Anyone who has read anything on these pages should know by now the emphasis on and advocacy for selling by role (role-based selling) and industry (selling by vertical KBR). It is the only way to sell an enterprise solution and software in particular.
While the Enterprise software market remains fragmented, SAP maintains the largest single share. That is why it was a surprise to see SAP pull back from the financial services’ sector and spin off much of its industry capital. SAP’s decision to spin off its vertical IP means the world’s biggest ERP provider could not effectively compete in one of the world’s biggest industries. Presumably, and this is the author’s speculation, the new entity can pick and choose which technologies and platforms it offers its customers and not be tied to HANA (platform and database of choice at SAP) or even SAP’s Cloud.
SAP and a company called Dediq have formed a partnership using the FSI (Financial Services Industry) name, which was then branded SAP Fioneer (all indications are that this name is final). What do you make of this scheme by a company that counts Comerica, Deutsche Bank Italia, Bank Of India; et cetra as customers and yet cannot effectively compete in the arena? What is the contribution of Dediq to this venture aside from a multi-million dollar cash outlay? SAP and Accenture had an agreement regarding developing solutions for Financial Services previously. SAP was called “a leader… in retail banking” by Gartner among others in 2016.
Two points come to mind. Firstly, what hope do other ERP providers have in serving multiple industries when SAP and its €28 billion in annual revenue cannot? Secondly, does this serve as another reminder how important it is for enterprise service providers to focus vertically and do so in-depth?
Things That Need To Go Away: Horizontal Solutions With No Depth