SAP ahead of users in e-commerce push

For some users who want to follow SAP down the e-commerce path, there's a not-so-small issue they need to take care of first: finishing their SAP R/3 installations.

And that won't happen at Internet speed, said several users at SAP's Sapphire '99 conference here last week, after the German vendor announced a promised expansion of its Web development plans.

For example, Amsterdam-based Philips Consumer Electronics wants to start doing business online next year, CIO Henk Sangen said during a speech at Sapphire. "But I'm still not ready with my transactional backbone," he added.

A corporate R/3 system Philips started installing three years ago for more than 10,000 users will eventually be that backbone. But the company is only halfway through the project and will probably still run 20 per cent of its business on something other than R/3 two years from now, Sangen said.

The situation is similar at Wella AG, a maker of cosmetics and hair care products in Darmstadt, Germany.

Wella plans to start doing business online "in a very limited way" later this year, said Wolfgang Hildebrandt, the company's European manager of information technology. But that will involve only direct sales to hair salons in countries that have gone live with R/3.

The company doesn't want to set up e-commerce applications to work with homegrown systems that are scheduled to be replaced by R/3, Hildebrandt said. Fully installing SAP software in Europe could take another two years, he added.

The Internet technology in the works at SAP includes a browser-based R/3 user interface, new online sales applications aimed at users of back-office applications and a My Yahoo-like Internet portal that SAP will use to host an e-commerce marketplace connecting buyers and sellers.

Rival vendors are also trying to latch on to e-commerce with mixes of online business applications and their own Web marketplaces. For example, PeopleSoft has confirmed that an Internet portal it detailed last year will be formally launched in August.

SAP's site is scheduled to open for business in the second half of the year.

But in most cases, SAP and other vendors "are light-years ahead of their customers" on e-commerce, said Joshua Greenbaum, an analyst at Enterprise Applications Consulting.

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