April 29, 2009

SAP support u-turn represents win-win with users

Will other vendors be forced to offer same level of transparency?

By Mike Simons ComputerWorldUK

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SAP’s decision to delay price rises on the support charges it levies on customers demonstrates the importance of independent user groups, according to Forrester analyst Ray Wang.

The decision to hold back on cost increases until key performance indicators, agreed with SAP’s global user group Sugent, is a major breakthrough he said.

“If successful, this represents a unique and transparent approach to demonstrating value in maintenance,” said Wang.”In the coming weeks, SAP users will want to seek details of the specific KPI’s and determine how those KPI’s will be measured on a consistent basis across different types of organizations.”

Gartner research director Peter Wesche agreed. “SAP’s goal to provide a rating of application support via key performance indicators is innovative and challenging,” he said Peter Wesche. “The extensive benchmarking phase and mapping of key performance indicators to business value will allow customers to fully understand the benefits of a comprehensive support program.”

Both supported the claim by SAP joint CEO Leo Apotheker, who said, “SAP is now the role model for the evolution of software support offering an industry game-changing standard for transparency, accountability and the clear measurement of value. We remain strongly committed to helping our customers both protect their investments and closely manage costs.”

Wang said that agreeing the KPIs and getting valid comparisons across industries and geographies could be difficult. He also said the agreement did not cover the issue of third-party support.

Nevertheless, he said, SAP and Sugen the global coordinating body of uiser groups, had raised the bar with this agreement.

“This will raise question with other vendors and other user groups about the value they get from their support contracts and how those vendors demonstrate value.”

More widely, said Wang, end users are going to have ot start asking, what percentage of their support fees really go back into product improvement and R&D.

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