SAP slow to embrace cloud computing, say users

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Almost three quarters (73 per cent) of SAP users believe that SAP had been slow to bring its SaaS suite to market, according to research by the UK & Ireland SAP User Group.

The survey found that 61 per cent of the SAP users saw their organisation using SAP’s SaaS offerings in the future.

Some 16 per cent of respondents said that they ended up using another vendor’s technology in another area of their business because SAP did not have an appropriate SaaS offering for their needs.

Craig Dale, chief executive of the UK & Ireland SAP User Group, said: “Rightly or wrongly, SAP has been criticised for being slow to bring its SaaS offering to the market, but hopefully the result is a more robust and compelling offering. Users potentially stand to benefit from SAP’s hybrid approach whereby organisations have some processes in the cloud, while others are kept within the business. This means that users don’t have to put their business-critical processes in the cloud if they feel it is too risky, but can still reap the cost and flexibility benefits for other areas of their business.”

Currently, only 17 per cent of those surveyed said that they were using SaaS/cloud computing to deliver business-critical applications to their organisation. However, nearly half (49 per cent) said that they planned to use such services in the next 12-18 months, indicating a growing acceptance of this new delivery mechanism for IT.

The research also revealed that over half of the respondents (55 per cent) thought it was more difficult to establish and meet SLAs by keeping all their applications in house, indicating that they actually see the cloud as a better way of meeting their requirements.

Reduced costs (35 per cent) and quicker deployment times (32 per cent) were cited as the biggest benefits for using SaaS/cloud computing by users.

However, when it came to the biggest barriers, opinion was much more evenly split. Compliance/data protection fears (34 per cent) were cited as the biggest barrier, followed by lack of control (26 per cent), lack of customisation (20 per cent) and the risk of network / server outages (20 per cent). This highlights that there still needs to be a lot more education and reassurance when it comes to organisations deploying SaaS/cloud computing services in the future.

“Following SAP’s recent announcement regarding its new Business ByDesign ERP suite, there will no doubt be a lot of renewed interest in software-as-a-service from SAP users. With any technology adoption, it is essential that you look before you leap. Therefore, in the coming months, and at this year’s annual user conference, we will be aiming to further educate our members on the pros and cons of SaaS as different organisations will have different business needs,” added Craig Dale.

Tim Noble, managing director, SAP UK & Ireland, said: “The research findings reinforce the fact that SAP believes in a hybrid model that combines on-premise and on-demand offerings, a mode that allows customers to evolve their businesses and choose which offering fits which business need best. We have been listening closely to our customers’ needs directly and through our relationship with the SAP User Group, and as a result will continue to offer both of these options providing our customers with the choice and flexibility they require.”

Noble continued, “We truly believe we came to the marketplace early enough with SAP Business ByDesign. Innovation is more than just having great ideas and developing nice software. Innovation is only innovation when it is also implemented at the customer and being used productively. This is why we have been working with pilot customers until now to ensure the solution is robust and ready for volume business.”

The UK & Ireland SAP User Conference 2010, which takes place in Manchester on 21-23 November, will include a dedicated stream on SaaS.

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