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April 16, 2009

NetSuite Looks to Fill SAP Holes

By David Sims, TMCnet Contributing Editor


NetSuite has announced a new version of NetSuite OneWorld for large SAP (News - Alert) enterprise customers "at the divisional level," while retaining their current SAP on-premise systems at the corporate level.

Officials of NetSuite (News - Alert) say that with the new version, "large SAP legacy accounts can now use NetSuite's on-demand application to manage business operations," and roll up division-level transaction and summary data.

Key to NetSuite OneWorld for SAP is a new integration offering called SuiteCloud Connect for SAP, which lets SAP users roll up data to their SAP system at the corporate level and any data that was captured and used in NetSuite OneWorld at the divisional level, such as general ledger, order and revenue information.

This new offering is a pretty clear indication that NetSuite sees a huge market opportunity -- namely, large enterprises seeking to control costs and gain greater efficiencies across processes that are tired of the high price tags on corporate implementations which don't deliver what they expect. NetSuite's betting that they'll be in the market for more malleable, customizable and flexible software systems than those provided by the corporate parent company.

Zach Nelson (News - Alert), CEO of NetSuite, admits as much when he says: “NetSuite OneWorld for SAP enables large companies to keep their investment in legacy business applications, while deploying a Web-based business application suite that reduces costs.” Nelson knows nobody's going to rip out their huge enterprise installations, but he also knows they're not getting everything they want from them, either.

Bruce Richardson (News - Alert), chief research officer at AMR Research, notes that with this offering, NetSuite is looking to exploit one of the gaps in SAP's strategy -- the lack of a cost-effective product for smaller sites -- by providing a way to link the hub and spokes via the new SuiteCloud Connect for SAP.

“This is a product and services offering that allows SAP customers to roll up transactional data generated by NetSuite applications, including invoices, purchase orders, shipments, inventory adjustments, invoicing, and order and payment integration with point-of-sale systems,” Richardson explains. “NetSuite is positioning its product as more functional than SAP Business One and less expensive and complex than SAP Business All-in-One and the SAP Business Suite.”

Richardson called it overall “a very clever move” on NetSuite's part that “should generate attention from C-level executives looking to drive down IT costs as the economy slips and slides.”

David Sims is a contributing editor for TMCnet. To read more of David’s articles, please visit his columnist page. He also blogs for TMCnet here.

Edited by Patrick Barnard



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