SAP is eyeing to capture a bigger share of the Indian market in its fight to gain a stronger foothold against its competitors.
“India is key for SAP’s expanding global business as the country is an integral part of the company’s emerging market growth. We want to have a dominant presence in both the Fortune 2,000 and Fortune 2,00,000 company categories in the country and have set an ambitious target of having a 150,000-strong customer base in the next four years,” said Alan Sedghi, President & CEO, SAP Indian Subcontinent, while interacting with media at a “media offsite” workshop held recently in Bangalore.
Mr. Sedghi foresees a great future for Waldorf, Germany-based SAP in India. Dubbing India as one of its most important markets, he said, “SAP powers some of India’s most successful and well-known organizations, including a growing number of small- and mid-sized companies.”
SAP has been involved with the Indian market for a decade and already runs business offices in Delhi, Mumbai, Bangalore and Kolkata.
2006 was the best year ever for SAP India and its success was a fitting tribute to the completion of a decade of its operations in India. A clear and consistent product roadmap, long-term customers’ commitment and unique engagement models have paid rich dividends to us. It is heartening to note that SAP India has successfully met the twin challenge of managing rapid customer growth and increasing customer satisfaction,” said Mr. Sedghi. The message Mr. Sedghi has sent out is clear. India, which has become crucible of IT market and opportunities, occupies a place of prominence in the SAP’s scheme of things.
Last year, SAP had committed to invest about $1 billion in India over the next five years. About $38.4 million of the capital will be used to boost its research and development presence in the country. The company expects to double its headcount from the current 3,500 to 7,000 by 2010.
Meanwhile, India’s small- and mid-sized enterprises are showing a propensity to invest in automation and enterprise softwares. The SME segment was unable to afford the SAP’s systems earlier because of the expensiveness of the solutions. However, the company had some timely innovation of solutions for the SMEs, including SAP Business-One and mySAP All-in-One, which enabled SAP to address the burgeoning segment. The company had also some pricing policy for the SMEs, which had also helped the company to expand its market in the SMEs. Deb Deep Sengupta, Vice-President, SME, SAP India, says, “The SME segment is a key focus segment for SAP in India and we would work with partner network to drive our SME strategy in India.”
In fact, the SME segment is growing at the rate of 12 per cent CARG in India and is expected to increase from 27 per cent to 30 per cent by 2010.
SAP India has consolidated its market leadership, especially in the SME segment in India and extended its leadership to new verticals and market segments as well.
As the Indian retail segment is heating up, the IT vendors can ill-afford to lose sight of this sector. Taking a step in the direction, SAP India has recently opened a SAP Centre of Excellence (CoE) for Retail. The SAP Retail CoE functions out of the company’s Mumbai facility. SAP also plans to recruit 160 developers and value engineers in India exclusively for the retail space during the current calendar year. Presently, the company has 15 developers and value engineers who are working in the retail space.
“In the retail space, India will achieve in the next five years what others have taken 25 years to achieve,” said Colin Lian, Director Retail BD, SAP APAC.
On its part, SAP was focussed on “driving global, regional and local retail”. According to Mr. Lian, “Retail is the company’s fastest-growing and soon-to-be largest industry vertical.” Among the industry verticals, retail currently ranks No. 5 in terms of contribution to the company’s overall revenue. This ranking is expected to move up the ladder to No. 3 by 2010, thanks to SAP’s special focus on the mid-market segment.
The key Indian retailers like Reliance, Pantaloons, RPG (Spencers), Trent, Hariyali Kissan Bazaar, Godrej, ITC-IBD, Barista and Vishal Megamart are some of the SAP customers in the Indian retail space.
Mr. Lian said, “SAP’s dominance in the mid-market segment would be propelled by fast and easy implementation of mySAP business suite, shortened implementation time, reduced costs of ownership and quick returns on investments.” In India, SAP has about 1,400 customers. SAP India accounts for about 3 per cent of SAP Global’s customer base.”“By 2010, SAP Global has set a target of reaching 1.5 lakh customers. So, a 15,000 figure will mean that India will account for 10 per cent of the total customer base for the company,” said Mr. Sedghi.
The year 2006 saw many Indian enterprises demonstrating thought leadership in choosing to implement enterprise software solutions in new verticals”– in some cases for the very first time in the industry.
Some of the key wins for SAP under its belt include Fortis Healthcare, one of the largest healthcare groups in India, IndiaBulls, India’s leading financial services and securities companies, and the Park Hotel, among others.
SAP also witnessed Indian enterprises adopting new solutions available, including CRM on Demand, DUET, Master Data management (MDM) and GRC (Government and Risk Compliance). SAP and Microsoft are about to launch Duet is the jointly developed software by SPA and Microsoft to link their respective enterprise and desktop programs. Duet makes it easier to access SAP applications through Microsoft Office.
SAP introduced a GRC suite last year after acquiring compliance specialist Virsa in April. The company has created a new governance, risk and compliance (GRC) business unit that would develop new technology to help organizations to meet a growing list of requirements, such as the Government regulations for different sectors.
Zydus Cadila (CRM on Demand), Saptha and Mawana Sugars (DUET), Reliance Communication (MDM) and Lanco Global, Orchid Pharma and Wipro (GRC) are some of the Indian enterprises which chose SAP’s new solutions.
SAP - Leadership in the Indian Market
SAP’s solutions empower over 1,348 Indian enterprises (at December-end 2006) from across large-, mid- and small-sized enterprises with the benefits of world-class enterprise software solutions to accelerate growth through innovation. SAP’s Indian customer base features over 883 SME customers. In early 2006, SAP had become the first enterprise software solutions vendor to cross the 1,000-customer mark in India.
Signifying the continued momentum, SAP India has signed on 498 new customers in 2006. These customers range across key industry segments, including Consumer Products, Retail, BFSI, Professional Services, Textiles and Pharmaceuticals, demonstrating SAP’s broad- based growth in the country.
The key customer wins for SAP in 2006 include Kingfisher Airlines (one of India’s fast-growing airlines), NTPC (India’s largest Power Generator and one of the world’s biggest), State of Bank of India (India’s No. 1 Bank and having possibly the largest number of branches globally), and HCC (India’s No. 1 construction company), among others.
In 2006, over 20 Indian enterprises moved on to SAP solutions from various other solutions. Enterprises like Havells, Umrin Products, Camlin, Shriram Pistons & Rings, among others, decided to migrate to SAP solutions from their existing software solutions.
SAP - Building on Its leadership in the SME Segment 2006 also witnessed SAP further consolidating its leadership and reach in the Indian SME segment.
SAP All-in-One – SAP’s complete business solution specifically built for mid-sized companies to address the business software requirements of the most demanding mid-sized organizations–– saw increased customer traction with over 170 new wins for the solution. Delivered to customers through SAP’s All-in-One partners, this success also reflects the strength and maturity of SAP’s All-in-One partner ecosystem in India. The key Customers for SAP All-in-One include Total Environment, Interglobe Aviation, Donear Suitings, Add Corporation, Raymonds and ABAN Power, among others.
SAP Business One, specifically built for the Indian small enterprise segment launched in India in early 2006 – saw outstanding market acceptance with over 263 new wins. The key customers for SAP Business One include Pidilite Industries, Saint-Gobain Weber, TCL, Sony, World, Edwards Lifesciences and Stanvac Chemicals, among others.
To ensure that the Indian small enterprises spread across the length and breadth of the country have access to world-class business software solutions, SAP has built a strong partner network – with over 75 resellers and three national distributors.
Today, the SAP partner ecosystem in India includes 38 ISV partners, offering over 54 “Powered by SAP NetWeaver” solutions, 20 SAP All-in-One partners offering over 20 micro-vertical solutions based on SAP All-in-One, 22 service partners and three SAP Business One distributors and 75 SAP Business One resellers.
Building on the strong base of customers and partners, SAP aims to enhance its broad-based growth in India.
“In 2007 specifically and going forward, we aim to consolidate our leadership in the SME segment, consolidate our strength in key and emerging verticals and promote our Enterprise SOA platform,” said Alan Sedghi on the plans for 2007.
Finally…
For its success ratio, SAP India has received many accolades, including VARIndia Star Nite Awards as the Best ERP Solution Provider for 2006 and gaining top slot in the Annual Customer Satisfaction Audit (CSA) 2007 for enterprise applications. The CIOs are found choosing SAP ahead of Oracle, Microsoft Business Solutions and RAMCO as the top enterprise applications provider in the categories of Enterprise Resource Planning (ERP), Customer Relationship Management (CRM) and Supply Chain Management (SCM) categories. SAP’s impression as a solution provider for large enterprises only has actually petered out and has now been accepted by both small and large customers as the preferred solution provider.
SAP in India
® SAP started operations in India in 1996
® Headquartered in Bangalore, SAP has offices in Mumbai, New Delhi and Kolkata,
® India elevated as a strategic hub for SAP in 2006
® Leading provider of Enterprise Software Solutions market in Indian with over 1348 customers
® Industry verticals addressed by SAP in India: 26
® No of SME Customers: 883
® New wins in 2006:
Signed on 498 new customers
Over 170 SAP ALL-inj-One Customers
Over 263 SAP Business One customers
® Becomes the first enterprise software solutions vendor to cross the 1000 customers mark in India
® 21 out of 30 companies in SENSEX runs SAP
® 32 out of 50 companies in NIFTY runs SAP ® On an average 7 out of 10 top companies in every vertical in India runs SAP
® Leads the Indian enterprise software solutions market with 54% in ERP, 24% in CRM and over 30% in SME
