Mutual Need Drives SAP-Microsoft Alliance


Although any time that Microsoft and SAP cooperate on anything it leads to idle speculation about a possible merger, every now and again even these two giants actually wind up doing something that is just driven by the requirements of mutual customers.

Such is the case with the latest cooperative effort between the erstwhile rivals and sometimes teammates. The two companies have announced plans to integrate Microsoft Office, and Microsoft Excel in particular, with SAP Business Object's enterprise performance management (EPM) software.

Since the downturn, EPM has been red hot because business executives are looking for tools that let them manage the business on a rolling basis. Historically, everybody passed around spreadsheets to figure out the annual budget. But when the budget needs to be reviewed every 30 days on a rolling basis, passing around multiple versions of Excel spreadsheets every month just isn't practical. That said, however, business people are very comfortable with the spreadsheet metaphor, so any type of business intelligence applications really needs to integrate tightly with Microsoft Excel to gain widespread acceptance. So, in effect, what Microsoft and SAP have agreed to do is make Excel the front end to SAP's EPM software.

Some of this cooperation, naturally, is borne of the two companies loathing of Oracle. But no matter how they got there, the two companies seemed to have recognized a need of their mutual customers that they are actively trying to solve. Given half a chance, SAP and Microsoft would prefer to go it alone. But since SAP is never likely to build a decent spreasheet and Microsoft's EPM software capabilities are limitied, the two software behemoths have more to gain by working together. That same thinking has driven past agreements to work together and will lead to future projects as well.

There are, of course, any number of EPM options out there, including some new software-as-a-service approaches. But at the end of the day, the attachment of business users to Microsoft Excel is too hard to ignore. So whoever can leverage Excel is going to have the inside track when it comes to EPM or any other business intelligence application.