SAP mode for end-to-end systems

AS heir apparent to the top job at SAP, the world's largest enterprise software company, Leo Apotheker will soon take responsibility for growing revenue that neared $16.8 billion last year.

Apotheker, currently co-chief executive alongside Henning Kagermann, who will retire in a year, will inherit a company that has dramatically changed its enterprise software model.

SAP has switched from providing a highly integrated set of applications to offering a platform aimed at supporting specific business processes in a modular way.

Former database specialist Oracle has also entered this territory with a similar model built on $20 billion worth of acquisitions.

SAP is bedding down its $US6.8 billion acquisition of Business Objects last year and facing a skills shortage at a time when it needs a large talent pool to support its new software model.

SAP has just made the switch from offering highly integrated enterprise applications to this modular system based on business processes. Do users accept that you can support this model?

It goes beyond just a number of business modules. It goes also to a platform.

On our platform you can run various types of software - including non-SAP products. You can create your own - which has interesting support issues in its own right - and you want that the whole environment running for 24 hours, 365 days a year.

We've created a special offering for this kind of support called Enterprise Support, to ensure end-to-end supportability of the entire environment, disregarding what module is being used in a given business process and whether it's a SAP product, a SAP partner product or whatever.

It's pointless to support this module or that module - what you want is end-to-end support, hence the creation of Enterprise Support. We experimented with our large customers in a formula called MaxAttention and all of them are MaxAttention customers. They meet every year as a group to discuss these things.

You've talked about labour shortages. With the modules diversifying so much, can you find the skills to support this software?

That topic concerns all of us. There's huge global competition for good talent.

You can address this challenge in two ways, and only by combining these efforts can you really solve it. You need to have software that is self-healing and intuitive so you need less training.

That includes integrating the various modules in an easy, smooth, non-technical way so you can free up capacity to do something else, and we're doing that. We have shown how you can analyse a business situation, come up with a new business process, do it on the fly without having to involve lots of scarce talent when it comes to programming and developing. Just being a good business analyst is a way to address a labour shortage.

On the other hand, because the shortage goes beyond that, we're working with our key business partners to create programs in schools and universities to attract young people to our profession.

Broadband is particularly important for your Business Network concept. Australia doesn't have a strong reputation for broadband availability. Is that a threat the Business Network message?

It's not just a threat to our offering, it's a threat to the national economy. If broadband isn't available it's creating a competitive disadvantage.

It's like saying, back 50 to 80 years ago, that you don't have a good road, railway or airline system. We live in a digital economy and not having enough broadband capacity is a handicap.

Is that why Australia was left out the launch of SAP's ByDesign software-as-a-service product even though it has a high concentration of small and medium businesses?

That had nothing to do with it. We wanted the ByDesign rollout to focus on some markets with very distinct characteristics. Germany has the greatest variety of mid-market companies. They're the backbone of the German economy. In the French market we wanted to experiment with localisation.

We wanted to go to Britain because Britain also has a very distinct mid-market community. The US is the largest market for anything concerning SAP and it's the most innovative. India is the market for driving things through an ecosystem, so we wanted to experiment with that. And China, well China is China.

China is one of your biggest opportunities to grow revenue but there's pressure on technology companies to observe human rights when dealing with its agencies. What's SAP's position on that?

SAP's policy is to comply with laws and regulations. I'm not giving you the politically correct answer. By the way it's not just China - there are other places that are equally affected by this.

We are fully compliant with the rules and regulations in the US and Western Europe and in China and Russia. We follow those very strict laws.

SAP's code of conduct clearly stipulates things that we will not do, and that moral guideline bleeds into our business relationships and that's how we behave.

Gary Shainburg, one of British Telecom's leading technology executives, says the rise of Facebook and the web is giving credence to open source software development again. Are you concerned about that?

You have to take a very rational view of open source and look at what makes sense in an open source environment.

There are parts of the software stack where it's logical; anywhere you can benefit from the collaborative power of millions of people, and where, if it falls down flat on its face, it doesn't have massive consequences. SAP has a thriving virtual open source community.

There's a 1.5 million-strong community that lives on the internet and does things with SAP - that is a virtual open source community. They do everything around our software except touch the source code. Otherwise they behave and interact just like an open source community.

There are other things that don't make sense in an open source environment. If you talked to a SAP person and asked them if they would use open source around the core network of business process operations they would fall off their chair laughing. If that fell down on its face, who would they call? Who is responsible? Who is liable?

This seemed to be the point Shainburg was making. They were willing to use and support the code themselves.

No, they're not. Not when it comes to the mission-critical part of the network. You don't want a combination of open source and your own software, and part using software on which you simply cannot get the community to collaborate and take responsibility for the software. For example, if a pharmaceuticals company is using the software to run research and development and clinical trials, and something goes wrong somewhere, who is liable? What if there's a flaw in the software?

It seems that increasing functionality is heading inside the web browser. What's the future for the operating system? Will its development be de-emphasised?

The operating system has been de-emphasised for quite some time. The same is true of the database. Among other reasons, the operating system is the web, in a certain sense.

That doesn't mean you don't have to take into account the myriad operating systems. For example, would you consider the core system of the BlackBerry an operating system? I would.

A multitude of platforms are linked by the web, and software should be exploiting all these platforms.