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SAP Talks Up Teamwork in Doing Business

June 2, 2007
Related Topics: Human Resources Management Systems (HRMS/HRIS), Corporate Culture, Workforce Planning, Latest News

As SAP battles for a bigger share of companies’ HR software spending, collaboration is its watchword.

During its April user conference in Atlanta, the Germany-based software firm announced that it is developing tools to help workers team up in informal ways, such as with wikis—Web sites where people can discuss a problem. It also claimed that the key to business success these days is better cooperation among customers, suppliers, partners and employees. In keeping with this theme, SAP professes to be committed to working closely with its own customers and partners.

Chief executive Henning Kagermann emphasized this approach in the close of his keynote speech. "Please talk to us," Kagermann said. "Give us feedback."

SAP isn’t alone in promoting collaboration both inside and beyond a company’s walls as a vital business tool. For at least a couple of years, the phrase "extended enterprise" has been in vogue. The growing open-source software movement also has highlighted the promise of widely distributed cooperation.

SAP’s teamwork push comes as it faces challenges. It reported lower-than-expected earnings for the quarter ended March 31. In late March, the company announced the departure of one of its key executives, Shai Agassi, president of SAP’s product and technology group. And while SAP is one of the top sellers of HR software worldwide, it faces stiff competition. That includes archrival Oracle, which recently sued SAP for allegedly stealing Oracle tech support materials.

What’s more, SAP—along with other software companies—has had a reputation for haughtiness. SAP was said to stand for "Shut up And Pay." (The SAP acronym officially comes from the company’s initial name in 1972: Systems, Applications and Products in Data Processing.)

The cynical might say that SAP’s embrace of "co-innovation" is little more than marketing hype to prop up its image. But a number of observers say the firm’s collaboration quest appears to be genuine.

"They certainly have identified the need to be more cooperative," says Christa Degnan Manning, an analyst at AMR Research who studies human resources-related software. Degnan Manning says close communication with customers and partners is especially important in the area of SAP’s human resource software. There’s a limited pool of people who have thought about making HR processes more business-focused, and a still smaller number who have both that "strategic" HR mind-set and familiarity with SAP applications, she says.

Nov Omana, founder of consulting firm Collective HR Solutions, sees a new willingness to listen, both at SAP and at Oracle. Omana points to Oracle’s "Accelerate" program for small and medium-sized firms as an example of the software maker tapping its partners’ expertise.

But can collaboration morph into exploitation? What if software vendors take great ideas from customers without any compensation? Omana, for one, says that’s the wrong way to look at it. The consultant, who is past chairman of the International Association for Human Resource Information Management professional group, says that customers who help vendors improve their software ultimately realize the benefit.

"By you solving this particular problem, the vendor is able to put their development dollars toward other problems," he says.

Ed Frauenheim

Read more about SAP and HR technology.

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