CHICAGO -- SAP users who are planning to upgrade their R/3 systems to Enterprise should migrate instead to mySAP ERP, according to SAP America CEO Bill McDermott.
In morning remarks made to nearly 350 SAP decision makers gathered at SearchSAP.com's user event Wednesday, McDermott also pledged that SAP would extend current support agreements for as long as a year to customers who committed to an upgrade plan before January.
"I would recommend, quite frankly, that if you are an R/3 customer, that you should bypass Enterprise and go right to mySAP ERP or mySAP Business Suite," McDermott said.
Enterprise is the name SAP last year gave its most recent R/3 technical upgrade before the company introduced mySAP ERP, a new core offering that is a smaller, less expensive version of SAP's full-blown mySAP Business Suite. The mySAP ERP option offers clients full NetWeaver capabilities, and the new strategic platform is at the center of SAP's long-term strategy.
SAP advertises NetWeaver as a comprehensive integration and application platform. Analysts say the new platform pushes SAP into direct competition with typical middleware vendors such as IBM's WebSphere and BEA Systems Inc.'s WebLogic.
McDermott acknowledged that many customers need more information about NetWeaver and its potential impact on SAP's technology stack. It was obvious from the questions McDermott fielded during the hour-long session that many companies are at an upgrade crossroads, unsure of how to progress.
Gartner Inc. research analyst Yvonne Genovese, who preceded McDermott's appearance with a presentation on mySAP ERP, went as far as to say that she believes SAP regrets ever having introduced Enterprise into the SAP vocabulary.
Asked to respond to that, McDermott said that Enterprise, which offered SAP customers new Web application server capabilities, was a sensible choice for some customers one year ago, when it was introduced. Following McDermott's comments, SAP spokesman Bill Wohl, also in attendance at the conference, elaborated on the point.
"I don't think we have any regrets," Wohl said. "With the benefit of hindsight, would it have been smoother for us not to have this interim step, not to have Enterprise? Probably."
However, Wohl said, with so many of SAP's 20,000 clients working on various R/3 versions, Enterprise met the immediate demands many of them had when it was first released.
The importance of NetWeaver throughout the SAP technology stack has been crystallized by SAP in recent months, Wohl said, and the company needs to steer users toward it.
Analysts encourage users to consider mySAP ERP
"I think it's very important for all of you that you get onto that platform," said AMR Research analyst Jim Shepherd, referring to NetWeaver. Shepherd kicked off the SearchSAP.com event with an overview of SAP's product strategy.
SAP clients who are currently running R/3 4.6B or prior versions would "have some work to do before they could just jump to mySAP ERP," Wohl said. Clients running R/3 4.6C and higher are more likely to be able to reach mySAP ERP with less effort. Still, every client should be meeting with SAP representatives and consultants to determine their upgrade path.
All SAP users, Shepherd and Genovese agreed, are going to wind up running mySAP ERP, if not the full business suite, someday.
Genovese warned users, however, that the mySAP ERP option comes with new licensing fees.
The detailed technical sessions changed the landscape for Sargento Foods Inc.'s IT manager Barb Oestreicher, who's based in Wisconsin. Her shop currently runs R/3 4.6C.
"We were going to go to Enterprise in 2005. But we own mySAP," Oestreicher said, echoing many users here who purchased the full business suite when there were plenty of IT budget dollars available, but who have yet to implement it. "We've got to try to figure out what we own. It may be that we can get around Enterprise."
Laurence Wynne is based in Lake Forest, Ill., where he works as a data manger at Pactiv Corp., and is currently considering SAP upgrade options .
"We're trying to find the cost justification for mySAP ERP," Wynne said. Long-term technology investments, he said, don't always show immediate results. "There's a potential risk, or new investment, at the licensing level, and I'm here to find out more about that."
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