SAP’s Anti-Competitive Tactics – The SAP Integration Certification

ByPrimary Researcher

Executive Summary

  • SAP uses its integration certification to control partner software vendors.
  • In this article, we cover how the certification is anti-competitive.

Video Introduction: SAP Partnership Program

Text Introduction (Skip if You Watched the Video)

SAP has the most extensive vendor partnership program of any software vendor worldwide. This program presents the following characteristics to SAP customers and the outside world. SAP has enormous control over its partners, and the arrangement is anti-competitive and corrupt. Once in a partnership with SAP, SAP has approval over the partner’s marketing, often restricting any language that would make a vendor partner from being competitive with an SAP product. You will learn how SAP has weaponized its partnership program against partners.

Notice of Lack of Financial Bias: We have no financial ties to SAP or any other entity mentioned in this article.

  • This is published by a research entity, not some lowbrow entity that is part of the SAP ecosystem. 
  • Second, no one paid for this article to be written, and it is not pretending to inform you while being rigged to sell you software or consulting services. Unlike nearly every other article you will find from Google on this topic, it has had no input from any company's marketing or sales department. As you are reading this article, consider how rare this is. The vast majority of information on the Internet on SAP is provided by SAP, which is filled with false claims and sleazy consulting companies and SAP consultants who will tell any lie for personal benefit. Furthermore, SAP pays off all IT analysts -- who have the same concern for accuracy as SAP. Not one of these entities will disclose their pro-SAP financial bias to their readers. 

What is SAP Certification?

SAP certification is process software vendors go through to declare that their solutions are “certified by SAP.” The software vendor then displays a badge on their website and uses the symbol in PowerPoint presentations. An example of one of these certification badges is listed below.

This is the type of certification graphic that graces many SAP partner websites, as well as presentations. It is non-sensical because NetWeaver never actually existed. 

While valued by customers, and in fact, many customers will not buy without it. SAP puts minimal effort into the certification process. The requirements are very watered down. Typically only a tiny amount of data is transferred between systems and only a very limited grouping of fields. An SAP-certified solution does not mean that the company has a working adapter. Not at all.

However, the SAP certification means that the vendor will follow SAP’s rules regarding the information it provides. The SAP certification is a bit of a bait and a switch. The software vendor often thinks they are getting access to a new market, but they soon learn this is an incorrect assumption. But they are left with the legacy of no longer being able to control their marketing message.

This graphic is so valuable that SAP is known as such a complicated system to integrate into.

  • Through difficulty in integration, SAP keeps an anti-competitive advantage against other vendors. This is because SAP has the core ERP system for virtually all of its customers.
  • Every other system must connect to the ERP system. No other software vendor uses difficulty in integration to such an advantage as SAP. 

The Reality of the SAP Partnership Program

To the outside world and SAP customers, the SAP vendor partnership program seems legitimate and even beneficial to SAP customers.

After many years of discussing the partnership program with many software vendors, a very different picture of the SAP vendor partnership program appears. In many cases, the SAP vendor partnership program may be viewed as not a partnership program, but as another anti-competitive tool SAP uses to restrict competition in the marketplace.

Faux SAP Vendor Certifications

SAP emphasizes vendor certification, and SAP customers like seeing them. In many cases, they will exclude vendors that don’t have a certification from the selection process.

  • Vendor certification logos are prominently displayed on many vendor websites.
  • They ostensibly signal to customers that the solution works with SAP. SAP puts minimal effort into the certification process.
  • We have observed different software vendors have become certified by only passing a single field from sap to their system and back in many cases.
  • SAP has little quality control over the vendors that it certifies.

These bullet points demonstrate how little substance there is to SAP’s certification process and how little it uses the overall partnership system for anything beyond perception management and controlling competing software vendors with their faux partnership.

The Issue with Integrating to SAP

Therefore, the vendor’s statement regarding normalization is why SAP’s data backend is challenging to deal with and has nothing to do with it. SAP has problems with any data backend that it creates, regardless of whether it is ERP (which the vendor here is referring to), APO, or BW. This has nothing to do with data normalization. It has to do with poor software design.

The following quote briefly touches on SAP’s enormously inefficient integration approach. As SAP is the only vendor to wrap its data backend in such opaque complexity, it is the most challenging application to integrate into. The most popular way to integrate into it has been for SAP to push out an IDOC, a hierarchical file format that must be parsed with a transformation language such as UNIX’s Awk. Another way is to use a remote function call (RFC), which has to be coded, and in my experience, has demonstrated several performance problems. Let us see how this compliant vendor soft peddles SAP’s integration weaknesses.

“To control access to the SAP® database SAP® has developed several proprietary integration technologies. These technologies do provide a more streamlined view of the underlying data complexities, but they also introduce new technology barriers that typically require costly development and 3rd party integration tools to overcome. The objects exposed by these integration technologies often don’t provide access to all the data required to resolve an integration challenge. Many solutions therefore end up looking like a mix of technologies and approaches resulting in long-term sustainability issues.”

Notice the phrasing here has to pay homage to what is, in fact, a terrible design. None of the “proprietary integration technologies” SAP has created work well. The section highlighted in blue builds on a point that does not exist. The proprietary integration technologies don’t work well, so the following sentence is problematic because its assumption is false. The problem with one of the major SAP integration technologies is covered here.

SAP’s Incentives to Reduce Interoperability Between Competing Software Vendors

Secondly, SAP does not want them to work very well because they do not want clients connecting the best-of-breed applications to their ERP system. Instead, they want companies to buy other SAP products that compete with the best-of-breed vendors that cannot compete with the best-of-breed vendors. A primary strategy of SAP for several decades has been to direct clients to SAP products because integration is complicated. Integration can be complex, but nowhere is it more complicated than with SAP.

As for the rest of the paragraph, there is some definite beating around the bush, although some negative comments are made, which are listed in blue. Essentially SAP’s preferred integration is no integration. However, I guess some excuse has to be made up. It’s hard to get a partnership with SAP if you declare their data approach an unmitigated design disaster that may have been put in place to prevent integration with best-of-breed vendors. And is probably a violation of the spirit, if not the letter of US Anti-Trust law (SAP’s relationship with vendors where vendors pay them 70% and are on the SAP pricing list seems to harken back to Standard Oil’s business practices.).

Does SAP Care if its Partners Improve Integration with SAP?

In my view, the answer is no.

  1. This is because it is the customer’s problem. Regardless of how effective or ineffective the integration adapter the partner vendors create, behind closed doors, SAP will always tell the customer that integration is a major problem and a reason to steer clear of non-SAP applications.
  2. All non-SAP applications are presented to customers as “a risk.” While SAP applications are offered to customers as a “sure thing.” This greatly over-simplifies all implementation risks to a single factor: the risk of integration complications.
  3. SAP wants the partnership with the software vendors to begin controlling them and making them less able to compete with SAP. For this reason, almost no vendor won’t be allowed into the partnership program.

The integration adapters software vendors provide are always far beyond whatever SAP tests.

Secondly, any application can be made to work with SAP. The fact that SAP does not put work into testing interfaces means that the integration certification has no genuine meaning. And in most cases, there is some customization required in the interface, so few integrations are “out of the box,” as is often stated during the sales stage.

SAP’s partnership contracts hold out the carrot of more business. But they come with very high limitations and control given to SAP, particularly the partner’s control over their messaging vis a vis SAP.

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