It’s hard to find a really good metaphor for the relationship between SAP and Open Text(OTEX). Open Text announced at their user conference that SAP will be remarketing OT’s Vendor Invoice Management as well as a recently acquired Captaris capture solution under the SAP name. Lately, much of OT’s growth has seemed to come from this new / old relationship with SAP. You can’t argue with success. Clearly their SAP resell channel, particularly outside the US, has been largely responsible for their “stronger than the competition” performance of late.
The success of the resell channel drew me into looking closer at the dynamics in play. Content management as infrastructure is something we have promoted for years with varying degrees of success. What has played out however is that more often than not it is application platform rather than the service layer that tends to drive the decision making.
If a customer adopts SAP, at some point they need a content management solution – then they go buy what the ERP vendor tells him works best -so much the better if its bundled on the same license agreement. Saves you a trip to see your legal department. Seldom is the service layer genuinely defined first apart from the business application layer.
SAP (despite being included in Gartner’s ECM report) is not a significant player in ECM. I’ve written before about their pushing of iXOS,the cooling off after OT bought them followed by the recent thaw and heating up of the relationship. More often than not, sales of SAP business apps are leading to supporting content management deals.
What about the other players. The most obvious example elsewhere is Oracle Financials (with other acquisitions JDEdwards and Siebel) will surely drive the acquired Stellent UCM and iBPM product lines. In this case the marriage was official but the result is the same. ECM sales driven by ERP. IBM business applications have pushed Content Manager but now they have FileNet as a better choice.
So, where does that leave EMC or more specifically – CMA. It may be time for an arranged marriage with a top tier ERP other than SAP. Oh sure, they might try and steal SAP away from OT. Documentum’s SAP integration is actually good but the iXOS ties run deep and it is the SAP sales force that must be won over. Who should they court though?
Unfortunately the obvious choices may be spoken for. Infor comes to mind as they are by some accounts #3 in the ERP space and are privately held. They are however an IBM partner. Farther down the line – Lawson has great promise as a challenger to SAP’s dominance in spite of lack luster first quarter results. There again IBM is listed as a parter. There are a few other interesting options including some open source. Of course there is the Microsoft suite as well. The question with Microsoft is whether or not Open Text has that relationship in hand and the fact that you always run the risk of Microsoft coming out with their own CMS support with SharePoint.
EMC-CMA needs serious relationship building with major business application vendors that is on par with the OT SAP relationship to maintain the prominence it now enjoys. EMC’s transactional content management offerings in particular have improved but without close ties with the broader business applications that need it, they will struggle to make the case to customers to choose theirs over what the ERP vendor has in his catalog.
As to SAP – they may never acquire OT, but if they live together long enough – sales people just start to assume there is no other option and history repeats itself.