Customers trying to use their investments in SAP's Sales and Distribution (SD) module are faced with a dilemma. Even though the SD for e-commerce has a very functional order management technology, this 15-year-old module is difficult to maintain. Customers must decide whether to depend on SAP to build out robust sell-side capabilities or look to best-of-breed.
SAP's lack of a sell-side product strategy has forced users to choose among three paths:
- Deploy best-of-breed today
- Customise incomplete Internet Sales (IS) or Internet Pricing and Configuration (IPC) or wait for SAP CRM 3.0
- Wait for MOE to provide sell-side support
The best-of-breed approach is the clear front-runner strategy; it is the only solution available today. Our research indicates that Comergent, Ironside, HAHT Commerce, and BroadVision are the clear favourites for SAP environments, with a combined customer count of more than 250 companies.
SAP CRM 3.0 and SAPMarket's MOE are incomplete sell-side systems for R/3 customers. Best-of-breed sell-side vendors are becoming increasingly aware that significant revenue opportunities are available when they provide their applications and platforms for CRM 3.0 and MOE users. They should compare the most dominant needs on the sell side with the coverage provided by CRM 3.0 and MOE.
Sell-side vendor Comergent has gained early traction in MarketSite-based environments because of its
IronSide's SAP certification and its win at Brake Brothers give the vendor traction in key with its architecture. In today's order management arena, vertical domain expertise is one of the most effective differentiation strategies.
HAHT Commerce's strong financial performance and growing customer base is attributable to the lack of strong sell-side applications from SAP. Like Ironside, HAHT Commerce has a singularity of vertical market focus that is getting the vendor traction in the chemicals and hi-tech segments. Representative customers include Celanese Chemicals, Infineon Technologies, and Lamson & Sessions. HAHT Commerce is the most established of order management vendors in the SAP arena. SAP's lack of comprehensive, delivered, sell-side strategy allows for HAHT Commerce to gain the most.
BroadVision's recent challenges notwithstanding, this vendor continues to have success selling into SAP-centric environments. BroadVision is another order management vendor that has the potential to play a complementary role to MarketSite Operating Environment users in need of an order management system. Throughout the last two years, BroadVision has steadily worked to gain integration expertise through partnerships and development efforts in order for vendors to work in conjunction with SAP R/3 systems. The vendor has a partnership with SeeBeyond (formerly STC) for its e*Gate technology, which integrates BroadVision's Commerce applications with R/3 environments.
SAP continues to cause confusion with the integration of sell-side functionality into CRM 3.0, which raises licence and upgrade issues. With CRM 3.0, SAP has rewritten nearly all the Internet Sales, Internet Pricing and Configuration (IPC), and Internet Transaction Server (ITS) sell-side functionality in Java. CRM 3.0 is still a long way from leadership, but SAP has improved the story, the technology, and the functionality. It is a very good strategy, perhaps the only strategy, to maintain thousands of customers on old and customised versions of SD.
In conjunction with CRM 3.0, SAP is starting to address multi-enterprise order management (one order management engine is bundled with other CRM components for deployment in order to tie transactions into multiple back-end systems). Today, however, no such application exists. The multi-enterprise order management functionality that SAP is developing has not at this date been targeted for the MarketSite Operating Environment.
The bottom line is that given the requirements of the installed base, SAP has come far but not far enough in comparison with best-of-breed. Further, there is no clear sell-side strategy that ties these pieces together for SAP customers looking to utilize their investment.
For an SAP customer, CRM 3.0 raises a whole series of issues and accompanying recommendations:
- If you are a long-time SD user, you should not have to license CRM to get equivalent functionality. The best-of-breed market dynamics in effect today present SAP with a challenge. If this challenge is met solidly, it could propel the company to stronger successes in the sell side than it has seen to date.
- As a long-term SAP customer, you need to drive the company to include pricing, configuration, and order management in its CRM releases planned for this year and well into the future.
- Expect to see SAP integrate order management, configuration, and pricing within CRM for a single licence fee. There is also the need for making an integration path for R/3 users to connect with and use the functionality delivered in CRM 3.0.
- AMR Research expects to see order management vendors such as Comergent, Ironside, HAHT Commerce, and BroadVision aggressively pursue the MarketSite Operating Environment as a growth platform. Their pursuit will come as a result of SAP's lack of order management functionality.
Ironically, despite a wealth of functionality, SAP continues to suffer from a lack of direction. Although sell-side order management vendors are anticipating SAP's acquisition and subsequent aggressive move into the sell side, they are starting to favour partnerships with Commerce One. The window of opportunity for SAP will close fast as Commerce One gets sell-side vendors to support xCBL as a standard.