While SAP made its mark offering core business applications to large enterprises, most SAP customers are considerably smaller. In fact, the majority of our customers fit into the small business and midsize enterprise (SME) market (see sidebar).
Why are SME customers flocking to SAP solutions? Because these solutions are powerful and proven, yet affordable and easy to deploy. The CEOs of many fast-growing SME customers have told me: “We chose SAP solutions because we can count on them to grow our business and to grow with our business.”
Making SAP a Best-Fit for SMEs
Being smaller doesn’t relieve SMEs of demanding business requirements — the FDA does not grant special approvals for smaller firms, nor does Walmart relax its standards for smaller suppliers. The challenge for SMEs is finding powerful software that supports their needs at a fraction of the cost and complexity of full-scale ERP implementations. Over the past several years, SAP has managed to provide just that: “best-fit” solutions that enable our customers to do what they do best — run their business.
The Freedom of Choice
Every SME customer I speak with has unique requirements and challenges. Yet, when it comes to software, none of them have the luxury of deep IT pockets. For this reason, SAP has embraced a fundamentally different portfolio-based approach to the SME market — SME customers, from small start-ups to established midsize businesses, can choose from a full range of software solutions that are designed specifically for their type of business (see Figure 1).
Built-In Templates and Best Practices
What typically drives up the scope of a software project for SMEs is the effort they expend setting up the software, understanding their own processes, and changing the software to match those processes.
Interestingly, this has become a major advantage that SAP offers to SMEs. Having spent the past three decades defining processes for our customers, we have built numerous templates and best practices directly into the software. We’ve also pre-configured the software for customers in different industries. As a result, a typical deployment of SAP’s SME solutions is far less time-consuming than some would guess, often taking a matter of weeks, if not days.
For example, one midsize medical device manufacturer was able to leverage the built-in functionality of SAP Business All-in-One to not only manage the regulatory requirements of the more than 12 countries in which it operates, but to also navigate the challenges of multiple legal entities, languages, and currencies.
Innovative Programs and Tools
Pre-built content alone is not enough — SAP has also introduced innovative tools and programs to help SME customers accelerate their adoption of (and time-to-value for) SAP solutions. For instance, customers can turn to the award-winning SAP Business All-In-One fast-start program, a collaboration between SAP and several hardware partners, to get software and hardware in one pre-integrated, pre-tested package. Just recently, a Canadian start-up company focusing on green manufacturing technologies used this program to get its SAP software up and running in four weeks.
Flexible Pricing and Deployment
Cost is often the biggest question on SME customers’ minds when it comes to buying new software. SAP has addressed this issue by pricing its solutions well within SME customers’ reach — from a few thousand dollars to start with our business intelligence (BI) solutions to US$149 per user per month for SAP Business ByDesign. For a company with 25 users, that’s less than US$50,000 per year — far less than the cost of an IT manager.
Most recently, we introduced new subscription-based pricing for our SAP Business All-in-One fast-start program customers, offering them a flat monthly fee. This allows companies to grow as their needs expand, without enormous up-front payments.
New Options, New Opportunities
What has made SAP the world’s best business software vendor is not its size, but its innovative spirit — today, SAP is leading the charge on the SME front.
On Demand: The New Frontier
The rise of on-demand applications adds a new dimension to adopting business software — these solutions are fast to deploy, easy to maintain, and highly flexible and scalable. With SAP Business ByDesign, a world-class business suite delivered 100% on demand, SAP is at the forefront of on-demand innovation. SME customers can run SAP Business ByDesign without a single IT staff member in-house — precisely the reason why Johnson Products chose the solution after it took over a line of business from Procter & Gamble. They had everything up and running in four weeks, without a glitch.
We also recently introduced SAP BusinessObjects BI OnDemand, a complete and intuitive BI solution based on the software-as-a-service (SaaS) model that allows users to be up and running in a matter of minutes without any prior BI experience.
Connecting Headquarters and Subsidiaries
Even larger enterprises have found SAP’s SME solutions to be a perfect choice for their smaller subsidiaries or affiliates. Instead of implementing a large ERP system at these subsidiaries, big companies use SAP’s SME portfolio of solutions as a cost-effective alternative to connect their smaller solutions to a main business network. One retail services company recently responded to cutthroat competition by franchising its sales model and offering SAP Business One to all of its franchises. As a result, the enterprise can focus on its customers, and the franchises — mostly one-person or two-person shops — can connect to the main business applications via SAP. Right away, the company began to outpace the competition.
Supporting Businesses, Today and Tomorrow
SAP solutions for SMEs enable companies to choose the right solution for them based on fit, budget, and deployment model. These solutions not only meet companies’ current needs, but they can also scale to meet future needs — instead of becoming a bottleneck for growth. Above all, SAP solutions allow SMEs to do what they do best — run their business the way they want to run it.
Senior Vice President
SME, Volume and Ecosystem Marketing