Wednesday, May 22, 2024

IBM vs. SAP, Round X and Counting

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IBM and SAP are the best of friends when it comes to implementing SAP software, which is why they avoid calling out too loudly when one takes a major swipe at the other. Which is also why you might not have heard what the real motive was behind IBM’s recent acquisition of Trigo Technologies.

So here it is: IBM’s acquisition of Trigo was a direct blow against one of the hottest new offerings in the growing SAP portfolio, Master Data Management, or MDM. The fact that Trigo was an SAP partner in SAP’s NetWeaver initiative, of which MDM is a key component, only sharpened the blow.

MDM is one of those new offerings that, once explained, usually elicits comments like “it’s about time” and “sign me up yesterday.” The basic idea is that MDM is designed to solve the problem of unsynchronized, disparate data across the enterprise by supporting the proverbial single version of the truth for key corporate data assets like the customer record, the parts master, the bill of materials, etc. etc.

Most companies have multiple applications with multiple definitions of these data assets, and these multiple versions wreak havoc on a company’s ability to efficiently manage data, applications, and the business processes that depend on them. The result is redundancy, waste, and lots of lost opportunities.

Solving these problems is exactly what MDM is trying to do. How that is done is a little more complicated than I’m letting on, but the bottom line is that every company has a massive data synchronization problem that MDM can help solve. Almost to its surprise, SAP has be discovering that the MDM part of its rapidly growing NetWeaver initiative is the one piece that customers really get.

Which is why Trigo is so interesting to IBM. Trigo cut its teeth in the on-line retail world, helping customers produce and manage master catalogues that were then “customized” to meet the needs of specific buyers. The Trigo product line evolved to be called a product information management solution, and then a data synchronization solution. But the basic concept was the same: create and manage a single corporate data model for product information, and then “subset” those data for specialized or customized tasks.

Focusing on the problems retailers have with product catalogues turns out to be a good place to start down the road towards competing with SAP’s MDM. The complexity of these catalogues and the number of attributes they need to keep track of is daunting. And the requirement to support multiple output scenarios, is, in the specific vertical markets that Trigo was tracking, exactly what MDM is trying to do as a horizontal play.

The fact that Trigo was focused on three markets — retail, consumer products, and electronics — means that IBM has a long way to go in turning Trigo into a solution that will have broad horizontal appeal. The trick to this whole market — whether the solution comes from IBM or SAP — is in the data models: Predefining and pre-populating this kind of solution with a master data model specific to a given vertical is essential to making these kind of solutions affordable. Absent these vertical models, the cost of customization become daunting.

Of course, SAP has a similar task with MDM. The product is still quite new, and has yet to be implemented in its full-blown fashion as the unique corporate data repository it promises to become. Early MDM customers are concentrating on data cleansing and synchronizing data between applications, not in letting MDM own the “single version of the truth.” But don’t worry, that’s coming soon. The interest in MDM is that strong.

Meanwhile, BM’s main goal for now is to integrate Trigo into its WebSphere technology stack. That shouldn’t be too hard, as Trigo has been a long-standing WebSphere partner and owes most of its success to date to its IBM relationship.

So don’t be fooled by the lack of overt competition between SAP and IBM. There’s a bloody little war going on, pitting NetWeaver against WebSphere for the hearts and minds of corporate users. MDM’s potential success hasn’t gone unnoticed by IBM, and Trigo is its answer. This is only round X, with many more to follow. Stay tuned.

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