Is it time for SAP to try open source?

Although it posted strong earnings, the German enterprise software maker is looking to cut costs amid tough economy. Adopting an open-source model could help.

Despite strong earnings, SAP recently announced that it would cut 6.7 percent of its workforce, or 3,000 positions, according to CNET. While the company reported an 8 percent increase in year-over-year revenue, SAP sees a stalling economy blocking the road before it.

Why not give open source a try?

SAP has invested in a wide range of open-source companies, including MySQL, Red Hat, Alfresco (my company), JasperSoft, and others, but it has never ventured far into actual open-source development and distribution, its MaxDB work with MySQL and its contribution to Eclipse serving as the exceptions that prove the rule.

A few years ago, SAP went so far as to downplay open source's significance at the Open Source Business Conference in a keynote, talking up the need for everyone to jump on the SAP bandwagon and forget the open-source toy.

SAP could arguably use that "toy" right now. Forget source code: SAP needs a more efficient way to get its software in the hands of prospective buyers. Especially in a tight economy, it can't afford to hire an expensive sales force to pan for customer gold.

Its open-source competitors in software for enterprise resource planning may have a ways to go before offering stiff competition to the Germany-based giant, but CIO.com proclaims 2009 as the year of open-source ERP. SAP must be hoping that it's not right.

Adopting open source is not a matter of giving away source code for the love and praise of "community." It's a hard-headed capitalist tool for improving software quality and software distribution. SAP could use both, but especially the latter in this market.

So here's a challenge to SAP: by all means, keep investing in open-source companies, but please also start to invest in SAP as an open-source company. You might find that doing so is just the tonic required to boost sales.

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