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By Mel Duvall
SAP has had a rough start to the year, after having to dismiss its chief executive in the wake of customer dissatisfaction. But it had good reason to celebrate this week.
The German software giant says it has landed one of the world's largest brands, St. Paul, Minn.-based 3M, as a customer for a global rollout. SAP said 3M has selected its SAP Business Suite 7 software as a replacement platform for a number of legacy platforms installed in its sites around the world.
"SAP business solutions will play an important role in unifying core processes globally and supporting our ongoing strategy of meeting customer needs wherever they are," 3M chief information officer Ernie Park said in a statement. "We expect the SAP deployment to provide significant value to 3M in the coming years."
Park noted that 3M has made a number of acquisitions over the years in fields as far ranging as healthcare and highway safety. Each of those acquisitions brought often distinct business processes, and legacy software installations to handle those processes, into the 3M fold. The company now plans to undertake the formidable task of phasing out those legacy systems and replacing them with SAP offerings.
Park said the company hopes to be able to "improve customer intimacy, service delivery and power each of our divisions and regions of operations with industry best practices," as a result of the global rollout.
The deal couldn't have come at a better time for SAP as it has faced questions about customer dissatisfaction in the wake of a botched plan to increase support fees. The company also saw its net income fall 4 percent in 2009 in the face of a global recession. And under former CEO Leo Apotheker's leadership, SAP announced close to 3,000 job cuts -- the first in its history.
The 3M win almost certainly comes at the expense of Oracle and other enterprise resource planning (ERP) software vendors, which would have installations at 3Com's various businesses.
SAP said business intelligence software will play a key role in the global deployment, enabling 3M's management to access accurate and timely data on business performance across its divisions. The SAP platform will take advantage of efforts to integrate BI software from BusinessObjects into its application portfolio.
The news came just as SAP's new co-CEOs, Jim Hagemann Snabe and Bill McDermott, took the stage at the Cebit trade show in Hanover, Germany Tuesday. The co-CEOs pledged that the new SAP would have less bureaucracy and a stronger focus on customer needs.
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