May 12, 2004 3:54 PM PDT
SAP targets defense, radio tags and CRM
SAP, based in Walldorf, Germany, said the defense package focuses primarily on creating faster information processing and secure communications networks for customers. Steve Peck, president of SAP's public services group, recently testified before a congressional committee on terrorism on the need for government agencies to better automate their systems. He said SAP, which employs lobbyists on Capitol Hill to convince legislators to support investments in new software, has solid prospects in the space.
"The government definitely understands that there's a need for these agencies to be more agile and we think that we can help with that a lot," Peck said. "Despite the fact that there is often more demand for services than there is money in the budget, the government is increasingly looking at opportunities around issues such as asset management more like private companies would."
The software maker also announced a contract with the Department of the Interior to automate some of the organization's financial and business management systems. Peck said SAP has designs on a range of emerging public-sector opportunities, including systems modernization efforts in education, the military and state governments.
Another major theme at the annual Sapphire conference was SAP's desire to further establish itself in the retail industry and ride the current wave of attention being given to radio frequency identification (RFID) tools. SAP announced an expansion of a partnership with IBM focused on the retail segment, teaming with Big Blue to offer a package of technology and services meant to help retailers streamline operations, specifically around inventory management technologies.
Long a major figure in the back-office and supply chain operations of manufacturers, distributors and retailers, SAP is one of many companies hoping to become a fixture in the market for RFID, radio tags used to better track inventory. The applications vendor highlighted its work with French airplane manufacturer Airbus, which is using SAP's RFID technology to manage assets.
SAP also made several announcements related to its customer relationship management business. The company rolled out a new partnership with device maker Research In Motion to offer integrated CRM services via that company's BlackBerry handhelds and released a set of business process templates for midsize companies using its software.
The company's push further into the midmarket for CRM moves SAP closer into competition with rival software maker Microsoft, which launched its own CRM business application in the small and midsize customer segment last year. However, Darc Dencker-Rasmussen, vice president of SAP's CRM initiative, said the two companies cater to different customers, with Microsoft squarely in the niche for small-business customers.
"There's some gray area or overlap, but realistically we are selling into much larger organizations than Microsoft is at this point," he said. "We don't usually run into them in the deal-making process."
Dencker-Rasmussen also denied rumors that SAP has aggressively pursued Microsoft channel partners to sell its own CRM software. The executive said that many resellers are carrying both companies' products, adding that he believes there is enough space in the market for the two vendors. However, some resellers have said that Microsoft has become less supportive of their businesses once they picked up the SAP software line.
The applications vendor made a number of other announcements at the conference, including: The release of SAP for Logistics Service Providers, a package of software for supply chain management. An expanded alliance with payroll specialists ADP for business process outsourcing. A deal with meat company Tyson Foods to provide its MySAP business software. A contract with Avanex, a maker of fiber optic gear, for enterprise resource planning and product lifecycle management tools.