Though media blitzes may not be SAP's strongest suit, the Walldorf, Germany-based company does have a market cap of nearly $70 billion and more than 41,000 global customers who are married to its hulking software applications. That some company purchased Paris-based Business Objects, with its 44,000 customers, didn't come as a surprise to industry insiders (Business Objects had reportedly been working with Goldman Sachs to find a suitor, though Business Objects refutes that), but who that buyer ended up being was something of a shock. "What was surprising was the strategy for SAP, because SAP has always been pushing organic growth," says Ray Wang, a principal analyst at Forrester Research.

As everyone in the industry seems to be noting with this deal, "organic growth" will now take place only on farms—and not in the universe of business software vendors. "After years of building a great organic strategy, even mighty SAP realizes that this industry requires strong acquisition skills for survival and growth of partner ecosystems," Wang says. "One may expect other vendors to reconsider their strategies." As such, this deal, combined with Oracle's purchase of Hyperion earlier this year, has made industry watchers and Wall Street speculate that BI vendor Cognos, a chief competitor to Business Objects, will soon be scooped up by either HP or IBM.

According to SAP CEO Henning Kagermann, however, homegrown solutions will still be part of SAP's ongoing strategy. "The acquisition of Business Objects is in keeping with SAP's stated strategy to double our addressable market by 2010 as announced in 2005," said Kagermann in a press release. "SAP will accelerate its growth in the business user segment, while complementing the company's successful organic growth strategy."

Early indications were that Wall Street did not love SAP's purchase. Financial analysts and investors have panned the acquisition, claiming that SAP paid too much. Meanwhile, industry insiders are questioning why SAP ventured so far from its typical game plan. According to The 451 Group, the acquisition is more than 10 times the size of any single deal SAP has inked in its 35-year history.

Perhaps the pressure from Oracle was too much for SAP to take. "One wonders if they bought Business Objects so someone else couldn't buy it," says Dee Slater, CIO of Wolverine Worldwide, the $1.1 billion footwear maker whose portfolio of owned and licensed brands includes Caterpillar, Harley-Davidson, Merrell and Wolverine. Slater's IT shop runs SAP's apparel and footwear, ERP and Virsa compliance calibrator applications. Wolverine is also a former Business Objects customer that switched over to SAP's business information warehouse (BW) tool in 2004.