UK Customers Go Live on SAP Business ByDesign

SAP in the UK announced that a number of mid-sized companies have gone live on SAP's Business ByDesign (BBD) solution. The UK companies highlighted were: Archimedes Pharma (a pan-European pharmaceutical company), Pentagon Chemicals (manufacturer of chemicals), and Red-M (a provider of auditing, integration and consultancy services).

While the uptake of BBD remains small, this will serve as a good reference to help communicate a positive message to the market and help push further business in the UK. SAP has been heavily criticised for the the lack of uptake of its on-demand solution. Moreover SAP's cut in investment for SaaS had led to increased speculation that the on-demand technology was no longer a core strategy and was over hyped in the year of its launch. However, SAP has confirmed that "the development of SAP's Business ByDesign on-demand ERP software is on track and remains a significant part of its long term strategy". They further stated that BBD remains strategic.

So far, on-demand has seen a slow take-up in the ERP space primarily due to most businesses not wanting to give up control of their servers due to security and reliability risks at the expense of reducing some costs. Benefits of cost reductions are obvious from the infrastructure point of view, however ERP implementations can be more costly depending on the complexity and size of an organisation as a result of internal business processes and reliance on custom technology that need to be integrated with ERP software.

However, SaaS suppliers are increasingly seeing the economic downturn as an opportunity to push SaaS solutions as it helps address the challenges related to:
+ large upfront investments associated with the traditional on-premise software
+ valuable resources being consumed by maintaining an in-house infrastructure

Additionally, SaaS offers faster roll out and thus, enables a quicker response to market changes. Nonetheless, while SaaS is seeing some good uptake overall in the UK, there is still a significant number of organisations that are reluctant to adopt the solution. The risks associated with network downtime, the inability to access software and information offline, and a lack of control over data storage are key areas of concern.

Businesses are expected to take a hybrid approach to maintaining SaaS and on-premise software environment and bringing together the benefits offered by both types of solutions. BBD does offer some element of maintaining a hybrid approach, where a user can do everything in the on-demand environment, but is also able to download some desktop tools (e.g. excel) or build mashups that link directly to the online data.

So far BBD has been implemented across 80 customers in China, France, Germany, India, the UK and the US. With SAP's Business ByDesign Feature Pack 2 due later this year, PAC hopes to see some significant improvements and announcements of functionality that will help drive interest in the ERP market.