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SAP hopes partnership helps ring up sales

SAP America and ADP are teaming to add HR and payroll services to the German software giant's Business One tools for small companies.

SAP is turning to a partnership in order to help broaden the appeal of its new software for small businesses.

SAP's U.S. subsidiary, SAP America, and Automatic Data Processing, a payroll processing oursourcer, on Tuesday said they have inked a deal designed in part to bolster the German software giant's SAP Business One product line.

Under the agreement, SAP Business One customers will be able to outsource their human resources and payroll functions to ADP via an integrated Web connection.

"The Business One division of SAP is small," said Brendan Barnicle, an analyst at Pacific Crest Securities. "But this partnership will give that business additional credibility, because ADP is well-known for its HR and payroll."

SAP announced SAP Business One two years ago. The package of tools, which deals with tasks ranging from accounting to sales force automation, is designed to improve the integration of the various categories of software applications that a small or midsize business runs.

The deal with ADP "will make Business One's HR and payroll functions more seamless to the end user, so it will make it an arguably more attractive product," Barnicle said.

SAP Business One customers will be able to go to the ADP Web site and create a payroll file, for example. After saving the file, the user would open up his or her SAP Business One application and click on the HR setting. That would then open the saved payroll file and integrate it with all the HR information in the SAP Business One system.

Customers will have the option of using ADP's Windows-based or hosted Internet payroll and HR products, SAP said.

SAP is the largest seller of enterprise resource planning applications, ahead of PeopleSoft and Oracle. The company has gained share in the ERP market in recent months, largely because of uncertainty surrounding Oracle's continuing battle to acquire PeopleSoft, according to analysts. Last week, a federal court ruled in favor of Oracle's hostile takeover bid.