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SAP 2003: Your Technology and Business Roadmap

Jim ShepherdSenior Vice PresidentAMR Research

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AgendaSAP’s Business StrategySAP’s Product StrategySAP’s Technology DirectionWhat Should You Worry About ?Maximizing The Value of Your SAP

Investment

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SAP Snapshot7.4B € in FY02 Revenues• 56% from Maintenance and Services

FY03 Expectation: Flat Revenue, Improved Profits

19,300 Customers50,000+ Installations – 120+ Countries23 Industry Solutions

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SAP’s Business StrategyAccount Control- “The Reliable Business Partner”Growth – “Influence Greater Share of IT Spending”Customer Lifecycle Management -

“ROI -SAP Delivers ValueServices, Maintenance, & Add-onsNew Markets and Channels

“We don’t want to be just the safe haven– Consider us your trusted innovator”

Henning Kagermann – Sapphire 2003

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CIO Issue

10%

40%

OPERATION

CONSOLIDATION

INNOVATION30%

60%

Today 3 years from now

20-25%

35-40%

Source: SAP AG

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SAP Business Strategy:

InfrastructureConsulting

Infrastr.Software

TechnicalSupport

InfrastructureSupport

Business Software

Business Consulting

System Support

Out-sourcing

System Integration

System Integration

System Integration*

Discover & Evaluate -> Implement -> Operate

HardwareOS, DB, ...

Strategic Consulting

Application Layer

Middleware Layer

IT LayerSource: SAP AG

Become Your “Trusted Partner”

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SAP Business Strategy:

New Maintenance OfferingsArchitecture Planning Custom DevelopmentConsultingSystem IntegrationOperations Planning & OptimizationHosting / Outsourcing

“Extended Range of Services”

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SAP Business Strategy:

Source: SAP AG

SAP Direct Sales

Vertical Resellers

Business One CentersSales/Service Partners

New Markets and Channels

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SAP Product Strategy:

SAP NetWeaver

SAP for <Industry>

SAP Enterprise Portal SAP Master Data Mgmt.

SAP Business Intelligence SAP Exchange Infrastructure

mySAP Business Suite

mySAP ERP mySAP CRM mySAP SCM ...

SAP xApps

SAP xApp Resource & Program Management

SAP xApp Mergers & Acquisitions

...

SAP Smart BusinessSolutions

mySAP All-in-One

SAP Business One

SAP PackagedSolutions

Service Management for <Industry> Financial Insights for <Industry>

...

SAP Mobile Business SAP Web AS

SAP for Aerospace & Defense SAP for Oil & Gas

...

Source: SAP AG

All Things For All Buyers

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SAP Customers Within Fortune 500

source: Fortune 500 2002; SAP Analysis

78%81%

76%

63%37%48%

54%

100%

90%

100%

86%100%

97%

69%

87%87%

57%

86%

0

10

20

30

40

50

60

70

CP

Ret

ail

A&

D

Aut

o

E&C HT

Che

m

Mill

Min

ing

O&

G

Phar

ma

Ban

k

FSP

Ins

Med

ia

Serv

.P

Telc

o

Util

CP/Retail Discrete Process FinancialServices

Services

SAP customer Fortune 500 comp

companies

Source: SAP AG

SAP Vertical Market Penetration:

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Current Application Strategy

The Ever Expanding mySAP Business SuiteR/3 Enterprise or MySAP ERP ?Scalability : All-in-One and Business OneThe xApps (Cross-Applications) Framework

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The Ever Expanding mySap Business Suite

Business Partners World

Inte

rnet

Extr

anet

Enterprise Group

ENTERPRISE

COLLABORATION

Advanced Supply Chain Planning

Customer Relationship Mgmt

Business Warehousing

Intr

anet

R/3 LogisticsR/3 Accounting

R/3 HRR/3 Fulfillment

...

B2B ProcurementStrategic Enterprise ManagementStrategic Enterprise Management

KnowledgeWarehouse

Comprehensive e-Business Solutions

Industry-Add-ons

Portals

Marketplaces

Supply Chain Hubs

Collaborative Engineering

E-Recruiting

Electronic Bill Presentment & Payment

Collaborative Forecasting

Source: SAP AG

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SAP Product Strategy:

mySAP.comHeadquarters

Factory

Distributor

SAP R/3 EnterpriseSAP Business One

Sales Subsidiary

SAP All-in-OneExchange

Infrastructure

Source: SAP AG

Scalability

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SAP Product Strategy:xApps arePackaged Composite Applications.

They deliver newend-to-endbusiness processes,that snap-on to an existingIT environment.

Start out as separate next practices but migrate to suite-based best practices

New, snap on cross-functional business processNew, snap on cross-functional business process

Existing applicationsExisting applicationsand data sourcesand data sources

xAppxApp

Source: SAP AG

xApps

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Source: SAP AG

Functional Transactions (Hindsight)

Bus

ines

s Vi

ews,

Even

ts (C

onte

xt &

Insi

ght)

SCM CRMPLMHR Finan-cials Legacy

Desk-top/

OfficeSupport

SRM

SAP xAppEmployee Productivity

SAP xAppResource and Program Mgmt

SAP xAppProduct Definition

SAP xAppMergers and Acquisitions

Announced xApps

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R/3 Enterprise

SAP Web Application Server 6.20Replaces Basis Server

Provides J2EE and ABAP SupportCommon Foundation for all mySAP.com Components

SAP R/3 EnterpriseExtensionFor SCM

SAP R/3 EnterpriseExtension

For FIN

SAP R/3 EnterpriseExtension

For HR

SAP R/3 EnterpriseExtensionFor Travel

SAP R/3 EnterpriseExtensionFor PLM

SAP R/3 Enterprise Core 4.7All Existing R/3 FunctionalityFuture Changes limited to:

• Legal Changes• Defect Fixes• Performance Enhancements

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R/3 Enterprise Rollout

New “Ramp-up” Release Process~200 Customers in Controlled Release Phase1000’s of Copies Shipped Since JanuaryReports From Customers Are Very Positive

InternalCustomerRelease

RestrictedShipments

UnrestrictedShipments

7/02 12/02

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mySAP SCM

mySAP PLM

mySAP SRM

mySAP CRM

mySAP ERPFinancials

Human ResourcesCorporate Services

Operations

Maintenance & Quality

Inventory & Production

Sale

s O

rder

&

Del

iver

y M

anag

emen

t

Purchase Order

Managem

entSAP NETWEAVER

mySAP Business Suite

Source: SAP AG

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SAP NetWeaver

CorporateServices

OperationsManagement

Human Resources

Financials

Employee RelationshipManagement

Employee LifecycleManagement

Employee TransactionManagement

Purchase OrderManagement

Maintenance& Quality

ProductionManagement

InventoryManagement

Corporate Real Estate

Management

Incentive & CommissionsManagement

Travel Management

Application PlatformProcess IntegrationInformation IntegrationPeople Integration

mySAP ERP

Analytics Financial Analytics Workforce Analytics Operations AnalyticsStrategic EnterpriseManagement

Delivery Management

Sales OrderManagement

FinancialAccounting

Financial Supply Chain Management

ManagementAccounting

Source: SAP AG

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mySAP SCM

mySAP CRM++

mySAP Business Suite Customer can buy and deploy

mySAP Business Suite

+mySAP SCM

mySAP CRM+

R/3 Enter-prise SAP NetWeaver

Quickstep Packages

+

mySAP ERP Customer can buy and deploy mySAP

ERP

Combining mySAP ERP & Solutions Customer can combine mySAP ERP

with mySAP Solutions

Combining R/3E & Parts Customer can combine existing R/3

Installations with Solutions, SAP NetWeaver (also parts of it like e.g. Portal or BI) and with Quickstep packages

SAP NetWeaver

mySAPBusiness Suite

SAP NetWeaver

mySAPERP

SAP NetWeaver

mySAPERP

+++

Quickstep Packages

++

1

2

3

4

SAP Migration Strategy

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Source: SAP AG

New technology foundation of MySAP productsCentralized collection of SAP technologies• Application Servers• UI Management• Integration Framework• Security• Business Process Mgmnt• Data Warehousing• Portal Framework• Etc.

Neutral positioning toward IBM WebSphere and Microsoft .NET

.NET

Web-Sphere

…

DB and OS Abstraction

People Integration

Com

posit

e Ap

plica

tion

Fram

ewor

k

Process IntegrationIntegration

BrokerBusiness Process

Management

Information IntegrationBusiness

IntelligenceKnowledge

Management

Life Cycle Managem

ent

Portal Collaboration

J2EE ABAP

Application Platform

Multi-Channel Access

SAP NetWeaver™SAP NetWeaver™

DB and OS Abstraction

Master Data Management

SAP NetWeaver

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What Should You Be Worrying About ?Instance ConsolidationNew mySAP.com Functionality• PLM, APO, Portals, CRM, etc.

Release Strategy & Expectations• R/3 Enterprise, MySAP ERP, MySAP Business Suite ?

Extended Deployment• Internally• Externally

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Maximizing Your SAP InvestmentCompetency Center -- Business Process

Improvement Not A Help Desk!Continuous Training & EducationEnterprise Performance Management (EPM)Network Theory -- A system becomes more

valuable as it touches more usersAny ERP System Needs Better Public Relations