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SAP Business ByDesign Review

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Business ByDesign Fit and Alternatives

Sweet Spot
Business ByDesign is not the first ERP suite to the cloud, but the number of competitors remains small and the market upside opportunity big. Short list Business ByDesign when:

  • You're seeking an enterprise-wide, fully integrated ERP and CRM software as a service solution.
  • You're seeking a broad and integrated horizontal ERP solution. SAP Business ByDesign includes CRM, financial accounting, supply chain management, supplier relationship management, human capital management, compliance and project management.
  • You're looking for a tier 2 CRM or ERP system. SAP is slowly but steadily developing integration between ByDesign and its flagship (on-premise) Business Suite. While other SaaS ERP systems also position themselves as tier 2 options for subsidiaries or remote locations where the SAP Business Suite is an overkill, ByDesign is creating superior integration in the forms of financial consolidation, master data management replication and complete business cycles such as the req to check process.

SAP uses employee count as a yardstick to initially assess product fit for customer markets. While the company indicates ByDesign is targeted at businesses with 100 to 1000 employees, we believe that companies with 50 to 500 employees may more closely align with the limited functionality associated with the product at this early stage.

Alternative Solutions
IT buyers may be best advised to consider alternative CRM products when:

  • Seeking best of breed or CRM-only solutions.
  • Seeking CRM and tightly integrated social CRM capabilities.
  • Seeking vertically focused solutions.
  • Seeking an enterprise-level contact center solution. The current version is more practical as a help desk product than a contact center solution.

SAP Customers
Existing SAP customers are advised to:

  • Consider ByDesign if you're a Business Suite customer seeking a tier 2 ERP or CRM system for regional, line of business or satellite office locations. Determine which integrations exist between Business Suite and ByDesign and discuss SAP's Business Network Integration (BNI) to understand how a tier 2 solution can be implemented.
  • Review ByDesign if you're considering a move from an existing SAP on premise product, presumably Business One or Business All-in-One, to the cloud.
  • Liaise with your SAP representatives to get detailed product roadmaps and pricing announcements so you may understand how ByDesign may affect or deliver new capability to your existing SAP infrastructure.

Concluding Remarks
SAP has introduced an impressive SaaS CRM and ERP solution, however, if the company is to achieve its slated objective of being the number 1 or number 2 player in every market it serves, then it must execute upon three primary activities to accomplish a leadership position in the cloud ERP market. First, SAP cannot become a cloud leader by simply following other leaders. If the company truly wants to achieve a leadership position it will have to show innovation not already demonstrated by much smaller SaaS CRM competitors. Second, the company's nebulous vision for the cloud isn't necessarily holding back market share gains, but the messaging is. The fit, focus and function of ByDesign and the On Demand Line of Business apps remain unclear to many prospects. Lastly, the company must aggressively grow an ISV partner channel and cloud ecosystem, which collectively produce a robust marketplace of vertical, market niche and business process extensions, and deliver a multiplier effect for new customer acquisitions. This is a shift that will require SAP partners to modify or extend their business models from upfront cash flow operations associated with high margin software licensing to annuity revenue streams associated with the cloud—a shift that may require years to absorb and profit from. End

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Comments (12) — Comments for this page are closed —

Guest Steve
  SAP Business One's CRM function is terrible. Any salesperson forced to use it will tell you that it is very cumbersome and unintuitive. Run for the hills, fast as you can, if you are being asked to use SAP Business One for CRM. SAP should stick to what they know and do well, ERP and leave CRM out of their portfolio b/c they are just plain bad at CRM.

Guest Kariappa
  Good Information...about SAP Business By Design..

Guest Jacob Mertz
  Business One On Demand is another cloud CRM/ERP system from SAP. Seems difficult to figure out how this cloud ERP system is different than business by design application.
  Denise Chuck Schaeffer
    SAP unveiled Business One OnDemand (BO-OD) some years ago (at the March 2012 CeBIT conference in Hannover). Prior to this release, Business One was available as a (managed services) hosted product, but not a SaaS solution with a multi-tenant architecture, subscription pricing, etc. Business One OnDemand is targeted to businesses at the smaller end of the SMB range (generally less than 50 users). In a statement, SAP said the software is "suitable for customers seeking to implement their first holistic ERP software as well as for affiliates of large enterprises with deep industry functionality requirements." As with the Business One on-premise product, BO-OD will be sold through a reseller channel. Somewhat interestingly, SAP "encourages" its partners to price the product based on a traditional SaaS subscription pricing model rather than a perpetual software license. Pricing is slated to be €99/user/month however will vary by partner. Also interesting, SAP has lined up a number of telcos as their initial go to market channel partners – a move that has been tried many times in the past and never been successful.

Guest Denis Warfel
  I recognize SAP as an ERP leader, but I also believe the company has been complacent for over two decades. Not since 1979 with the release of R/2 and 1992 with the release of its core R/3 ERP product has the company released any product that achieved a market share leadership position. NetWeaver was an attempt, and is a reasonable product, but not even close to market share leadership. Business ByDesign looks like an attempt, but has been an embarrassment to date in terms of market delivery and early customer acquisitions. Hana looks interesting but I think the hype is more than the reality. The biggest advancements from SAP have come from acquisition; most notably Business Objects and Sybase. Hasso Plattner gave a well cited quote that "Innovating doesn’t go through PowerPoint" – and he's right, but the company has yet to show innovation in nearly two decades. I think the company's culture is so rigid that it doesn't facilitate innovation. I also think the company is in denial.
  Guest Tom Denton
    perfectly said denis
  Guest Saurabh sharma
    Hi Dennis...I am very curious to know about ByDesign.Can you please elaborate your point on that,why you feel like it is an embarrassment to SAP..? Because I have heard that SAP is fighting hard to marketise ByDesign.So is'nt it any hope that ByDesign may achieve leadership position in market share...?
  Guest Denis Warfel
    My comment was that the market delivery and customer adoption of Business ByDesign has been embarrassing; not necessarily the product. When SAP first launched ByDesign in September 2007, then CEO Henning Kagermann said the company would acquire 1000 customers in 2008 and then 10,000 customers per year by 2010. SAP made another projection that it would acquire 100,000 total Business ByDesign customers by 2010. Shortly after these forecasts the product was recalled. In 2011, SAP said it hopes to have acquired 1,000 ByDesign customers by the end of the calendar year. The significant change in expectations and lack of public comment sense suggests to me that SAP believes the product will not take off like other SaaS products in the market have. Having said all that, I think the product itself may be ok, maybe even strong. This website gave it a good review and backed up its points with credible analysis. I don't know for sure, but I suspect the slow go to market is more related to distribution, and possibly the very long lead time necessary to recruit and train business partners to sell and deliver the product.

Guest stevegardner
  The value proposition of cloud CRM and ERP is clear and undeniable. Unfortunately, many companies cant let go of the sunk costs they poured into their legacy systems so upgrading to the cloud will probably occur rather gradually over a long period of time. For companies who aren't shackled by heavily customized on premises CRM and ERP software, or for companies who choose not to throw good money after bad, cloud business systems like SAP Business By Design make a ton of sense.

Guest barry albright
  I saw a sap business by design demo and the software looked pretty good. The CRM software is fully capable, but I don't think they are going after salesforce as much as they are going after netsuite and maybe the microsoft dynamics products. The cloud ERP industry is about to wake up and sap is going to be in a great position to capitalize and continue to show their ERP and CRM leadership. Great review BTW.
  Guest Tom Denton
    agree that the cloud erp market is coming of age, however, disagree that SAP is in position to capitalize

Guest traci sansburg
  I'm glad that after ridiculing the SAAS and cloud trend in the early years SAP finally wised up and is offering what sounds like a competitive solution. It appears to me that SAP is looking for new market opportunities without cannibalizing its on-premise products. I don't think Business ByDesign will threaten Business Suite any time soon, however, it does seem very likely that ByDesign will take big bites out of both Business One and Business All-in-One.

Guest Ahmed Hasama
  F-I-N-I-A-L-L-Y, a software review that gives me the good and the bad. I was referred to this web site and I have bookmarked it. The CRM software reviews clearly stand out and I’m certain will grow tremendously among IT folks looking beyond the pay for say reviews, which are a complete waste of time and insult to our intelligence. Keep up the good work and continue to deliver assessments without vendor bias and this site will go far.






SAP Business ByDesign Review






SAP cannot become a cloud leader by simply following other leaders. If the company truly wants to achieve a leadership position it will have to show innovation not already demonstrated by much smaller SaaS CRM competitors.


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