So we are in the midst of very tight economic times, with 40% budget cuts being expected in Government and survey after survey suggesting IT budgets are at best stable, at worst yet again under slashing attack from nervous CFOs.
But listen to our friends at enterprise apps giant SAP, and, well, as the song says, ‘the future’s so bright I gotta wear shades’. Is there something wrong with this picture?
Sure – at the firm’s ‘SAP World Tour’ roadshow in Birmingham this week, with glitzy presentations from SAP users like F1 leaders Vodafone McLaren Mercedes, the firm’s still relatively new UK and Ireland head Tim Noble, who joined the firm after 15 years at Gartner last year, joined on-stage by his US colleague Sanjay Poonen, executive vice president and general manager of Worldwide Business User and Line of Business Solutions at the firm, terms like ‘economic uncertainty’ were bandied about.
But in discussion with press and analysts later in the day, the tone was resolutely upbeat. Indeed, possibly a tad triumphalist: "We have been growing at double digits rate for the past four quarters in my patch, as fast as we have grown in a long time," Noble told us, adding, "There’s a £2.3bn sized market for enterprise apps in the UK, I can’t see us having any problems continuing to grow, basically."
Those 40% cuts? Bring ’em on, says the firm – it’s opportunity knocks time. "This is a unique time in many ways for us as the kind of business problems a council or a big department is coming to us with now are problems that they know they can’t really solve in any other way. Let’s just say we have a very active sales cycle," he told CBR. Poonen nods in agreement, claiming US public sector bodies are very robust business at the moment, success reflected in commercial pipeline too.
We’re not recording this here in any attempt to make SAP look arrogant. Indeed, SAP ‘Mark Zwei,’ as it were, the firm emerging since the original Walldorf founders stepped back from day to day control last year, is in many ways a much more flexible and friendlier company to do business with from an enterprise point of view – and with its SAP Business ByDesign cloud SME offering the firm has something to say to smaller companies that is more exciting than anything it’s had for years.
But this level of confidence is striking. "Our message to the CIO is that any and all business processes should be outsourced to a package vendor like us," Poonen affirms, encapsulating the firm’s conviction that it is more relevant than ever.
But at the same time – even SAP admits the days of the megaproject may be over. A lot of all that nice pubsec business is "£250k, £500k" quick fix projects with major re-tooling work being left aside for the time being, says Noble.
It knows it has to work on its partner strategy too, as a big consultancy won’t be interested in the SAP Business SME product set (the Business Objects’ portfolio, in essence). The claim, then, is that SAP has emerged from the old R/3 ERP 2 year project that made it so dominant into a world where it’s all about faster, nimbler, less bodyshopping projects – but where its software is still king.
Has it? We’ll see. Signs are good, sure, and at the moment the firm is as shiny as the trim on the McLaren cars that will be built from scratch (as they all are, by the way) for Silverstone this weekend. Will that still be true in a year’s time – or will we all have a new World Champion by then in enterprise software? Chances are, as the song says, studying the apps equivalent of ‘nuclear science’ is probably going to give us the answer SAP wants.
