How Accurate Was SAP on ByDesign?

Executive Summary

  • For years SAP has said that ByDesign was beating Netsuite with a 90 mph fastball.
  • In this article, we review the accuracy of this claim. 

What SAP Said About ByDesign as Beating or Shocking Netsuite with a 90 mph Fastball

When ByDesign was relaunched in 2014, Bill McDermott stated that NetSuite would need to get ready for a 90 mph fastball, which would be coming for them.

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Ben Kepes analyzed this statement and the outcome in this quotation.

“At relaunch SAP was bullish about the product, even famously suggesting that it would be a “90mph fastball” that would take out competitor NetSuite. NetSuite’s CEO Zach Nelson is still making great mileage out of that fastball that never came. At the company’s SuiteWorld event this year there were the usual (both figuratively and literally inside baseball) quips about the batter being at the plate but no pitcher to be seen. ByDesign saw little adoption and, perhaps more importantly, apparently gained limited executive support internally. Based on a customer count somewhere south of 1000, and given this was a relatively cheap product compared to full SAP enterprise solutions, this lack of internal support was perhaps understandable.”

What Actually Happened with ByDesign?

Reports from multiple sources indicated that ByDesign, one of SAP’s least expensive offerings, was unable to crack 1000 customers. It was unsuccessful enough to be discontinued in 2013 and was then brought back (for some unknown reason) but never really received much development after this point. ByDesign was exorbitant in development cost and is a widely lampooned product at customers that use it. Some customers implemented ByDesign because they were forced to (that is, they were one of Hasso Plattner’s companies), or they were SAP consulting companies that were seeking to show their loyalty to SAP further. That is, by helping SAP increase the number of users. ByDesign never made very much of an impact on cloud ERP competitors. The state of ByDesign was covered in the book SAP Nation 2.0.

“At its architectural core, ByDesign was not built as a multi-tenant solution and SAP quickly discovered that scaling out was a costly nightmare for a solution that could never turn a profit….At that stage, SAP withdrew it from the market and spent 18 months re-engineering so that is could get better operational metrics and performance. It was still a mini R/3 with an interface to match although not as crappy as many in use at the time. Quarters came and went, SAP talked up the ByDesign numbers, eventually plateauing at something like 1000 customers. Of those roughly 250 were what you’d call ‘friends and family’ so that the real in market sales were a paltry 700 to 750. While Howlett described ByDesign as “alive and kicking” in his revision, it’s taken a decade and still does not account for even on percent of SAP’s customers or its revenues.”

Conclusion and Calculation

SAP receives a 0% accuracy rating on SAP ByDesign beating or shocking NetSuite. The quotation by Bill McDermott has repeatedly been used by NetSuite against SAP in its marketing literature.

Link to the Parent Article

This is one of many research articles on a specific topic that supports a larger research calculation. For the overview of the research calculation for all of the SAP topics that were part of the study, see the following primary research A Study into SAP’s Accuracy.