SAP is ramping up its midmarket sweep for customers against rivals Oracle and Microsoft, with the launch of new...
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versions of its preconfigured software templates aimed at midsized businesses in nearly 30 specific industries.
Called SAP Best Practices, the preconfigured software includes installation tools, step-by-step implementation methods, documentation and preconfigured settings to reduce installation issues, SAP said in a statement. The software is designed for midsized businesses and is configured to handle company growth, according to SAP.
Aiming at what analysts call "micro-verticals," Oracle Corp. and SAP are trying hard to penetrate the midmarket, which is expected to generate the largest enterprise resource planning revenue for vendors in 2006 and 2007, said Nigel Montgomery, European research director at Boston-based AMR Research Inc.
SAP is relying on partners and independent software vendors (ISVs) to build out and tailor functionality for specific micro-verticals. Oracle launched its Special Edition to tap into the midmarket with a preconfigured product for the general user, while SAP has chosen process scenarios as the basis, Montgomery said.
"SAP is doing so by preconfiguring mySAP, while Oracle is tailoring the E-Business Suite, and it [Oracle] also has the J.D. Edwards product to offer to the upper midmarket," Montgomery said.
The latest SAP Best Practices packages include Warranty Processing with Returnable Parts for the automotive industry and Prototype Development for the high-tech industry. Nearly 30 other industry-specific packages are also being launched.
The SAP software includes scenarios for customer relationship management and supply chain management), such as Campaign Management, Engineer-to-Order and Supply Chain Performance Management. SAP Best Practices for business intelligence and enterprise portal are also included.
Microsoft has momentum.
The midmarket is dominated by firms with smaller budgets that look for lower costs and ease of installation when selecting business software. Microsoft is gaining momentum with Dynamics AX, an ERP suite it purchased from Denmark-based Axapta.
Microsoft recently strengthened its efforts to improve customer support for the applications and partner with ISVs to build out verticals for the software, said Sanjeev Aggarwal, a senior analyst at Boston-based Yankee Group.
Microsoft's strong channel partner network gives it the most clout in the midmarket, Aggarwal said.
"The reach of Microsoft's channel is way beyond any of these other vendors have been able to accomplish," Aggarwal said. "[Microsoft] also has a good customer base. Unless [companies] have a base to start with, it's difficult to grow your market share, especially if that base has a lot of satisfied customers."
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