noted a certain amount of resiliency with regards to the economic conditions in the U.S. "We are seeing in this space that these are high-growth organizations that are looking for a business process platform to found their growth."

Wada said that historically SAP had not been very good in the SME space because the company had assumed that its qualifications in the large enterprises would transcend downward, while that was not actually the case.

"What we have come to realize is that SAP has to be much more nimble, pervasive and persistent, and we have to make it easier for customers and prospects to actually find us," said Wada.

One of the ways SAP is doing this is through the Business All-in-One Configurator website, which launched during SAPPHIRE and is currently live. The site allows potential customers to enter information such as industry and number of employees and then suggests a pre-configured solution and price that users could further customize. When finished, the customer could create a summary document that serves as the first step to begin a conversation with SAP or a channel partner.

"[The Configurator] makes SAP all that much more accessible, where traditionally we have been perceived to be less than accessible," said Wada. "I think this is the first major step along with the fast start programs that really start to make it easier for customers to find SAP, and for SAP to build a long-lasting relationship with high-growth companies."