Shifting Focus:

SAP for Mid-size and Small Businesses

CISM 4334FALL 2005Brenda AytesKevin Chua

Jonathan Hill

SAP Roots

• Systems Analysis and Program Development = SAP

• Systems, Applications and Programs in Data Processing

• Company began in 1972 in Mannheim, Germany

• Five former IBM employees started the company

• Corporate offices in Walldorf, Germany

• First module was Financial Accounting R/1

Company Visionaries

Their vision was to develop real-time business processing

• Dietmar Hopp• Hans-Werner Hector• Hasso Plattner- CEO, co-chairman, and co-founder of SAP AG. He has served

as co-chairman since 1997. CEO of SAPMarkets.

• Klaus Tschira• Claus Wellenreuther

Factor

• Former employees

• DB2

• Partnerships

• IBM is a user of SAP

“IBM knows one-size solutions don’t fit all. SAP knows how to cut ERP systems down to size.”

www -1.ibm.com

IBM Express Life Sciences Solution

IBM Express Fabrication and Assembly Solution

IBM Food and Beverage Express Services

IBM i5 Solution Edition for mySAP ERP

IBM OpenPower and DB2 for mySAP All-in-One

IBM Express Services for Inventory Management

IBM Express Supply Chain Solution

IBM Express Wholesale Distribution Solution

SAP Business One 

IBM and SAP solutions for small and medium business

Company Timeline

• 1970’s - SAP is born

• 1980’s – Move corporate headquarters to Walldorf, Germany

• 1990’s – R/3 released on client-server platform mySAP released late 1990’s

Y2K scares the corporate world – SAP a solution

• 2000’s – Internet brings more large corporations to SAP for global workplaces

2002 announced the new Smart Business Solutions for small & medium businesses

What is a small to medium business?

• According to Forbes Magazine-A small to medium business is a business with revenues between $5 million and $750 million and a 5% net profit.

• According to the US Small Business Administration - The definition is any type of business that is not dominate in its field of business. In the manufacturing field the description also designates number of employees to be below 500, while in the service industry small business are defined as businesses that generate less than $5 million in gross revenues.

• According to the market-A small company as any company with less that 1 billion dollars in reported assets, and a medium company as any company with more than 1 billion but less than 10 billion in reported assets.

• According SAP-A small to medium business is a business with revenues between

$5 million and $250 million.

The new market for SAP is small & medium businesses.

Why???

• Largest growth market in the US

• Internet enables small business to occupy a place on the world stage.

• 66 % of all new business in the US are classified as small to medium

• 50 % of all workers in US are employed by small to medium businesses

Why is this market growing?

• Easy to enter

• US government offers incentives to new businesses to enter

• US government continues to research and offer education

• Technology enables easier entry

• More Women & Minority owned businesses

• Federal & state contracts available

Competitors in the Small to Medium Business Market

Seibel – now owned by Oracle

Microsoft

Net Ledger/Oracle

Icode

ACCPAC

SAP moving into the small to medium business marketplace with

full-fledged products – not scaled down versions called:

mySAP All-in-One - targets business with revenues

between $100 million & $250 million

Business One Suite – targets businesses with revenues

between $5 million and $100 million

mySAP All-in-One includes best practices solutions for Every Business Process

with the following products:

mySAP Customer Relationship Management

mySAP ERP

mySAP Product Lifecycle Management

mySAP Supplier Relationship Management

mySAP Supply Chain Management

Individually, mySAP Business Suite solutions help you manage your most critical business processes. Collectively, they form a tightly integrated suite that adds value to every facet of your organization -- and your external value chain.

Businesses large and small have discovered that mySAP Business Suite is the world's most comprehensive family of adaptive business solutions, providing best-of-breed functionality

built for complete integration, industry-specific functionality, unlimited scalability, and easy collaboration over the Internet.

---From the SAP Corporate website

http://www.sap.com

mySAP All-in-One Benefits

• Fast implementation of prepackaged, fixed priced best practices business solutions.

• Expert consultants available to guide you through the entire process quickly.

• Costs are predictable with fast implementation companies realize a 30% time savings and a 40% financial savings to gain a scalable ERP product.

• Automation of critical business processes with tailored out of the box solutions.

Business One Suite

• Based on package by newly acquired company called TopManage

• Partnered with American Express Tax & Business Services to resell

• Not a shrink-wrapped off the shelf software package

• Looking for Quality

• Vertical industries-distribution

• Built from the ground up based on R/3 not a scaled down version

Business One : Features and Functions• Business Administration

• Financial Accounting

• Bank Transactions

• Sales & Distribution

• Purchasing

• Outlook Integration

• Customer Relationship Management• Sales Opportunity management

• Business Partner Management

• Service management

• Manufacturing• Materials Requirement Planning (MRP)

• Warehouse Management

• Reporting

Business One : Benefits

• Gives customer an accurate, up-to-date view of the business

• Instant access to information across finance, manufacturing and sales information.

• Automatic alerts and response capabilities to key business events

• User can tailor their workstation to meet their specific needs.

• Benefits begin immediately due to ease of use and short learning curve.

• Growth capabilities.

mySAP All-in-One Implementations

• Chordus-implemented in their Office Furniture USA division• Hawaiian Tropic-US offices• Creston Electronics-US• Dairy Industries, Jamaica• Southern Pump & Tank, US• Endo Pharmaceuticals, US• Borg Instruments AG, Germany• Oxford Chemicals, Ltd., UK• Wictor, SpA, Italy• PHECOR Ingenieros Consultores, Spain• Hohl & Co, AG, Switzerland

Business One Implementations

Kohler , US , current SAP customer with R/3. Established two manufacturing facilities in Asia and implemented Business One.

Direct Link Worldwide, US

IFCO Systems, US

Trefz GmbH, Germany

Viper Motorcycle, US

Variety Foods, US

Yak Pak, US

Weinman GmbH, Germany

Implementations

• Chordus

• Morgan Foods

• Viper Motorcycles

Chordus

• Chose mySAP because it was the only ERP software package advanced enough to met its business needs

• The R3 module was the first module they implemented and used it to import data form its manufacturers process it and ship it out sameday

• They used SAP to keep a constant metric on its business process allowing for them to stay on the cutting edge ahead of it competition

Chordus

• Chordus with the help of IDS Scheer installed SAP and had it up and running in five months a blazingly fast install.

• Since the implementation of SAP Chordus saw a 17.9% increase in market share a 9.2% increase in on time delivery's while also decrease their damaged products by 16%

• The company is very please with SAP and intends on adding two more modules (CRM,SRM) to it arsenal

Morgan Foods

• Is a mid size food processing company with giant completion like Heinz and Campbell, to stay completive they needed a edge and they found one in SAP.

• The issue that the company was having was it was becoming over ran by supplying to many companies with too many product hurting their efficiency.

• To solve this issue they implemented SAP to increase efficiency and improve productivity

• Within a very short time they received a 125% ROI and a IRR of 64% and a efficiency increase of 54.5% allow them to stay competitive

Viper Motorcycles• Viper motorcycle a custom motorcycle

company that used SAP to replaced a off the shelf accounting software package that it was quickly out growing.

• The luxury motorcycle industry grows about 70% per year and the off the shelf software package could not keep up they needed a package that could connect its manufacturing, accounting, order processing and other business functions together.

• They implemented SAP Business one to suit it rapidly expanding business and to connect and of its business processes.

• Within sixty days the install was complete and up and running produce reports and tracking all aspects of the company allowing them to produce more units more efficiently

Q & A

Q & A