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World-Class Business Applications Need World-Class Technology

by Peter Zencke | SAPinsider

April 1, 2003

by Peter Zencke, Member of the Executive Board of SAP AG SAPinsider - 2003 (Volume 4), April (Issue 2)

Q&A with
Peter Zencke, Member of the Executive Board of SAP AG

Q. When mySAP Customer Relationship Management (mySAP CRM) was introduced a few years ago, critics said the offering was too late in coming. Today, mySAP CRM functionality is available as Web services, and it’s about to overtake the #1 spot in the CRM arena. Can the fortifying technology for this solution take some of the credit?

SAP NetWeaver is the fortifying technology that you’re alluding to, and yes, it has played a pivotal role in the rapid market ascent of mySAP CRM. For the competitors overtaken by SAP, it is not completely clear which came first — a stymied vision for their CRM solutions, or limited technology that impeded them from reaching a viable vision. (In some cases I suspect it’s a combination of both.) Competitors have treated CRM as merely a front-office application, with solutions based on proprietary, closed technology. This is self-defeating. After all, how can you declare to have built a customer-focused solution — even one that delivers top-notch user interaction — if you fail to back up those interactions with activities that fulfill the customer’s requests? The information gleaned from those customer interactions needs to be integrated with fulfillment activities and product-planning efforts, and then leveraged to drive operational efficiencies. This is where SAP NetWeaver has been instrumental. We could leverage this powerful integration and application platform to build a world-class application that would reach across all these dimensions.

Q. Open, layered technology stacks are not new, and the capabilities of individual SAP technology elements such as SAP Business Information Warehouse (SAP BW), SAP Web Application Server (SAP Web AS), and SAP Enterprise Portal (SAP EP) are fairly well understood. What is so unique or powerful about the whole of the SAP NetWeaver technology stack?

First, let me explain what SAP NetWeaver is, for those who may still be unfamiliar with it.

SAP delivers a powerful suite that constitutes SAP’s richest array of technologies (see sidebar). Collectively, these elements are known as SAP NetWeaver (see Figure 1).

Figure 1 SAP NetWeaver

Each of these technology offerings and features is powerful in its own right. What makes the collective whole so potent is its ability to lower integration costs:

  • Integration capabilities are key to all SAP NetWeaver components. Enabling IT components to integrate with one another constitutes a huge IT burden. With SAP NetWeaver, the customer no longer has to assume that burden. Integration technologies are pre-built into all the SAP NetWeaver entities listed here. SAP has tackled the challenges of having the portal work with the data warehouse and so forth.

  • Integration is not merely for SAP systems. SAP NetWeaver is fully interoperable and extensible with Microsoft .NET and IBM WebSphere across all layers of the technology stack. It has built-in support for XML, Web services, and business application services. It is a completely open integration platform.

CIOs are all grappling with tight IT budgets. They cannot afford to throw money at one integration effort after another. There needs to be a coherent and comprehensive approach — anything less is too costly and time-consuming. SAP NetWeaver delivers that approach with a reliable, stable, and open integration and application platform. It is unique in its ability to enable organizations to integrate people, information, and business processes across SAP and non-SAP solutions alike. As a unified application platform, it enables you to create new applications targeting cross-functional business processes. The underlying integration platform is already in place. When you minimize complexity, you minimize the total cost of ownership (TCO).

To fully understand what is unique about SAP NetWeaver, you must view it in the context of SAP Enterprise Services Architecture, shown in Figure 2.

Figure 2 SAP Enterprise Services Architecture

SAP Enterprise Services Architecture serves as a blueprint for complete, services-based business solutions. This architecture enables enterprise-scale usage of Web services via customers’ existing technology. SAP NetWeaver provides the necessary technology. By combining SAP’s business process and industry-solution expertise with the openness of Web services and other technology standards, SAP Enterprise Services Architecture provides companies with a template to create fully integrated IT environments built entirely on services-based business solutions that extend across systems and beyond business boundaries. And what’s more, all SAP solutions will use Web services for their internal integration based on SAP Enterprise Services Architecture and are expected to set new standards in usability, scalability, adaptability, and extensibility. All mySAP CRM services, for example, are available as Web services and can be easily integrated into new SAP xApps.

This is a very exciting and groundbreaking step in the development of our applications. mySAP CRM is designed as a service-oriented solution: the people-centric user interface of mySAP CRM, for example, is completely separated from the business-application layer through an additional service layer. This revolutionary architecture will now become mandatory for SAP solutions. The current situation? Most CRM solutions offer a user interface that includes only CRM content. However, the people working in a customer relationship scenario need access to any content — be that CRM, ERP, or SCM. They need this access through all interaction channels, therefore they will need a real portal technology to make it happen. mySAP CRM uses this technology.

Q. What considerations should customers factor into their own designs for “world-class” business applications?
The evolution of our own world-class application, mySAP CRM, offers a nice backdrop for discussing a few of the considerations that could very well factor into applications that readers of SAP Insider might create. It also offers you insights into the need for and merits of an integrated application platform.

To create a world-class CRM application, you must synchronize the dealings by which a company interacts with its customers across all channels: Internet, intranets, mail, phone, fax, mobile, and interaction centers. You must ensure that information flows from one interaction to the next. You have to facilitate knowledge transfer and collaboration among people who interact with customers. Ultimately, you have to ensure that the outcome of those interactions precipitates the appropriate fulfillment activities up and down the length of your supply chain, and across internal processes as well. CRM may start with front-office activities, however, it certainly should not end there — it needs to drive fulfillment activities, it needs to be integrated with your financial systems, it should infuse insights into product life-cycle practices, and so on.

Ambitious business scenarios require the coordination of numerous job functions, activities, and interactions as well as industry specifics. Integration is obviously key, not just in the short-term when you initially establish your solution, but in the long-term, as you maintain and extend your solution. The ease with which you can achieve the necessary degree of integration can make or break an application’s total cost of ownership.

Applications designed to drive profound, not just incremental, gains need to pull from a spectrum of technologies and then integrate processes, information, and people. Integration has to be achieved on all these levels. That is why an integration platform like SAP NetWeaver, where the enabling technologies are designed to interoperate as an integrated whole, is so important.

SAP NetWeaver at a Glance

SAP NetWeaver includes the following:

A new built-in composite application framework — This enables you to create applications targeting cross-functional business processes. All the tools, rules, and methodologies you need are at your disposal.

A new SAP Master Data Management (SAP MDM) component — SAP MDM is the first standardized offering designed to solve the widespread challenges of data integration from multiple systems, physical locations, and diverse vendors. SAP MDM ensures information integrity across the business network by allowing companies to consolidate, harmonize, and centralize master data in heterogeneous IT environments.

Multi-channel access — Web and mobile access to business systems in connected and disconnected scenarios.

Enterprise portal — Internal and external unified user interfaces through a Web browser in a role-based fashion.

Collaboration — Real-time and asynchronous communication among people, in either a moderated or free-form fashion.

Business intelligence — The infrastructure for extracting, aggregating, and analyzing structured business information across the enterprise.

Knowledge management — The unification of multiple sources of unstructured information, such as document management, file services, XML feeds, and so on, for providing and managing knowledge.

An integration broker — A mechanism for internal and external process integration, based on XML messaging.

Business process management — The design, development, execution, monitoring, and management of business processes across the extended enterprise.

J2EE/ABAP — A provisioning of native, highly secured Web services implemented and developed in JAVA or ABAP, and extensibility through Microsoft .NET and IBM WebSphere.

Database and operating-system independence — Open and operable on all relevant platforms.

Life-cycle management — The development, composing and modeling, testing, deployment, and management of the entire software landscape.

What Are SAP xApps?

SAP xApps are composite, cross-functional business processes. Because they run on SAP NetWeaver, SAP xApps can blend transactional, content-driven, or collaborative applications; extract information from a variety of systems; contextualize and analyze that information; facilitate collaborative decision-making; and finally, implement the decision as a series of transactions in connected and integrated systems.

Volkswagen (VW) offers a very good example of such an application that reaches across their entire network of auto dealers in Europe. Based mainly on mySAP CRM, VW eParts is designed to streamline indirect sales and distribution of auto parts via Volkswagen’s authorized dealer network to their end-customers such as non-authorized dealers, independent body shops, and fleet customers. VW eParts also allows end-customers to order parts online via VW’s central Web site at selected dealerships. VW eParts connects multiple VW distribution centers with various dealer management systems at 3,000 dealers across Europe (rollout in progress), and integrates VW’s central illustrated parts catalog. VW eParts provides end-customers easy-to-use and convenient Web access to detailed product, price, and availability information from multiple dealers (checking the dealer management systems directly). It also provides the dealers with online order-management capabilities to fulfill customer orders as well as reorder parts, track the order process, and more. Such complex, collaborative business processes, by their very nature, require an SAP xApps approach.

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