Question: How many months does it take for an ERP vendor to respond to a rival’s major play?
Answer: In the case of SAP, seven months.
That’s what happened today when SAP announced it would buy business intelligence vendor Business Objects for about $6.78 billion.
The SAP announcement came just seven months after Oracle, SAP’s main ERP rival, purchased another major business intelligence vendor Hyperion for more than $3 billion. SAP’s acquisition runs counter to its past statements about growing its customer base “organically,” by developing new features that both keep its customers in the fold and lure others to switch to SAP. But maybe that’s old news at a time when business intelligence is in demand.
Two Ovum analysts, David Bradshaw and Helena Schwenk, noted that Business Objects allows SAP to offer products aimed at “operationalizing the intelligence from business data” that is the bread and butter of ERP systems. The analysts also noted that SAP broadens its appeal to its existing big customers with this acquisition. “Large suppliers are attracting ever larger share of customer spend, as customers try to reduce the number of suppliers to bring some order to their IT buying. In some accounts, the purchase might turn SAP from being an ‘also ran’ into a strategic supplier.” Also noted: Business Objects also offers performance management software (just like SAP does).
So, you’ve read the conventional wisdom about this big enterprise software deal. What do you think? What will this deal mean to enterprise IT departments?