Profit from the SAP Ecosystem

Business Models, Partnering, Go-to-Market

Ralf Meyer

• Publisher: Books on Demand
• Year: 2017
• Print ISBN: 9783744881982
• eBook ISBN: 9783744812269
• Edition: 1
• Topic: Business
• Subtopic: Management
• Index: Business

Profit from the SAP Ecosystem: Thanks to over USD 23 billion in sales revenues, 355, 000 customers and 87, 000 employees, SAP is the world's 3rd largest software company. The SAP ecosystem is the largest business software community worldwide, with more than 15, 000 official SAP partner companies, millions of experts and impressive KPIs like: - SAP "touches" more than USD 16 trillion of the world's B2C purchases- 74 percent of the world'stransaction revenues run thru SAP systems- SAP banking customers manage assets worth more than $70 trillion- The SAP Ariba business network runs transactions valued $1, 250b in 2016- Estimated total annual customer spending of USD 309 billion This book is a guide to SAP ecosystem opportunities, challenges and how to successfully manage them. It targets management, sales, business and channel development. It combines startup methodologies with SAP ecosystem best practices, including business model and value proposition design, SAP solution alignment, go-to-market, and much more.The authors of this book are a team of experienced SAP ecosystem experts, who have collectively achieved the following: - Work over 57 years at SAP and for 282 years in the SAP ecosystem- Add 46 partner products to the SAP price list- Complete 65 SAP software certifications- Win 1, 200 SAP enterprise customers directly and 1, 800 via partners- Found the SAP partner association "IA4SP" (www.ia4sp.org)- Support the European Workshop on Software Ecosystems (www.ewseco.org)- Globalize software startups and support M&A- Translate 20, 000, 000 SAP lines into 28 languages

1. Introduction

This book was written with the help of an experienced team of SAP ecosystem experts, including: Ralf Meyer / Thomas Kamper / Dieter Wolf / Gerhard Keller / Franz Baljer / Timo Klemm / Sven Lange / Volker Löhr / Isabella Musso / Nils Niehörster / Andrea Rösinger / Thomas Schmischke / Oliver Schreiber and Ronald Tetteroo.

Figure 1: Co-Authors

1.1 Preface by Peter M. Färbinger

Create confidence, win USP

SAP is a German success story that began in 1975 with five German IBM engineers near Heidelberg. Today, it is a global company with USD 23 billion in sales revenue, 335,000 customers in 180 countries, and 87,000 employees. SAP is also an ecosystem for enterprise software with over 15,000 official SAP partners, tens of thousands of "unofficial" partners, and millions of experts, users, and universities across the world.

SAP’s initial strategy was simple: It enlisted the help of its customers to develop ERP software. Its users brought – and still bring – expertise to the table. SAP is the software developer and vendor. Other software companies supplied the required operating systems, middleware, and databases. Then, a steadily growing number of SAP partners and consultants began handling the Customizing.

This ecosystem of customers and partners together with SAP is most certainly the driving force behind the success of the ERP software. SAP’s success began with building a partner landscape based on fundamental values such as trust, division of labor, and reliability. While SAP developed R/2, R/3, and ERP/ECC 6.0, its partners put together the hardware, supplementary software, operating systems, databases, middleware, Customizing, and training.

Large consulting firms and system integrators played their part in ensuring that everything was put together correctly. SAP’s global success is truly thanks to the work of industry giants such as Accenture, IBM, and HP as well as numerous other partners. And SAP customers received the best solution because every expert added value to the overall picture.

But then the world became increasingly complex: SAP began developing software solutions that went far beyond its core ERP business – NetWeaver as middleware, process integration, Hana as a database, SAP Solution Manager (SolMan) as monitoring and support software, etc.Not only did this cause the SAP portfolio to “explode” and the price list to exceed ℯ pages, many partners suddenly found themselves faced with serious challenges because their supplementary solutions were now considered to be in direct competition with SAP software. The trend toward cloud solutions has only added to the pressure in the ecosystem.

The SAP ecosystem is still in full swing. After all, tens of thousands of software and consulting companies with millions of SAP experts are still reporting revenues in billions each year. However, coasting on this success would be the wrong strategy. Current developments at SAP mean that its partners must adapt their strategies and their portfolios, and find new unique selling propositions (USPs).

You will want to talk to your colleagues in the SAP community and other experts to learn how you can adapt your strategy, your product range, and your USP to the inexorably changing conditions. This is where countless user groups, working groups and congresses, and special interest media (print and online) can help you move forward. The team that put together this book has collected a great deal of information to introduce readers to new methods and best practices to design and implement better business strategies for the changing SAP ecosystem.

Peter M. Färbinger

Editor-in-Chief E-3 Magazin and e3zine.com

Peter M. Färbinger has been Editor-in-Chief of E-3 Magazine, the most widely read, independent information medium for the German-speaking and, more recently, international SAP community (e3zine.com) for 18 years.

1.2 Preface by Ronald Tetteroo

You can profit from the SAP ecosystem!

The SAP ecosystem is a very attractive business opportunity for any enterprise software company. Not just because of the huge number of business customers in the ecosystem, but also because of SAP’s unique approach to partnering.

Unlike many other business software vendors, it is possible here to develop a sustainable business if you define and implement the proper strategy.

Done properly, this will be rewarded by growing revenues from prestigious enterprise customers and help you propel your company to a new professional level and significantly increase overall company valuation.

It is important to understand that partnering with SAP cannot be accomplished casually: It requires excellent preparation and the right strategy. This endeavor is comparable to that of mountaineers who very carefully prepare their trips up mountains that lie 8,000 m above sea level, rather than to tourists relaxing at the beach.

This book describes the basic rules and inner mechanics of the SAP ecosystem in as much detail as is needed. It also provides guidance and advice from experienced experts who have accomplished outstanding results.

Trust me when I say that it is worthwhile to learn the specific secrets of the SAP world and properly leverage the methodologies and tools described to develop and execute a winning SAP ecosystem strategy.

Although we have been an SAP partner for many years, we found that we learned a great deal during our journey through the ecosystem.

In particular, aligning our solutions and company strategy with SAP’s industry-specific business units helped us substantially increase revenues and improve the entire company on all levels including, solutions, management, and quality, ultimately giving a significant boost to the company valuation.

In this respect, I have to thank Gerhard Keller, Ralf Meyer and many SAP experts for guiding me on this very enriching journey.

Dr. Ronald Tetteroo

Advisor, Entrepreneur and Investor

Ronald Tetteroo has been in the IT industry since 1999. He was instrumental in building a showcase for Watchfire at one of the largest pharmaceutical companies in the world, leading to a major acquisition by IBM of Watchfire in July 2007. He also played a crucial role in successfully implementing the SAP ecosystem strategy at StreamServe and in the acquisition by Open Text October 2010.

Dr. Tetteroo, who resides in the United Kingdom, is a passionate musician and cofounder of the Hermes House Band, which has sold more than 16 million records.

www.linkedin.com/in/ronaldtetteroo/

1.3 Acknowledgements

This book describes the opportunities for software companies in the world’s largest business software ecosystem, but also the inevitable challenges and how to manage them to accomplish success in a changing digital world.

The book was written with the help of an experienced team of SAP ecosystem veterans cumulating both broad and deep global expertise.

In total, they worked more than 55 years inside SAP and more than 250 years in the SAP ecosystem.

During this timeframe, they managed to add more than 45 partner products to the SAP pricelist (SAP Solution Extensions) and 60 SAP software certifications. They acquired more than 1,000 SAP direct enterprise customers and won more than 2,000 accounts with help of partners.

The co-authors founded the “International Association for SAP Partners (IA4SP.org)” and the “European Workshop on Software Ecosystems (EWSECO.org),” globalized software startups and supported mergers and acquisitions (M&A).

The book combines up-to-date Silicon Valley startup methodologies such as business model and value proposition design with proven SAP ecosystem best practices including SAP solution alignment and many more.

Target readers are business development managers, SAP alliance managers, founders, investors, partner managers, researcher and salespeople.

Thank you all!

Of course, it was not possible to write this book without the help of many people.

My thanks to the great team of co-authors who supported this endeavor. You are not only part of a great community –you are truly amazing!

I would like to use this opportunity to especially thank Melanie Lutz and Eva Schneider from Wordflow Translation in Walldorf for their great job in proofreading this book. Any remaining bugs are solely my fault and not of the very nice and highly professional SAP-certified language experts in Isabella Musso’s company!

My thanks go to our great clients, startups and partners who have always been a great source of challenges and lessons to learn; and the Synomic team for background support – especially Thomas for his fun & wisdom ;-)

Friends including Jürgen Beckers, Peter Buxmann, Steve Blank, Tim Clark, Daniel Faulk, Howard Lau, Slinger Jansen, Paul Jozefak, Thomas Koulopoulos, Alexander Osterwalder, Antonio Palacin, Detlef Schulz, John Spencer, Jörg Sievert, Günther Tolkmit, Ralph Treitz and many undisclosed SAP “ecosystem heroes” have been my inspiration for many years and have provided valuable guidance for my work in the software ecosystem.

Thank you very much!

Ralf Meyer

Walldorf, September 2017

Ralf Meyer is a software ecosystem and startup “activist”, who worked 15 years at global software players Software AG and SAP and for 15 years supporting international software and cloud companies and startups. He is co-founder of the IA4SP, EWSECO and currently works as a management consultant and interim manager at Synomic and other companies.

www.linkedin.com/in/ralfmeyer

1.4 Why should you read this book

This section contains the background and motivation as to why SAP is a tempting business opportunity for partners, why SAP is a valid option for partnering success, and why you need this book to create a successful partnership with SAP.

1.5 Why SAP?

Section summary

This section illustrates that SAP is truly a proven business success story, a great source of new customers as well as partnering opportunities for enterprise software across all industries and all geographic regions. Today, SAP is more than just a leading ERP software company. SAP has multiple world-class best-of-breed applications like CRM and SCM, numerous cloud solutions, and industry solutions, among others. In addition, SAP offers comprehensive software infrastructure as well as platforms (i.e. SAP HANA and SAP cloud platform) to build enterprise solutions. SAP is also very well known for long-term “stickiness” for both partners and customers, which enables long-term relationships and sustainable business success for the entire SAP ecosystem.

A history of success

SAP has leveraged its position to be a pioneer in standardized business software since the late 1970s. It rapidly grew, serving the demand of large companies to standardize their business operations. Then SAP started to diversify its offering to serve twenty five industries and soon SAP also diversified its offering to fit companies of different sizes from very small with its SAP Business One solutions to very large with its ERP and cloud solutions. At the same time, SAP globalized its business operations and built strong presences in the Americas and Asia and is now having more than 87,000 employees worldwide.

SAP is a long-term growth story of successfully doing business with more than 355,000 customers. Although SAP is doing great in selling products to their customers, there are a lot of untapped business opportunities for SAP. One being feeding, extending and monetizing the ecosystem of partners and customers around SAP. SAP is aware that one important source of current and future growth is their partne...

Table of contents

• Dedication
• Table of Contents
• 1. Introduction
• 2. SAP in the software industry
• 3. The SAP ecosystem and how you profit from it
• 4. Business Models and Design Thinking
• 5. SAP Partnership Models
• 6. Business development and partnering
• 7. Go-to-market in the SAP ecosystem
• 8. Define your SAP Ecosystem Strategy
• 9. Conclusion
• 10. Index
• Copyright