SaaS computing - new business/financial systems

In yesterday’s news update, I mentioned that there have been announcements this last week by three major players about their new cloud and on-premise offerings:

(1) SAP Business ByDesign (BYD)
(2) IRIS OpenApps
(3) Sage ERP 1000 v3.0 (1000 and Line 500)

Let's focus in this article on SAP Business ByDesign.

SAP Business ByDesign (BYD)

SAP Business ByDesign (BYD) was originally launched as a SaaS cloud service in 2007. It is understood that take-up was not as fast as SAP had hoped. BYD has just been upgraded and re-launched. As a SaaS service, the application and data is hosted by SAP. Commercially, payment is typically made periodically.

BYD is aimed at organisations of around 100-500 employees, and priced for 10 system users upwards (formerly minimum 25 users). BYD provides a range of functionality across financial management, CRM and business operations. (Stop press: Within minutes of me posting this article, the diagram in the original linked page has now been removed by SAP. Spooky!).

A lot is being written elsewhere about BYD as a product, and the pros and cons of SaaS. What users may find useful is to put BYD into context of SAP and its other offerings.

Until relatively recently, SAP focused exclusively on “tier 1” corporates for their financial and ERP (manufacturing) software. Their main product was R/3, which is now part of the “Business Suite” for corporates. But SAP had an issue. Groups of companies found it significantly more expensive to deploy a separate SAP system in their subs, rather than to use non-SAP products. One centralised group system was often not ideal. In addition, SAP had the opportunity to widen their business into the sub-corporate market.

However it is only in the last few years that SAP has operated in the mid-market. This was by acquiring a mid-market ERP system now called Business One, and at the upper end providing a cut-down version of R/3 now known as All-in-One. The new BYD sits alongside and between these two offerings, being a separate product using technology to suit the SaaS model.

SAP (and Oracle) talks about the SME sector and “small” companies. However they do not compete with the likes of Sage Line 50. It’s best to think of their SME offerings as being for the lower and upper mid-market, with indicative user numbers as:

• 500+ users: SAP Business All-in-One
• 10 to 500 users: SAP Business ByDesign
• 10-100 users: SAP Business One

With SAP coming from the “confusion wins the sale” school of marketing, SAP Business BOGOF (Buy-One-Get-One-Free) is due for launch in July. No seriously, given how different “Business All-in-One” is to “Business One”, it helps not to be confused!

Further detail on the SAP products and their history is below, if you are interested (or want a snooze!)

Outline SAP History

In broad terms the relevant history of SAP is as follows (please comment if anything should be added or amended!) :

• Founded 1972 as an IBM spin-out, with their R/1 software developed for ICI as a manufacturing-focused “Enterprise Resource Planning” (ERP) system
• Originally called "Systemanalyse und Programmentwicklung" ("System Analysis and Program Development") and re-named "Systems, Applications and Products in Data Processing"
• R/2 was launched 1979
• R/3 was launched 1992 as a 3-tier “thin” client-server system (database, application server and client, where processing and business logic is carried out by the centralised application server).
• R/3 has morphed into the “ECC” component of the “ERP” system within today’s corporate “Business Suite”

• Entered internet world in 1999 with MySAP.com which provided ecommerce functionality for R/3
• MySAP became the name for a simplified version of R/3.
• MySAP has since morphed into SAP “Business All-in-One” (all in one database)

• SAP Business One was SAP’s first real foray into the mid-market.
  
• Based on the acquisition of TopManage Financial Systems in 2002
• This is a 2-tier "thick" client-server system (where all processing and business logic are carried out on the client PC instead of the application server)

• SAP Business ByDesign (BYD) was first launched in late 2007, one tenant per physical server
  
• Re-launched May 2010 as multi-tenant system (multiple tenants per physical server, but some form of separation of those tenants, awaiting clarification), available August