Agassi serves up “third way” philosophy

If SAP product and technology group president Shai Agassi doesn’t watch out, he might gain the notoriety of a Benioff in industry media: Silicon.com, ZDNetAsia and BusinessWeek all reported yesterday on Agassi’s new “third way” philosophy.

Agassi and SAP’s “third way” dogma is basically a middle-ground strategy between a completely software dependent operation and a 100 percent on-demand solution. It’s natural for SAP to be pushing such a party line, as their plan centers on the service-oriented architecture. With a more succinct explanation featuring “gear box” as the key simile for SAP product, this could catch on.

As Agassi sees it, the business of the future will use a "stable core [of software that] drives the ability to innovate at your pace.” The key will be enhancement packages. As Agassi told Silicon.com: "So think of SOA as a gearbox. We’ll allow the customer to choose which gear they want… by choosing which pack and which enhancement they want."

Agassi’s recent comments all go back to his earlier eye-popping headline-making announcement that SAP software would be receiving no major updates until 2010. “…through 2010,” said Agassi at that time, “new functional enhancements to [mySAP] will be made available as extensions in a series of optional enhancement packages. …this application will continue to provide a stable yet evolutionary business process platform as companies move into the era of enterprise SOA.”

Agassi stated that SAP would instead release optional enhancement packages to mySAP ERP 2005 until the major upgrade four years from now. Under the current business schema, SAP plans to have its business suite 100 percent service-enabled by 2007. Until then, SAP executives will urge customers to use the software vendor’s NetWeaver platform to begin piecing together a service-oriented architecture.

Common wisdom regarding the tacks SAP is taking now are generally figure to be answering to the intensifying competition with Oracle Corporation. Were there any doubt of this assumption, referring to any of the links above will contain price gems served up by Agassi. Here’s a sound bite: “We don’t believe in buying customers.” Ouch!