Thursday, August 12, 2004

HP blames SAP migration for revenue shortfall

SAP suffered a public relations setback today when HP indicated that a problematic SAP implementation in its $3B+ Enterprise Servers and Storage (ESS) group was partly to blame for a quarterly revenue shrinkage of 5%. CEO Carly Fiorina said that "migration to a new order processing and supply chain system was more disruptive than planned."

In the conference call, Fiorina seemed to indicate that the problems were in the implementation of SAP and not in SAP software itself. However, this distinction is likely to be lost in most reporting. SAP's competitors will no doubt jump on HP's problems as evidence that SAP is a system that is difficult to implement.

Adding insult to injury, HP happens to be an implementation partner for SAP. One would think that HP would have put its best people on the implementation in the ESS group.

My own view is that any enterprise system implementation in a $3B plus organization is going to be difficult. If you dig deep enough, you'll find plenty of similar examples involving other vendors.

Computerworld has more on HP's problems.

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