After TomorrowNow: SAP appears to be retreating from Oracle consulting business

The mass defections of senior executives from its TomorrowNow business—and an accompanying announcement that the unit might soon go up for sale—is an indication that SAP’s strategy of making money by offering service contracts to Oracle customers wasn’t such a good idea after all.

11/29/2007


The mass defections of senior executives from its TomorrowNow business—and an accompanying announcement that the unit might soon go up for sale—is an indication that SAP ’s strategy of making money by offering service contracts to Oracle customers may not have been
SAP purchased TomorrowNow—which specializes in third-party maintenance and support of JD Edwards, PeopleSoft, and Siebel applications—in January 2005. Since Oracle had recently acquired those three vendors, SAP’s purchase of TomorrowNow was an obvious attempt to siphon potential revenue away from Oracle.
In addition to offering these new Oracle customer-service agreements, SAP
The plan went sour in March of this year when Oracle sued SAP, alleging that TomorrowNow consultants were
A February trial date has been set in U.S. District Court in San Francisco. It’s possible, however, that SAP could sidestep the legal action by selling TomorrowNow. The stage for such a move was set
In a news release announcing this “management transition,” SAP also said it is considering several options for the future of TomorrowNow, including a possible sale.
Currently, Mark White, who was appointed executive chairman of TomrrowNow in July, is running the business.
“Our primary focus is TomorrowNow’s existing customers, who will be supported through this management transition,” White said in the news release. “SAP is prepared to manage through these changes to ensure that TomorrowNow’s obligations to its current customers are met. Over the next days, we will be communicating with TomorrowNow customers about these changes and our plans to support them going forward.”





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