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You can copy off my homework, but just this once 1) They do Enterprise Resources Planning. 2) Because ERP is immensely complicated, and encompasses features t

You can copy off my homework, but just this once 1) They do Enterprise Resources Planning. 2) Because ERP is immensely complicated, and encompasses features that would be useful for almost anyone coordinating any organization, and ERP systems are really hard to change, so they have acquired a user base with lots of zeroes and a thick moat to keep them in.

cm2187 4y ago
Though they have many competitors. A consultant who works on integrating SAP told me once that what gave them a competitive edge is that they let 3rd party consultants integrate SAP while others insist on in house consultants. That means that 3rd party consultant have a clear preference when it is time to advise the client on which system they should pick. That was 20y ago, not sure if it is still the case.
- gryn 4y ago
  still the case today with salesforce doing the same on the CRM side of things. the few consultants that I know that work with these two seems to be paid more than generalist consultants.
- hardware2win 4y ago
  When I worked with smaller ERPs then I've witnessed the same 3rd party were working closely with customers and helped them maintaining the stuff
- taway19920706 4y ago
  Indeed, to SAP the "partner ecosystem" is a big thing. I think they realised early on that if they were to succeed, their success would be driven by consultants with "business expertise" who were recommending SAP as "best of breed". Of course, the reality is that many of those consultants who are being charged to customers at eyewatering rates just finished the training course last week and are now "senior".
- musiciangames 4y ago
  Don't know if it's still the same, but I suspect it will be - another insidious part of the 3rd party consultant relationship is (was) that customers would hire one of the big 5 to help them evaluate and select ERP systems. And that consultancy would also be in a consortium with one of the suppliers (usually SAP), to do the implementation. Isn't that a conflict of interest you would ask? Oh no, the two parts of the consultancy are behind strict Chinese walls, and the evaluation was strictly independent of the bid team. But surprisingly, the vendor they were in bed with always won the contract. As a sales rep with Oracle, I declined to bid on a project. I offered the CFO to write the name of the winning consortium in a sealed envelope, that he could open when the selection was announced.
staticautomatic 4y ago
A guy I interviewed a little while ago observed that SMB SaaS software always tends to become an ERP system on a long enough timeline. It can’t be categorically true but it seemed like a very astute generalization.
numlock86 4y ago
Ah yes, I remember when Lidl tried to integrate SAP in 2015. No one really knows why and after already having spent €500,000,000 in 2016 they pulled the plug and just dropped the project because obviously it wasn't done at that point and they still would have to pay more to finish it. The initial offer never went public but I overheard someone once saying it was like €75,000,000 "only" ... They went back to further develop their own ERP system which is still in use today as far as I know.
- carstenhag 4y ago
  The issue there was that Lidl did not adapt to SAP. They tried to adapt the SAP system to Lidl. Everyone tells you that this is a really bad idea. Everyone.
  - isoprophlex 4y ago
    Yeah you build your business around what SAP allows you to do, or you roll your own. Adapting SAP to existing business is just madness.
    - tut-urut-utut 4y ago
      Only startups that don't have business yet should use SAP ;)
  - roflc0ptic 4y ago
    Clearly there was someone making part of that $500,000,000 that wasn't telling them this.
    - taway19920706 4y ago
      You would think so, but all of the large consulting firms (Accenture, Deloitte, etc) are driven by billing and people wanting to climb the corporate ladder. What the customer needs comes a distant second. Many projects are staffed with 90-95% juniors or people who have no industry knowledge. I've worked alongside consultants from Accenture, Deloitte, IBM, etc over the years and, while many of them are very competent, I would /never/ engage one of those large system integrators (SIs) on any project I was involved in. There are many excellent individuals working for those companies, but the companies themselves are terrible and you will struggle to get any of the excellent people involved during your implementation. The experts will appear during the early stages of the consulting sales cycle but will be nowhere to be seen during the implementation. Unfortunately this is the dirty little secret of SAP implementations. Many SAP customers think "I'll pay top dollar and get a good SI" but they end up getting the latest round of juniors doing the implementation. Seen it many a time.

cm2187 4y ago

Though they have many competitors. A consultant who works on integrating SAP told me once that what gave them a competitive edge is that they let 3rd party consultants integrate SAP while others insist on in house consultants. That means that 3rd party consultant have a clear preference when it is time to advise the client on which system they should pick. That was 20y ago, not sure if it is still the case.

gryn 4y ago
still the case today with salesforce doing the same on the CRM side of things. the few consultants that I know that work with these two seems to be paid more than generalist consultants.
hardware2win 4y ago
When I worked with smaller ERPs then I've witnessed the same 3rd party were working closely with customers and helped them maintaining the stuff
taway19920706 4y ago
Indeed, to SAP the "partner ecosystem" is a big thing. I think they realised early on that if they were to succeed, their success would be driven by consultants with "business expertise" who were recommending SAP as "best of breed". Of course, the reality is that many of those consultants who are being charged to customers at eyewatering rates just finished the training course last week and are now "senior".
musiciangames 4y ago
Don't know if it's still the same, but I suspect it will be - another insidious part of the 3rd party consultant relationship is (was) that customers would hire one of the big 5 to help them evaluate and select ERP systems. And that consultancy would also be in a consortium with one of the suppliers (usually SAP), to do the implementation. Isn't that a conflict of interest you would ask? Oh no, the two parts of the consultancy are behind strict Chinese walls, and the evaluation was strictly independent of the bid team. But surprisingly, the vendor they were in bed with always won the contract. As a sales rep with Oracle, I declined to bid on a project. I offered the CFO to write the name of the winning consortium in a sealed envelope, that he could open when the selection was announced.

staticautomatic 4y ago

A guy I interviewed a little while ago observed that SMB SaaS software always tends to become an ERP system on a long enough timeline. It can’t be categorically true but it seemed like a very astute generalization.

numlock86 4y ago

Ah yes, I remember when Lidl tried to integrate SAP in 2015. No one really knows why and after already having spent €500,000,000 in 2016 they pulled the plug and just dropped the project because obviously it wasn't done at that point and they still would have to pay more to finish it. The initial offer never went public but I overheard someone once saying it was like €75,000,000 "only" ... They went back to further develop their own ERP system which is still in use today as far as I know.

carstenhag 4y ago
The issue there was that Lidl did not adapt to SAP. They tried to adapt the SAP system to Lidl. Everyone tells you that this is a really bad idea. Everyone.
- isoprophlex 4y ago
  Yeah you build your business around what SAP allows you to do, or you roll your own. Adapting SAP to existing business is just madness.
  - tut-urut-utut 4y ago
    Only startups that don't have business yet should use SAP ;)
- roflc0ptic 4y ago
  Clearly there was someone making part of that $500,000,000 that wasn't telling them this.
  - taway19920706 4y ago
    You would think so, but all of the large consulting firms (Accenture, Deloitte, etc) are driven by billing and people wanting to climb the corporate ladder. What the customer needs comes a distant second. Many projects are staffed with 90-95% juniors or people who have no industry knowledge. I've worked alongside consultants from Accenture, Deloitte, IBM, etc over the years and, while many of them are very competent, I would /never/ engage one of those large system integrators (SIs) on any project I was involved in. There are many excellent individuals working for those companies, but the companies themselves are terrible and you will struggle to get any of the excellent people involved during your implementation. The experts will appear during the early stages of the consulting sales cycle but will be nowhere to be seen during the implementation. Unfortunately this is the dirty little secret of SAP implementations. Many SAP customers think "I'll pay top dollar and get a good SI" but they end up getting the latest round of juniors doing the implementation. Seen it many a time.