SAP’s CEO Outlines Services Architecture Strategy

In an opening keynote address before 7,500 customers, partners and consultants at the SAPphire conference in New Orleans, SAP CEO Henning Kagermann outlined the Germany-based software giant's services-centric approach. The core to the strategy is NetWeaver, SAP's integration platform that also enables the development, design and deployment of Web services and composite applications.

"From 2004 on, all SAP applications will be shipped on NetWeaver," Kagermann said. "This is not an option. It's an integral part of our solution. What you will see today and tomorrow is how NetWeaver will evolve into a services platform."

While SAP has differentiated itself from the rest of the software industry by calling its approach an "enterprise services architecture," the company is still conveying the same message: a move to services-oriented architectures. With SOAs, SAP's ERP application could shed its rigid focus on transactional systems and instead deliver exception-based events and business processes that can be easily modified, as well as provide the ability to manage, shift and bring outsourced IT services in-house as the need arises.

"So what is our priority? Where will we start first?" Kagermann said. "The first is supporting business collaboration . . . to improve [users'] flexibility and make them more knowledgeable through services. [Next] is making business processes more flexible to adjust to changing business needs."

SAP said it plans to build an inventory of stand-alone Web services this year, with a NetWeaver services repository slated for delivery next year. In 2006, the company plans to make its Enterprise Services Repository available for active use, which will enable customers to use the repository for building their own services-centric infrastructures. And by 2007, the mySAP ERP offering is scheduled to become fully services-compliant.

Earlier, Kagermann updated attendees on the company's business momentum since the previous SAPphire event. Since the last U.S. conference, SAP gained more market share than ever before in its history and now claims No. 1 status for its CRM, ERP, supply-chain management, supplier relationship management and product life-cycle management applications in those respective markets, he said. The software vendor also added 2,500 new customers and now has 8,000 midmarket customers and serves more than 22,600 customers worldwide.

Turning his attention to SAP's current plans, Kagermann then introduced a video presentation of Microsoft Chairman and Chief Software Architect Bill Gates, who touched on the two companies' alliance to meld SAP and Microsoft cross-platform development (see story).

"Our goal is to help customers protect, integrate and extend their investments," Gates said in the prerecorded video. "Almost two-thirds of new SAP installations are deployed on Windows. The foundation of our work together begins with the retooling of the software industry around Web services. Both Microsoft and SAP are increasing cooperation around advanced Web services protocols, and NetWeaver will support those [protocols] next year."

Kagermann also discussed SAP's efforts toward on-demand or adaptive computing, which would appear to place SAP in the burgeoning autonomic computing market.

"We now announce that we are ending up with the concept of a so-called advanced computing controller, which now moves up to NetWeaver," Kagermann said. "You can match the demands of different applications to the underlying IT resources, independent of which IT resources you have. This allows you to bring total cost of ownership down and explore pay-as-you-go [IT services]. So if you have more demand, you can--on the fly--plug in blades."