SAP Improves Outlook on Performance Management

Another day, another headline. SAP has decided that it needs to retool its financial performance management offering. Why? The reason is the business software giant's announced acquisition of OutlookSoft, which I predicted when Cartesis, the other possible buyer, was taken out of play by itself being acquired by Business Objects. SAP has tried before to update its applications, but this time may be different. OutlookSoft comes with a strong Microsoft-based technology approach and capabilities for budgeting, planning, consolidation, reporting and analysis, all designed for finance departments. If it can harness these, SAP has the potential to be a significant player for financial performance management. In fact, OutlookSoft has not only a good foundation of customers but also a significant head start on Microsoft, which will be releasing the first major version of its technology for performance management at the end of the year.The historical challenge for SAP has been to offer a first-class performance management platform that its customers can implement and use without having to make significant changes to the existing releases of their applications. With OutlookSoft, SAP may now be able to craft a finance offering that will get it onto organizations' short lists more often.

But first, SAP will have to make some tough decisions about its product roadmap. SAP BW has been a foundation component for the Strategic Enterprise Management (SEM) initiative, which overlaps substantially with OutlookSoft's offerings. Whichever apps it chooses to retain and develop further will need to be tweaked to integrate more directly into SAP's R/3 and Financials applications to meet customer expectations for a technology product from SAP.

Then there's the challenge of integrating into this next-generation performance management offering SAP Analytics and SAP BI, which are also on a different technology infrastructure than SAP SEM. There's also the challenge of providing an integrated technology stack that will operate across Finance, Operations and IT. And there's the need to educate SAP's services units and partners to meet a new cycle of demand for implementation and deployment.

Despite these many challenges, organizations using SAP ultimately are likely to find themselves with a much better solution set for financial performance management. With the recent acquisition of Pilot Software, SAP is rapidly catching up to compete effectively against Business Objects, Cognos, Infor and Oracle for the attention of large enterprise CFOs.

Let me know your thoughts.

Mark Smith is CEO And Senior Vice President of Research at Ventana Research. Write to him at [email protected].SAP has decided to retool its financial performance management offering. Why? The reason is the business software giant's announced acquisition of OutlookSoft… OutlookSoft comes with a strong Microsoft-based technology approach and capabilities for budgeting, planning, consolidation, reporting and analysis. If it can harness these, SAP has the potential to be a significant player for financial performance management.