SAP Acquisition of Business Objects : By Henning Kagermann CEO of SAP

On January 15, 2008, SAP announced the successful all-cash tender offers for Business Objects S.A. As the global market leaders in business software and business intelligence (BI), SAP and Business Objects have thousands of joint customers, highlighting the synergies that companies are already leveraging by combining the existing products from SAP and Business Objects. With roughly 7,000 employees in the Business Objects organization and SAP unit supporting business user applications, the combination represents a leading organization targeting the business user market.

“With the distinct combination of best-in-class software for performance management and analytical insight, we believe that SAP and Business Objects have the clearest vision and the strongest products to lead this market into the next wave of innovation with business performance optimization,” said Henning Kagermann, CEO of SAP. “With our delivery of SAP Business Suite on an industry-first business process platform and the introduction of SAP Business ByDesign to drive new volume business in the midmarket, we have achieved two of three major milestones in our growth strategy. SAP is now seizing a significant opportunity to pursue the third component of our strategy: leading the market for business user solutions. For SAP, this is the right partner, right timing and right market segment to acquire market-leading innovation that enhances business value for our customers.”

Business Objects Acquisition complements Growth Strategy and targets Trends

The acquisition of Business Objects complements SAP’s existing growth strategy, granting immediate leadership in the market for business user solutions – tools and applications designed to help companies organize and manage information to optimize everyday business activities and improve the way employees work. It allows SAP to reach new customers and expand its footprint in existing accounts. SAP already has made strong inroads into this market with its proven solutions for governance, risk and compliance (GRC), corporate performance management (CPM) and business intelligence.

Growth in the business user segment is being driven by three major trends transforming the business environment: First, companies need to make decisions more effectively based on a broader array of data sources from both inside and outside the enterprise, and from structured and unstructured sources. Second, today’s business users need better tools and applications that go beyond individual views to support collaborative decision-making. Third, companies are seeking competitive advantage by extending beyond their businesses to create and manage business networks with partners, suppliers and customers.

Today, Business Objects provides the market-leading BI platform and tools that unlock information, enable business insight, performance management and financial management, independent of the underlying business applications and data stores. While maintaining and supporting this market-leading portfolio, SAP and Business Objects will work together to build new applications to help business users, teams and companies to better collaborate through networks.

New Market Opportunity emerges for Business Performance Optimization

Together, SAP and Business Objects will tightly link business information with business processes to enable companies to translate insight into action.

As per the sources of SAP, the marriage will bring a long-term effect to both the partners and customers. First to the customers: SAP and Business Objects will help customers directly connect their business strategies to their execution – and back again. In short, we offer customers the ability to translate business insight into immediate action. When business insight can be translated into action, companies can adjust and optimize their processes in real time, tightly closing the loop between strategy and execution.

Our overriding commitment during this acquisition is to protect customer investments, and enhance the value they can derive from their business applications. Our joint customers will benefit from the convergence of market-leading applications in the areas of governance, risk and compliance (GRC), enterprise performance management (EPM), business intelligence and enterprise information management.

We welcome the investments that our customers have made while we work in order to bring additional value to customers. For the partners: Fostering a customer-focussed ecosystem is – and will continue to be–– an important part of SAP’s corporate strategy. Through continued investment in cultivating trusted partner solutions and communities of innovation, and by embracing the partners and resellers of Business Objects, we plan to further expand and enhance the ecosystem and options available to customers and partners.

Secondly, there is a talk that there will be no axing of employees. Though Business Objects Founder Bernard Liautaud has resigned, but he will serve as an adviser to SAP CEO Henning Kagermann until June. By and large, Business Objects will remain a separate business arm of SAP and existing Business Objects distributors and channel partners will remain active under their current programme and agreements.

However, the strategy of the company will be to streamline and consolidate all of its products’ roadmaps. In the areas where there is overlap, the company will immediately take steps to build on as the preferred solution, while placing duplicate products in maintenance mode. The company will provide blueprints to achieve functional parity for the solutions. The overall commitment will be to protect customers’ investments through maintenance rules, migration kits for some solutions, etc.

Partners’ Reaction 
In a strong demonstration of support of the acquisition of Business Objects by SAP AG, partners of both companies worldwide voiced their endorsements, further underscoring the value of the combined offerings and open approach to the market. The partners issued their statements in conjunction with today’s announcement of the next steps in the pairing that unites the global market leaders in business software and business intelligence. The combination of SAP and Business Objects brings together best-in-class software for performance management and analytical insight, offering expanded opportunity for collaboration, innovation and profitable growth, with the two market leaders sharing a common vision to transform the way the world works by connecting people, information and businesses across networks.

In the strongest evidence yet that SAP’s ecosystem strategy is delivering value to customers, partners and developers, IDC recently declared the SAP ecosystem a thriving economy in its own right. With the addition of Business Objects’ extensive partner network, developer community and expertise in business analytics, the vibrancy of this ecosystem is further amplified.

“The tremendous velocity of the SAP ecosystem has ushered in a new era of collaborative innovation,” said Zia Yusuf, Executive Vice-President, Global Ecosystem and Partner Group, SAP. “Now, with the acquisition of Business Objects, the expanded ecosystem offers customers and partners deeper insight and expertise and accelerated opportunities for collaboration and innovation around governance, risk, and compliance (GRC), enterprise performance management, business intelligence (BI), and enterprise information management.”

“The SAP ecosystem brings together SAP, thousands of customers, partners, communities of developers, and business process experts to co-innovate industry-leading solutions, access resources, and share best practices,” said Janet Wood, Senior Vice-President, Global Partnerships, Business Objects. “We are excited about the opportunities for collaboration around performance optimization and business analytics, and look forward to expanding the dialog with this thriving community.”

Accenture 
“According to 160 CIOs recently surveyed, more than 75 per cent of organizations plan on having enterprise-wide analytics in three years time,” said Patrick Puechbroussou, Managing Director for Accenture’s SAP business. “Accenture works with organizations globally to successfully harness and manage information across the enterprise: SAP’s vision for business performance optimization aligns with ours. Our experienced practitioners, already familiar with SAP Business Suite and the Business Objects BI platform, will develop solutions that enable deeper analysis and drive performance through more competitive differentiation. And, the positive partnering environment already in place with both companies means we are optimistic about our joint business opportunities in this market.”

Capgemini 
“Capgemini welcomes the acquisition of Business Objects by SAP. With this step, business intelligence capabilities are moved from being adjunct to business processes to the core of the business“– something which we describe as the ‘Intelligent Enterprise’,” said Paul Hermelin, CEO, Capgemini.”“The combined business has a number of synergies and opportunities around the very hot market area of“‘Performance Management’ and we anticipate that this will bring highly flexible performance management solutions into the market which will be natively integrated into the operational applications speeding up the deployment of performance management solutions. We support this acquisition and look forward to future collaborating for the benefit of our mutual customers and continuing to deliver joint value to the market.”

Deloitte 
“The Deloitte organization welcomes SAP’s acquisition of BOBJ as a significant evolution of our strategic alliances with both companies,” said Ainar Aijala, Global Managing Partner for Consulting at Deloitte. “The combination of the BOBJ business intelligence platform and applications with SAP’s arsenal of world-class technologies should further strengthen SAP’s ability to provide integrated, architected solutions to help customers meet their enterprise-wide information needs. The acquisition will strengthen Deloitte’s ongoing collaboration with SAP to help clients meet information management needs, including but not limited to GRC and CPM. As well, it will support Deloitte’s global CFO Programme, financial excellence and compliance, integrated performance management, and, more broadly, business intelligence initiatives at our joint clients.”

IBM 
“Companies seek to derive greater insight from their corporate information to help them innovate and drive strong results,” said Volker Loehr, IBM General Manager, SAP Alliance. “As a long-time partner of both SAP and Business Objects, IBM enhances these business solutions with a proven, flexible infrastructure including servers and database technologies as well as industry-specific process and implementation know-how. Today, this already provides over 13,000 joint clients with strategic choice, global delivery capabilities and operational return for their projects and business.”

TCS 
“Tata Consultancy Services Limited embraces SAP’s acquisition of Business Objects and sees it as an opportunity to serve additional customers and extend benefits through the combined offerings and open approach to the market,” said Mr. N. Chandrasekaran, COO, TCS. “TCS, with its strong industry and domain capabilities, will be looking forward to leveraging this combination of assets from the two market leaders and offering innovative solutions to our joint customers, providing them with significant business benefits.”

Wipro 
“The combination of business process and analytics applications will enable a new level of business performance optimization that customers are asking for,” said P. R. Chandrasekar, President, Americas & Europe, Wipro. “We look forward to taking advantage of the expanded service offerings afforded by the union of SAP and Business Objects which, together with the deep domain experience of Wipro, will help customers extend the value of their enterprise applications and improve the business context of information.”

Software & Technology Partners: Adobe 
“Today, collaborative decision-making is critical for business users across functions and business processes. We believe SAP and Business Objects have a compelling vision to meet those needs and together they will greatly improve how users analyze business data to make complex decisions more quickly,” said David Mendels, Senior Vice- President, Business Productivity Business Unit, Adobe.”“Adobe has strong relationships with both companies, beginning with SAP in 2003 with SAP Interactive Forms by Adobe and more recently with Business Objects in 2007 to combine the power of business intelligence with RIAs. We are excited about partnering with the newly-combined company and joint prospects to revolutionize how business users engage with corporate information.”

HP 
“HP has enjoyed successful partnerships with both SAP and Business Objects for many years, and we expect our partnership to be strengthened with the completion of SAP’s acquisition of Business Objects,” said Ann Livermore, Executive Vice-President, Technology Solutions Group, HP. “With HP’s strong portfolio of business intelligence offerings, we will continue to work with SAP to provide integrated solutions to help our joint customers solve some of the most complex information challenges.”

Microsoft 
“SAP and Business Objects are both long-standing partners of Microsoft. Our work with SAP has ranged from SAP applications running on Microsoft Windows and SQL Server to our joint Office Business Application development with Duet,” said Jeff Raikes, President, Microsoft Business Division. “We have partnered with Business Objects for 15 years on Microsoft Visual Studio and more recently on the delivery of the Business Objects XI integration kit for Microsoft SharePoint Server. Microsoft enthusiastically supports the combination of SAP and Business Objects, and I welcome the opportunity to build on our joint efforts with these two great partners as they become one.”

Sage 
“Business Objects is a long-standing partner of Sage Software,” said Nina L. Smith, President, Sage Software Business Management Division. “We applaud SAP’s commitment to keep Business Objects an independent business unit, and we look forward to expanding our relationship. Together, Sage Software and Business Objects will continue to deliver tangible value to our mutual customers.”

Teradata 
“Together, SAP and Business Objects offer a powerful combination of both a business information platform and a business process platform enabling companies to translate business insight into action,” said Darryl McDonald, Chief Marketing Officer, Teradata. “We congratulate them on their new union and look forward to working together to deliver the best in enterprise analytics to our mutual customers.”

Decision First 
“The joint company will link together two vibrant and successful communities,” said Taylor Courtnay, Co-Founder & Vice-President of Sales, Decision First.”“We are excited at the prospect of providing enhanced business information solutions and services to a wider range of customers, regardless of the platform.”

Dunn Solutions 
“We are excited about the opportunity to continue to deliver powerful BI solutions to our customers – but with the added benefit of tighter integration,” said Bill Dunn, CEO, Dunn Solutions. “We also feel comfortable that Business Objects will continue to support all of our clients, regardless of their platform, and stay true to its roots.”

IDS Scheer 
“Together, SAP and Business Objects will offer high-value solutions for process – and business-oriented professionals,” said Wolfgang Köstler, Director, MidMarket Solutions Europe. “The solutions will be designed to enable companies to strengthen decision processes, increase customer value and create sustainable competitive advantage through real-time, multi-dimensional business intelligence. For us, IDS Scheer, this combination will boost our ‘ARIS SmartPath solutions for SAP’ and will allow us to increase higher value for our midsize customers.”

itelligence 
“We are very excited about the acquisition of Business Objects by SAP and look forward to collaborating to serve the needs of itelligence’s MidMarket customers,” said Uwe Bohnhorst, COO, itelligence AG. “The combination of business process and analytics applications allows non-technical users to dramatically improve the quality of their decision-making by instantaneously and easily providing the information that they need without having to leave their everyday productivity tools.”

Navigator 
“We are very excited about the acquisition of Business Objects by SAP,” said Grant Fraser, CEO, Navigator Business One Solutions. “Particularly with our small enterprise customers, we see a strong demand for transparency and advanced reporting capabilities – the union of those two companies will certainly help us better serve our customers’ needs and expand our user base.”

SDG Group 

“The biggest opportunity we see is the possibility to extend our customer base to SAP customers who are not currently using Business Objects as a BI solution,” said Fabio Bombana, Partner at SDG Group in Italy. “The combined company and offering will surely allow us to improve our positioning and to approach these customers with a stronger value proposition. We look forward to expanding our partnership with SAP and Business Objects.”