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SAP report card: SAP users not quite ready for mySAP

The results of a survey show that customers are slow to make upgrade plans -- and are taking a wait-and-see approach when it comes to NetWeaver and mySAP ERP.

In the last two years, SAP customers have been encouraged toward Enterprise, introduced to mySAP ERP, informed about NetWeaver -- and issued support deadlines.

All that activity made upgrades a No. 1 priority for SAP shops around the globe.

For anyone not already running mySAP's full-blown business suite, SAP's central upgrade message is this: mySAP ERP is the smart choice because it is powered by NetWeaver. Ignoring NetWeaver puts customers at risk for getting left behind in the quickly changing world of Web services, according to SAP.

So, are all SAP customers taking the company's advice? Not yet, according to a survey of 300 subscribers. The results showed the number of SAP users headed for Enterprise was nearly double the number committed to mySAP ERP.

Sixty-six percent of those SAP shops represented in the survey reported that they were planning an Enterprise upgrade -- a simpler, less expensive upgrade than mySAP ERP -- compared to 34% with mySAP ERP plans.

Even more customers, though, have no upgrade plans. At SAP's annual user show in New Orleans this year, two-thirds of Sapphire attendees reported they had no upgrade plans. In the survey, participants were asked: "When will you upgrade to either mySAP or Enterprise?" Forty percent said they were planning to wait more than a year. Another 24% said they had no current plans to upgrade to either.

"Although SAP has said that mySAP ERP will replace R/3 Enterprise, more than half the users will not have upgraded by 2007," said Gartner Inc. research director Yvonne Genovese. "Customers are having a tough time justifying the business case."

SAP disputes that assessment and points to a 75-city NetWeaver educational tour designed to show developers and decision makers NetWeaver's wow-factors.

"An upgrade to R/3 Enterprise is like talking a train that goes to the last stop," said Shai Agassi, SAP executive board member and the company's NetWeaver evangelist.

Edgar Vasquez, a business system manager for Royal Resorts in Cancun, Mexico, is "starting to look at the new SAP framework," he said. Royal Resorts is running R/34.6C and is starting to upgrade its core product this year. As a mySAP Business Suite customer, Royal Resorts will receive NetWeaver technology with its upgrade.

"I feel confident about NetWeaver," said Vasquez, who attended the recent SAP TechEd '04 San Diego conference. "It's a difficult thing -- an upgrade. But we feel like there is reason to keep building upon our system. When we do, we see the benefits."

In March, when SAP released NetWeaver 2004, the company also announced a new support plan, 5-1-2. Under that plan, mainstream maintenance for all SAP products will stretch five years from the general release date. The plan was a response, the company said, to customers complaining about pressure to upgrade as a result of support deadlines.

Joshua Greenbaum, principal at Enterprise Applications Consulting in Berkeley, Calif., said he has witnessed an increase in shops that are willing to fill their productivity gaps with smaller, non-SAP investments to avoid a full-blown SAP upgrade.

Still, he encourages plenty of customers to choose an upgrade path that includes NetWeaver.

"NetWeaver is a much better platform for supporting most long-term business goals -- like lean manufacturing, greater control over your supply chain -- than the old R/3 system."

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