New SAP ERP enhancement package highlights a key difference with Oracle

SAP's third enhancement package offers a slew of new industry-specific functionality for SAP ERP users. But how does Oracle's similar offering compare?

The third enhancement package for SAP ERP 6.0 brings to mind one of the differences between enterprise resource planning (ERP) giant SAP and its arch nemesis, Oracle Corp., at least for one IT industry analyst.

Unveiled yesterday, the new enhancement package adds more than 1,400 optional business functions to the latest version of SAP ERP -- functions that customers running SAP's service-oriented architecture (SOA) framework can activate incrementally as needed via "a simple download" instead of having to go through a time-consuming and complex full software upgrade process, according to SAP.

Many of the new features in the enhancement package were designed to meet the needs of specific industries, or industry verticals, including but not limited to the retail, manufacturing and public sectors. That's where the big difference with Oracle can be found, according to Ray Wang, a business applications analyst with Cambridge, Mass.-based Forrester Research Inc.

SAP's enhancement packages can be compared to Oracle's application family packs, which every so often deliver bug fixes and upgrades, but no industry-specific functionality, Wang said.

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"With Oracle's application family packs, it's similar in that you're just sequentially loading things as you need them, whether it's a bug fix or an upgrade. But Oracle doesn't deliver [industry-specific functionality] using the application family pack," Wang said. "What SAP does differently is really adding the industry-specific stuff and adding a series of Web services."

First introduced in mid-2006, SAP's enhancement packages are available to SAP ERP customers free of charge. The packages were designed to reduce some of the top challenges that SAP customers faced whenever it came time to upgrade, Wang said, including all-or-nothing upgrades, business interruptions and high cost.

"The move to enhancement packages allows for targeted upgrades, more frequent upgrades, and less disruption to the business," the analyst explained.

SAP says the enhancement packages are also designed to encourage users to upgrade to SAP ERP 6.0, which offers "flexible" service-enabled capabilities.

New features

According to SAP, more than half of the enterprise services bundles created for the new enhancement package were developed in conjunction with SAP partners and customers.

The latest enhancement package offers updates to core ERP modules, including financials, human capital management, procurement, corporate services, and sales and service.

"With financials, I think customers are going to be … pleased with the stuff that we've done with closing processes -- the financial consolidation effort that companies have to go through every month and quarter and year-end," said Philip Say, SAP's vice president of ERP solution marketing. "We've added a closing cockpit to the software that allows companies to have [greater control] over local closing events within their organizations."

On the industry-specific front, SAP says public sector organizations can take advantage of new functionality that enables grant management, tax and revenue management, tax return processing, shopping cart commitment and item hierarchies.

For retail and trading industries, the enhancement package delivers modules for global data synchronization, merchandise and assortment planning, product lookup in the customer order management process, in-store food production, and cross-docking interfaces to external warehouse management systems, among others.

For manufacturers of consumer products and oil and gas companies, the enhancement package offers improvements to direct store delivery and catch-weight management functionality, as well as improvements to commodity pricing engines in materials management and enhancements to functionality for remote logistics and joint venture accounting.

The package also offers vertical enhancements for users in travel and transportation, aerospace and defense, public security, professional services, and wholesale, according to SAP.

"HR is another huge area that we have improved with the latest enhancement package, and I think the big story here is what we've done with the recruiting engine," Say said. "There have been several major enhancements to the electronic recruiting processes within ERP, and we've improved the manager self-service capabilities."

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