Resellers key in SAP growth plans

Resellers key in SAP growth plans


The expected listing of SAP's American subsidiary on the New York Stock Exchange this week marks a new era of growth for the company and caps a year-long effort to rewrite the core code for its flagship R/3 package.

And as the enterprise resource planning (ERP) giant is resting much of its growth ambitions on a move into the small and medium business (SMB) market, resellers are set to play a vital role in its plans for the future.

To reach smaller companies, SAP is relying on third-party resellers it groups under the umbrella name of "Team SAP". Though SAP will be forced to miss some revenue by letting resellers get involved in the sales process, company officials concede the approach is key to managing growth.

"One of the biggest lessons we've learned in terms of managing growth is that you have to force yourself to let go," Jeremy Coote, president of SAP America, said. "We're taking what we learned and passing that on to business partners - we lose some revenue that way but it's the only way to manage growth."

SAP is also aiming specially packaged versions of its applications, as well as new standalone applications, to the mid-range market - companies between $US200 million and $US2 billion in revenue.

To do this, SAP, which plans 40 per cent growth in revenue this year, faces the enormous task of polishing up the rewrite of its once-monolithic ERP package using object-oriented techniques.

It is the rewrite of the R/3 package that is allowing the company to split off pieces of the code and offer them as stand-alone analytical applications, and open up the code to third-party applications.

This is a core part of its strategy to expand its market beyond its current installed base of users in the Fortune 500 companies, according to SAP officials.

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