SAP is struggling to convince some customers that a pricier support service it introduced several years ago provides additional value compared to the standard support option.
“SAP still has a great deal of persuading to do—even though the figures have improved,” said DSAG (German-speaking SAP User Group), in a news release this week. The group, which counts more than 50,000 members in Germany, Austria and Switzerland, surveyed 389 members in April and May.
Some 42 percent of respondents “don’t believe [Enterprise Support] adds very much value, if any,” DSAG said. Another 40 percent declined to answer the question at all.
However, the numbers are an improvement over a similar survey DSAG conducted last year, when almost three-fourths of respondents said Enterprise Support provided little or no added value.
It may be a question of SAP failing to fully educate customers on the extra services Enterprise Support offers, despite its launch of an Enterprise Support Academy aimed at spreading the word, according to DSAG.
Meanwhile, SAP should avoid downplaying the Standard Support option in favor of Enterprise Support and take care to spell out the differences between the two, DSAG said. Customers pay “significant” fees for Standard Support and it should include more than a minimum level of features, the group added.
Maintenance revenues supply software companies such as SAP with a highly profitable revenue stream. But there’s also a general understanding between software vendors and customers that a percentage of maintenance dollars will be used to invest in further development of the software.
To this end, DSAG members surveyed are “rather skeptical” of how SAP is going about this, according to the group. “Criticism is increasing that SAP is mainly investing in innovations, whereas established SAP products such as SAP ERP are hardly being enhanced at all, or only moderately.”
What’s clear from the survey results is that DSAG members are deciding to stick with SAP for support, discontented or not. Just 2 percent said they hire the services of third-party support vendors and only 1 percent reported having no maintenance agreements at all. In addition, SAP has consistently said Enterprise Support has an adoption rate of well over 90 percent of customers.
“SAP is constantly working with our customers and SAP User Groups on further improving its support offerings, e.g. by providing the SAP Enterprise Support Academy program which makes sure that customers have insight and transparency,” a spokesman said in an emailed statement. “This is very well perceived by customers which is also reflected in results of the recent DSAG survey and overwhelming customer retention rates and loyalty with SAP Enterprise Support.”
The enterprise-level service was the subject of major controversy several years ago after SAP announced that all customers would be transitioned over to it. After an outcry from user groups around the world, SAP made some pricing concessions and also restored the Standard Support option.
SAP hiked the cost of Standard Support last year on new contracts from 18 percent to 19 percent of customers’ license cost base. It has committed to freezing the list price of Enterprise Support at 22 percent until 2016.