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SAP charges forward with SOA plans

SAP charges forward with SOA plans

SAP is blazing ahead with the next iteration of its NetWeaver technology and its Enterprise Services Architecture (ESA), even as most of its customers trail several technology generations behind the ERP (enterprise resource planning) giant.

ESA was SAP's top focus at its annual meeting in Las Vegas last year with industry analysts, at which SAP mapped out its development priorities and continued evangelizing its take on the SOA (service-oriented architecture) movement. ESA looks to combine SAP's NetWeaver platform with an assortment of enterprise services modeling typical business processes, such as order-to-cash flow or the procedure for adding new customers to a company's CRM (customer relationship management) system. SAP envisions its NetWeaver integration platform evolving from middleware glue for linking heterogeneous systems to a "business process platform" that will underpin a collection of services-based composite applications. The change is aimed at giving customers greater control over how well their enterprise applications automate their organization's particular business processes.

SAP estimates its customer base at around 30,000 organisations running more than 100,000 separate installations. Its tally of NetWeaver deployments still numbers less than 5000, though, and the heavy majority of SAP's customers remain on its legacy R/3 client-server architecture rather than its newer mySAP applications, according to company and analyst estimates.

SAP executives said they anticipated a slow upgrade rate. "God forbid we would have had everybody migrating at the same time," the president of SAP's products and technology group, Shai Agassi, said. "We would have had a disaster on our hands."

Still, SAP's adoption lag means that it's sinking significant development resources into enabling a technology shift customers may not embrace. "It's a big risk SAP is taking," ZapThink analyst, Jason Bloomberg, said. "SAP talks about NetWeaver like it's old technology, but most customers aren't there yet. Until recently, NetWeaver wasn't ready for prime time. R/3 customers are still thinking about NetWeaver."

All of the major applications vendors have adopted SOA strategies, but the promise of "more flexibility, easier integration" is one customers have heard before, Ovum analyst, David Mitchell, said. "SOA is supposed to give you the same flexibility as Java or CICS [Customer Information Control System] before that," he said. "Whether ESA can deliver on SAP's promise to make it easier to change is an open question."

Even as SAP works to break its software down into ever-smaller and more adaptable component chunks, it's confident its bulk will continue attracting customers. "We believe the market is shifting to buying industry-flavored suites," Agassi said. SAP's plan is to work closely with a large network of partners to customise its technology stack for every major industry.

One key advantage SAP has over other applications vendors is its deep expertise about its customers' businesses. As the industry's largest ERP vendor and the software provider for some of the world's most complex corporate ERP systems, SAP has business-process expertise that is unrivalled, Burton Group analyst, Anne Thomas Manes, said.

That knowledge will be useful as customers confront the business-process challenges of moving to an SOA, she predicted. Flexibility is attractive, but shaping IT systems around your business processes requires having a clear map of what those processes are, an often daunting task, Manes commented.

SAP is going full steam in its new architectural direction. In 2006, the company expects to work on another 6000 NetWeaver deployments and to release at least 500 more modeled enterprise services to join the initial 300 it turned loose last year. Its ESA Adoption Program, a methodology for simplifying the ESA transition, has attracted 250 customers so far.


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