Breaking news update (12/08/2010): On December 8, 2010, during his keynote for the SAP Influencer Summit, SAP’s Peter Lorenz, Executive Vice President of SAP’s On-Demand Solutions, announced new SaaS platform names and a clarified vision for SAP’s OnDemand applications. Billed as a “Unified technology stack,” SAP’s OnDemand architecture will be standardized on a Platform as a Service (PaaS) offering that includes “Next Generation Core,” based on the Business ByDesign architecture, and “Next Generation Edge,” a lightweight platform that merges SAP’s lighter weight SaaS technologies including River and Oxygen (Oxygen being the environment in which SAP StreamWork was built).

SAP’s new PaaS also provides a framework for UI enhancements for SAP applications, as well as a connection point to SAP’s Infrastructure-as-a-Service (IaaS), which is where SAP’s much-discussed “in-memory computing engine” that powers HANA fits into the picture. SAP will not rewrite all existing OnDemand apps for this new platform (example: Sourcing OnDemand will remain on “Frictionless”), but you can expect SAP to address platform confusion by ensuring all future OnDemand apps are built on this “unified stack” with “Next Generation Core” or “Edge” technologies. For more details on SAP’s OnDemand strategy and apps, read on…

Confused about SAP’s on-demand application portfolio? Heard about “River” but wondering if its benefits will flow downstream? Curious how Business ByDesign fits into SAP’s large enterprise Line of Business (LOB) offerings? For this edition of Jargon Buster, we’ll ask (and answer) some of the most frequently asked questions about SAP’s LOB SaaS applications.

1. Which functional areas does SAP offer on-demand?

SAP currently features on-demand applications in six areas:

“End-to-end business management” – Business ByDesign

“Sourcing, contracts and supplier management” – Sourcing OnDemand

“Carbon and energy management” – Carbon Impact

“Customer Relationship Management” – CRM OnDemand

“Business Intelligence” – BusinessObjects OnDemand

“Collaborative Decision-Making” – StreamWork

2. Why is there confusion about the platforms SAP is using for on-demand LOB apps?

The confusion stems from the fact that SAP’s on-demand LOB apps were, in most cases, acquired from a range of vendors with different technical platforms. Going forward, look for SAP to standardize on the most technically advanced platforms and add any new on-demand apps to those platforms, as it attempts to minimize platform/app confusion.

3. Which applications run on which platforms?

CRM OnDemand was SAP’s first homegrown on-demand solution, released in 2006. Unlike “pure” SaaS products such at NetSuite, Workday, and (now) Business ByDesign, CRM OnDemand was not built on a multi-tenant platform. It greatest strength is arguably integration with SAP’s on-premise CRM product for easy transition to the deeper functionality of the on-premise offering. Sourcing OnDemand was originally acquired in May 2006 via the Frictionless purchase. When SAP acquired BusinessObjects in October 2007, it also picked up BusinessObjects BI OnDemand, an already established on-demand solution. Xcelsius (Dashboards) and BusinessObjects Explorer are now integrated into the BI OnDemand interface.

In May of 2009, SAP acquired Clear Standards, which became the “River” platform on which Carbon Impact was built. Announced at SAPPHIRE Now 2010, River will support lightweight, cloud-based extensions to SAP’s on-premise and on-demand products. StreamWork is SAP’s latest homegrown on-demand application, focusing on enterprise collaboration. StreamWork recently announced its “Enterprise Edition” and invited online applications for its Enterprise Edition beta program.

4. Why is Business ByDesign relevant to large enterprises?

Even large enterprise SAP ERP customers are keeping an eye on Business ByDesign, for two main reasons:

- ByDesign (ByD), with its main focus on companies from 100-500 employees, is a potentially viable option for subsidiaries of larger SAP customers. Extensions to field and sales offices may be particularly appealing with ByD’s new “starter packs,” geared for 10 users and up, including a starter pack specifically for professional services.

- Now that SAP has conquered the technical issues with ByDesign and delivered a true multi-tenant solution, the technical advances within ByDesign should cross over into SAP’s LOB on-demand offerings and NetWeaver platform. (The latest release of ByD was version 2.5 in August of 2010, which officially moved ByD into the realm of multi-tenant SaaS solutions. Multi-tenancy, the ability to run multiple customers on a single software instance installed on multiple servers, is considered a key to scaling SaaS installations and realizing the economic benefits of SaaS).

5. Has SAP chosen a standard platform going forward?

Originally, SAP’s LOB SaaS group, under the leadership of John Wookey, planned to build its future apps on the Frictionless platform. However, at SAPPHIRE Now 2010, CTO and Executive Board Member Vishal Sikka explained that new LOB apps would be developed using the Business ByDesign architecture. The first such app, Sales OnDemand, is slated for release in early 2011. Complementing the ByD-based LOB solutions, River will also be utilized for lighter apps (lighter meaning a few dozen screens max) such as Carbon Impact, that extend SAP’s core ERP functionality.

6. Which new apps (and releases) are on the way?

In addition to Streamwork Enterprise, other SAP on-demand apps slated for 2011 include:

- Business ByDesign 2.6 – the eagerly awaited “SDK” (ByDesign Studio) release that should facilitate partner development. Target release date: January 2011.

- Sales OnDemand – the first LOB app based on the ByD architecture, Sales OnDemand will draw on ByD’s CRM functionality, StreamWork’s collaborative tools and Sybase mobility tech to create a user-friendly, sales-oriented cockpit for reps on the go.

- Travel OnDemand and a new edition of Sourcing OnDemand are also on the list for 2011 release. SAP HCM-based on-demand is currently offered through partner NorthgateArinso under the name “euHReka OnDemand.” Other SAP LOB apps under development included Career OnDemand (no alpha date has been set for Career OnDemand – customer consultations on product features are still underway).

ERP Executive is published by Panaya.