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Gauging SAP's Unsteady Software Evolution: From Application(s) To Platform(s)

December 29, 2010

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SAP's "dominance" as an enterprise application platform has slowly diminished over the past five years. Previously fueled by market optimism, relatively strong economic growth, and a heavy emphasis on centralization and consolidation among SAP customers and prospects, SAP now faces the challenge of proving its value as a more general-purpose platform for business process enablement, supporting not only enterprise applications but also software development and delivery. SAP's prior growth was driven by enterprise applications sales in a relatively buoyant market. But SAP's core strength lies in the traditional on-premises enterprise apps market, which is now facing severe disruption and upheaval. The rapid growth in SaaS and, more recently, cloud computing has driven better alignment of IT capabilities with unpredictable and variable economic conditions, as well as the more dynamic business structures that occur as a result. Springboard Research believes that, despite improvements in its software platform vision, SAP has failed to adapt quickly or broadly enough to meet these changing market demands.

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