SAP launches R/4 by another name – drives existing ERP extensions

ERP giant SAP has finally conceded that most of the world isn’t going to buy big ticket systems any more – and launched a definitive modular replacement for the existing R/3 v4.6c that needn’t be the all-embracing R/3 Enterprise, or mySAP Business Suite, but instead mySAP ERP with extensions. The announcement, made at last week’s CeBIT exhibition in Hanover, should bring to a close the confusion in the user community over an R/3 upgrade path – and, at last, the reign of the R/3 name. Since SAP’s less than perfect launch of ‘mySAP.com’ three years ago at the height of the e.business furore, users have struggled with SAP’s direction for what had been an expanding scope of R/3. What had been the normal path of evolutionary R/3 releases and versions veered sharply away to a supposed all-Internet architecture, with self-service, role-based interfaces and ‘software components’ apparently including advanced planning and optimisation (APO) and latterly product lifecycle management, (PLM). With the implications for licensing, training, infrastructure – and cost, all that faltered and has since regrouped in various offerings and individual compromises, some facilitated by the user groups, most recently culminating in R/3 Enterprise and mySAP Business Suite. Now we have mySAP ERP, comprising the latest ERP application components (so the core of R/3 Enterprise, including financials and HR, order management, production, maintenance and procurement), along with its recently introduced NetWeaver Web services-based integration framework and Exchange infrastructure with the associated web application server. UK head of technology Martin Tenk explains that it’s essentially the application components in R/3 Enterprise, which superseded R/3 v4.6, but now based on the Netweaver application server. And that’s the significance: mySAP ERP now has three layers – the web application server, the R/3 Enterprise core applications and the ‘Enterprise Extensions’ that from now on will accommodate all new functionality, according to Tenk. mySAP Business Suite therefore becomes mySAP ERP, mySAP CRM, mySAP PLM, mtSAP SCM and so on, underpinned by NetWeaver and its portal infrastructure, which also now includes the business intelligence and its pre-configured business context templates, reports and so on. That means you can add whatever you want whenever you want it – there are no more big leaps; rather the idea is that you should build on your existing investment as and when. Funny that! It also means that the system is prepared for the coming so-called ‘enterprise services architecture’ – the anticipated move to software and functionality provided as Web services. For the few organisations that have already, or are now migrating from R/3 v4.6 to R/3 Enterprise, there is no license cost implication – it’s all part of maintenance. But for users wanting to go straight to mySAP ERP there will be additional licensing charges, although SAP was unwilling to tell me how much. Meanwhile, just to round off the picture, SMEs still have the option of mySAP Business One and All-in-One – the former being the basic PC- and LAN-based accounting-plus system that SAP acquired last year; the latter, the industry pre-configured, manufacturing-centric versions blessed with rapid implementation methodologies and the rest. Tenk emphasises the important point that mySAP ERP absolutely means users have a clear migration path and future coverage, with ‘snap-on’ application functions when you deem you need them and a robust foundation for web collaboration, whatever form that needs to take – internally between departments, sites and group companies, and externally with supply ‘partners’, customers, etc. “mySAP ERP is state-of-the-art ERP,” says Henning Kagermann, now-chairman and CEO of SAP. “mySAP ERP drives down the costs of integration and deployment by shortening time to benefit and leveraging existing IT investments. In addition, mySAP ERP is designed as a deploy-as-you-go package, which enables companies to implement only the business functionality they need when they need it, thus simplifying upgrades and reducing total cost of ownership. “Companies can incorporate enhanced capabilities such as mobile services, business intelligence, and portal collaboration to gain unprecedented control over their extended enterprise resources, IT budgets, and business processes.” Existing SAP R/3 software users (more than 19,000 companies) can add capabilities by upgrading to mySAP ERP, as can the few migrated and migrating SAP R/3 Enterprise users. SAP says more than 200 users begun upgrade projects to the latter from July 2002 to mid-January 2003. Over the last two months, since mass shipment, SAP has received orders and delivered SAP R/3 Enterprise to around 1,500 companies.