Executive Summary

  • There is currently a declining value on SAP.
  • We cover topics such as the truth about SAP, our competitive sales support, licensing and other topics.


This subsite is called How to Beat SAP, which is a subsite of Brightwork Research & Analysis. This is designed specifically for salespeople that compete against SAP.

We will get into the offering, but first, it is necessary to get into some background into SAP, and how this supports how to compete against SAP, which is relevant for any vendor that competes with them.

The Declining Value of SAP

SAP is very popular. It is one of the largest software companies in the world, and when combined with the revenues of its consulting partners (Deloitte, IBM, Accenture, etc) it is the largest software company in the world. However, in all this financial success, something that is often missed is that SAP’s software has a long history of providing low amounts of value to their customers. SAP first hit it big in the 1980s with ERP systems, but their applications, a large software ecosystem with roughly 300 products, has been far less successful. For many years SAP promised that new versions of the software would be better, but now that illusion is coming to an end.

The Truth About SAP as Legacy

SAP is now legacy.

SAP has used its ERP system to push customers to buy more systems from SAP. However, after customers purchased the ERP system, they faced a diminishing marginal utility from each additional SAP purchase. There is a strong trend at play here and it has been largely ignored. But the more the company invests into SAP, the less they incrementally get out. That has been the reality for the past few decades. And now, there are now increasing liabilities to maintaining or growing one’s SAP footprint. Costs continually rise, and any company is now potentially subject to an audit, and to indirect access fees that in most cases would never have been actionable at the time the SAP software was purchased.

With its top selling ERP system, SAP embarked on diversification into other application categories in the 1990s. Let us now discuss those applications.

Post SAP ERP System Applications

If we review these applications, while they have certainly generated sales, none of them can be considered successful technically.

Here is a brief overview of post ERP applications that SAP released.

  • SAP BW – Business Warehouse: A lagging BI application with famously high operating and maintenance costs.
  • SAP CRM: Very close to a dead application.
  • SAP PLM – Product Life Cycle Management: Never actually existed.
  • SAP Netweaver: Never actually existed (a container or marketing construct for a hodgepodge of mostly infrastructure tools)
  • SAP SRM – Supplier Relationship Management: A dead application (supposedly replaced with Ariba)
  • SAP APO – Advanced Planner and Optimizer: A lagging set of supply chain planning applications.
  • SAP MDM – Master Data Management: A dead application.
  • SAP Solution Manager: A dead application.

These were all home grown applications. SAP customers invested enormously in these applications, and what was the payoff? Each of the applications above either does not work or is limping along in companies. Each of the applications has declined in prominence since released. Imagine how many resources were wasted in buying, implemented and maintaining these applications?

However, none of the acquired applications are even as prominent now as when they were purchased. In fact, most are considerably less prominent, and as development lags, they follow a trajectory very similar to IBM’s software acquisitions where they become out of date and less relevant as time passes. SAP has quite a lot in common with IBM. IBM is doing reasonably well financially, but IBM has lost its ability to innovate or even to provide much value. SAP is now facing a future where the cloud is clearly the future, and SAP is mostly pretending it is the cloud for Wall Street instead of making the changes it would have to in order to be a cloud vendor. SaaS actually undercuts SAP’s entire business model.  SAP is based upon locking in customers. It is based upon enticing consulting companies to always recommend SAP based upon giving them highly profitable consulting projects. But with the cloud, highly profitable consulting projects go away. And without them, they won’t be recommending SAP.

So hopefully that sets the stage for the vulnerability that exists with SAP. Yet, while this vulnerability does exist, there is significant complexity in exploiting this vulnerability.

How Our SAP Competitive Sales Support Works

We offer support for sales people working in vendors that compete against SAP. SAP is difficult to compete against because of things ranging from its strong brand to its influence with the large consulting companies to its high degree of control over the IT media, including the most influential IT analysts. At a simple level, we provide information about SAP, that can then either allow you to improve your positioning on the prospect or communicated to the information directly to prospects.

This is explained in the following graphic.

Brightwork Research & Analysis’ Media Output

Brightwork produces large amounts of detailed content that tells the real story on SAP. We are one of the very few entities that publish about SAP in this way. Secondly, in addition to being researchers, we have hands-on SAP implementation experience going back for two decades. Therefore our research is based upon deep subject matter expertise. This includes the following:

  • 5 SAP written on books
  • 5 books on IT decision making (see book link here)
  • Over 2000 articles on SAP and enterprise software.

Competitive & Sales Intelligence

Vendors sometimes have dedicated sales intelligence groups. We have had interactions with a number of these types of groups. The issues that salespeople often find in using these groups with respect to SAP include the following:

  • Largest Vendors: Only the largest vendors normally have competitive intelligence groups that focus on competitive software. Smaller software vendors tend to offer salespeople no SAP defensive or competitive support.
  • Based Out of Marketing: These groups tend to be out of marketing and normally do not employ software experienced resources. Often because they are based out of marketing, competitive intelligence groups can end up reinforcing what the sales force would like to hear, rather than what is true.
  • NonSAP in Skills: These groups do not normally have direct hands-on expertise in SAP.
  • An Application Only Focus: The groups typically focus on the competitive vendor’s applications. This can be valuable. But not if the focus means taking information from SAP’s inaccurate marketing collateral. Competing against SAP is so much more than simply doing gathering intelligence about its applications. Every major consulting company and most the IT media is already aligned with SAP, so quite a bit more is required. One example of this is the topic of indirect access, which has nothing to do with SAP’s applications pre se but is related to contract terms and a number of other intersecting topics.

All of these factors can combine to limit the benefit that salespeople get out of the competitive intelligence groups in their own companies. And that is if they even have these groups, to begin with.

The type of support we provide can be either for companies that have no internal SAP competitive intelligence group, or we compliment the sales intelligence groups inside larger vendors because we offer different types of information, different exposures, and understanding of SAP. We also combine this with Brightwork Research and Analysis’ demonstrated ability to publish on topics that bring to light what SAP does in a way that usually no vendor will.

SAP’s licensing impacts non-SAP vendors, because SAP uses the confusion and complexity around its licensing to push customers into purchasing SAP licenses that in many cases the customer does not want or does not need. Indirect access is merely an extension of this strategy. 

SAP Licensing and Terms

  • Most SAP customers poorly manage their SAP licenses.
  • SAP Customers have IT departments and procurement departments that are normally over-matched when it comes to dealing with SAP license management complexity.
  • SAP Customers lack the bandwidth in most cases to even properly measure their license usage, and unlike most other vendors that tend to be far more lax on how their software is used.
  • SAP requires companies to run a yearly report on the system that provides some, but not all usage to SAP. For instance, SAP cannot, presently, see indirect access usage as part of this report (this may change in the future). The customer usually cannot make heads or tails of this transaction.

This complexity in licensing and terms gives SAP the advantage and means less money for other vendors. What many vendors that compete for business against SAP often underappreciate how much the budgets available for new purchases is continually hollowed out by the SAP spend. In our analysis, SAP customers have some of the most shelf ware versus the licenses of any other vendor. (Oracle would be an easy second.)

The Beneficial Outcome: The more that the customer knows it’s SAP license position, the more budget can come available for the purchases of other software. As part of BIAA membership, you not only get support on SAP licensing for what we know but also access to new questions that are beyond the normal types of questions and get into new scenarios. We have access to this information through our partners with specific domain knowledge in SAP licensing and terms. This way, as a vendor you know information that in many cases your prospect will not share with you.

  • Negotiation depends on several factors. One is the quality and experience of the negotiator. Another is the quality of information on the topic being negotiated. BIAA helps with both of these areas.
  • The better the customer is able to negotiate with SAP on indirect access and other terms, the more budget is available for you as a non-SAP vendor.
  • Licensing and indirect access cannot be optimized without also understanding of SAP software. This includes SAP’s roadmap and the probability of SAP meeting this roadmap (or perhaps even changing the roadmap)

Negotiation Reference Support

The BIAA is primarily a research, publishing and information sharing entity. Yet, we provide both the support and information that can be used in a negotiation with SAP and we have also partnered with specialized SAP contract negotiation entities.

  • The reality is that if your customer or prospect faces an indirect access claim from SAP and they don’t have appropriate representation, SAP will take far more out of the account in license dollars, and therefore implementation dollars. They will also be far less willing and able to buy from you.
  • SAP has the highest TCO across all of the software categories in which it competes. A single $1 in license sales results in a higher multiple of implementation and maintenance expenditure than any other vendor.

SAP has a specific way of bringing an indirect access claim and a way of managing the timeline that puts their customers into disarray. And after the conclusion is reached, the presentation (in most cases) will be that the customer purchased the SAP software of their own free will, even though it was the indirect access claim by SAP that forced the change in behavior.

The Beneficial Outcome: All of the negotiation reference support is covered as a part of membership. If the issue results in the need for an actual contract negotiation entity, then this is where we can refer the client (thought you) to an entity that they can leverage that is the best fit for their needs. The client would then engage the negotiation entity directly.

Service Offerings

We offer the most in-depth and extensive sales support for SAP that is available. This takes the form of:

  • Articles (both public and private)
  • Specific Support Questions Answered
  • Phone Support
  • Remote Discussions on SAP Topics with Prospects

In addition to indirect access, Brightwork Research & Analysis has the largest and most detailed and accurate database of SAP material related to the actual capabilities of SAP versus the stated capabilities of SAP’s software.

For instance, we were the first and the most comprehensive to debunk much of the marketing claims around HANA and S/4HANA, the first to produce reality-based research into the actual implementation results from S/4HANA (one example being What is the Actual Performance of HANA, and Which is Faster HANA or Oracle 12cOur projections have held up quite well.

We are well known for evaluating SAP software and SAP media output. The following also apply to us:

  • SAP Project Exposure: In addition to decades of SAP consulting experience, we consult and visit and review SAP accounts where the observe the actual usage of software versus the sales proposals as to how the software would be used.
  • 100% SAP Focus: We focus entirely on SAP and are one of the few entities to actually objectively analyze SAP rather than simply repeating SAP’s media output and promoting SAP.
  • Combining SAP Product Knowledge with Indirect Access: This capability is inherently related to SAP indirect access as indirect access is always specific to an SAP application, and requires both knowledge of indirect access, licensing as well as the current and projected state of the application.

The Beneficial Outcome: Competitive intelligence is included as part of the membership and positions vendors far better to compete with SAP.


If you are interested in competing most effectively with SAP, we offer your best option. To discuss, open the chat widget, which is to the bottom right.