Sapphire 2009: SAP 'changes the game' on support

Leo Apotheker, the CEO of SAP, has challenged rival software suppliers to match it on the support packages they offer to their customers.

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Leo Apotheker, the CEO of SAP has challenged rival software suppliers to match it on the support packages they offer to their customers.

A new support deal SAP agreed last month with its users was “game changing” for the wider enterprise IT industry, Apotheker said.

The enterprise software giant last year provoked a backlash among its own customers when it announced plans to raise the price of its Enterprise Support package from 17% to what Apotheker said was an “industry standard” 22%.

In a significant u-turn , SAP last month agreed to slow down the implantation of the price rises and make them contingent on the software company demonstrating real business value to its customers via a series of key performance indicators.

Speaking ahead of the Sapphire user show, in Oralndo this week, Apotheker said, he believed enterprise support offered unparalleled value to customers.

“We are the only software company on planet that is willing to put on table KPIs that are going to be measured every year by an independent organisation. If they are not met there is financial consequence for (SAP).”

Apotheker said SAP would deliver “30% value generation over four years or we don’t increase prices,” and that he was “willing to challenge other vendors” to match SAP’s commitment.

Apotheker went on to say that cost was not an issue for SAP customers. “It is never about price,” he said, “It is about value,” and SAP “can drive value for our customers, he insisted.

He also hit out at the comments of Mark Benioff, who last week said no business should pay for software support.

“If you run SAP, you can decide not to pay for support,” said Apotheker. “Howver, if run a SAAS solution you have to pay every month, Who is taking in whom?” he asked.

Apotheker did, however, conceded that the backlash against last year’s price rises “Gave us the opportunity to sit back and say why there was such thing as support in first place and, in dialogue, we have redefined the way in which it is done.”

“We had a great debate and we are grateful for the response of our customers, he added.

SAP’s experience with enterprise support and its determination to demonstrate value to its customers in return for price rises, was an example of the wider necessity for businesses transparency, said Apotheker.

A major theme of his pre-Sapphire presentation was that people had lost faith in the economic system, and the only way to recreate confidence was to demonstrate transparency to stakeholders.

As the financial crisis hit the real economy, “People started to have real issue with system, the leadership of system, CEOs and the values companies represent.

“We didn’t prove enough transparency, and that is not just about spinning answers but giving people facts, he said.

Apotheker said that SAP was a “very transparent company” and that it wanted to help other companies become equally transparent.

UK and Ireland SAP User Group Annual Conference 23 and 24 November, Manchester, More details available here

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