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SAP to ship new sales, service software

Though late to the customer relationship management software market, SAP will ship key parts of its product line next month.

WALTHAM, Massachusetts--Though late to the customer relationship management (CRM) software market, SAP chief executive Hasso Plattner said yesterday the company will ship key parts of its product line next month.

Plattner, who met with business analysts and the press at the German-based company's Massachusetts offices, said the company expects to complete 100 CRM projects by the end of next year and that this new business will likely generate more revenue than the company's core enterprise resource planning (ERP) software product sales. Plattner said the company could make up to $200 million on CRM sales in 2000.

Plattner also said that the company is slated to ship new CRM applications December 15, including software for Internet-based sales, customer self-service, field sales, and call center management. The offering includes e-commerce software that will support online sales and allow customers to check the status of an order on the Web.

Components required to build a CRM user interface, which will initially run on Microsoft's Internet Explorer, will also be available. Software used to build Web-based marketing campaigns will be shipped in the second half of next year, a company spokeswoman said.

Plattner, who said SAP underestimated how the Internet would impact the company's business, also detailed how the company's customers already are using parts of SAP's CRM software.

To date, SAP has shipped few CRM applications beyond a call center application for telecommunications companies, though the company is testing its new appications with a limited number of customers.

A mass shift
Recently, an increasing number of ERP companies have moved into the front-office software space, including Oracle, Baan, PeopleSoft, and JD Edwards. The market for CRM software is expected to grow quickly, to $11 billion in 2003, up from $1.9 billion last year, according to market research firm International Data Corporation (IDC).

SAP and its rivals in recent months have quickly moved toward delivering CRM software, in a market where they eventually will battle against No. 1 CRM market leader Siebel Systems, which SAP is now suing for stealing key executives who were involved with SAP's CRM intiative.

Plattner said he now believes the company is back on track with its strategy, despite the setbacks that occurred when 27 executives and business managers left for Siebel over the past year.

"They were late," said Alice Greene, an industry analyst who heads Newburyport, Massachusetts-based Industry Directions. "But what they have demonstrated is that they can turn around and deliver a leading edge solution that is integrated into the back end, which few, if any, other CRM players have accomplished."

Rob Kugel, financial analyst at FAC Equities, said the jury is out on how deeply SAP's tardiness will hurt the company.

"Luckily for them the mainstream market isn't [ready for Web-based customer relationship management] yet," he said. "If they had it now it would be great, but it's not the end of the world that they don't."

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