SAP Consolidates Front-Office Software, Announces CoreSystems Takeover

SAP has announced what Reuters called “its biggest product makeover in years,” as the enterprise software conglomerate steps up against rivals. The publication said Tuesday (June 5) that SAP is consolidating its sales, marketing and customer service software, bundling the offerings into a suite of solutions under its business planning offerings.

Simultaneously, SAP also revealed the acquisition of Coresystems, a Switzerland-based customer service software provider. SAP did not reveal financial details of the takeover.

According to reports, SAP’s product consolidation suggests the firm is focusing on its front-office services, having already secured the top-spot in back-office software. The rollup will combine one dozen customer-facing products, designed for its business customers into a single offering dubbed C/4HANA, reports said.

Though SAP is Europe’s largest software firm, its top rival, Salesforce, holds 20 percent of the world’s Customer Relationship Management (CRM) market — more than twice SAP’s market share, Reuters said.

Gartner Analyst Ed Thompson said, “If you measure them against the other big four, SAP is probably the weakest of the lot.”

SAP CEO Bill McDermott previously vowed that the company “has quietly been working on a master plan to disrupt CRM.”

The company plans to shake up the traditional sales-prospecting approach to CRM by, instead, streamlining sales and marketing processes, and enhancing them with back-office data.

“The legacy CRM systems are all about sales,” McDermott said. “SAP C/4HANA is all about the consumer. We recognize that every part of a business needs to be focused on a single view of the consumer.”

According to Gartner analysis, the CRM industry will double its size between 2016 and 2021, reaching a nearly $66 billion valuation. The Enterprise Resource Planning (ERP) market, meanwhile, will approach a $39 billion valuation over the same period.