SAP Watch

May 29 2008   10:16AM GMT

Decoding SAP’s strategy rhetoric

JackDanahy Jack Danahy Profile: JackDanahy

At the recently concluded Sapphire Berlin, SAP co-CEOs Henning Kagermann and Léo Apotheker argued that IT-enabled “strategic agility” was the path to competitive differentiation in the current business environment. Kagermann, for example, stated that “true business network collaboration can only be conducted on a services-based IT infrastructure that is flexible and efficient enough to allow companies to adapt their business processes to business needs.”

What’s interesting about this rhetoric is that it is at odds with SAP’s character. Enterprise applications, whether from SAP or other providers, are not agile. They can’t be changed by the customer, since the code is proprietary, and vendors do not tend to make major revisions to the product. If you’re lucky, you get six-month upgrade cycles driven in part by the feedback of your industry peers; if you happen to be in an industry or segment not particularly valued by the vendor, you won’t even be that lucky.

This isn’t a knock against traditional software providers. In fact, perhaps the strength of much of SAP’s product is that, like the businesses it serves, isn’t agile. There are only so many ways to process purchase orders, tie systems together, and orchestrate process flows; there are only so many ways an enterprise can conduct business; and SAP is more vested in finding the canonical way of doing things instead of giving you fifty options. If you want system-wide agility, you need to be able to code changes yourself, and this requires both open source and a very well-trained in-house IT team.

Agility is one of the most abused words in IT and management today, for a number of reasons. Firstly, agility isn’t necessarily good. Becoming competent and staying that way is probably a better guarantee of business success than flitting from model to model in search of success. Secondly, agility may not even be possible. Branding tends to lock you in. Starbucks can’t sell cheap coffee and still be Starbucks, even if selling cheap coffee is the right model. Finally, agility may not require much of a boost from IT. IBM’s 1990s decision to get more heavily into services, one of the few genuine examples of agility over the past two decades, didn’t need IT to succeed.

Demir Barlas, Site Editor

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