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SAP GOING TO MORE INSIDE SALES

John Schwarz pictureSAP has moved towards greater utilization of inside sales personnel in response to the smaller size of deals it finds. This change was outlined earlier this month at Deutsche Bank's Securities Technology Conference by John Schwarz, CEO of BusinessObjects, which SAP purchased in January 2008. Schwarz is also a member of the SAP executive board.

The move might not be seen as affecting the midmarket. But given the accepted view of Dynamics AX as nibbling at the low-end of the Oracle and SAP markets, then at first glance, the change has some long-term implications for competition on the border between Tier 1 and mid-market products. The standard explanation has been that a high-cost structure keeps the Tier 1 players from coming down market effectively. And the low-cost of AX gives Microsoft the ability to offer functionality in this space at a much lower price than the Tier 1 competitors can. However, if SAP can fundamentally change the cost structure, then it would appear SAP, at least, can better protect its down-market flank. Schwartz said SAP adopted the model from BusinessObjects, which had a higher-volume, lower-dollar-transaction sales model. Schwartz termed that model “a business SAP has to be able to manage.”
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