“With Shake-Up, SAP Seeks Better Customer Relations"

SAP, the largest computer software company in the world, announced that they will begin to focus more on restoring damaged customer relationships. This drop in consumer satisfaction and customer retention rates has been caused by delays in the development of highly anticipated new technology, and the slight raise in annual maintenance fees. Although SAP founder Holger Kisker simply states, “customers are unhappy”, this damage is not entirely irrevocable.
I believe that regaining back lost customers can prove to be a daunting task, especially now when both the consumers and the companies are hindered by the economy. One of the main issues the article focuses on was the delay in the development of Business byDesign, SAP’s new line of internet-based software. It is widely understood that research and development are extremely costly to any company, and the fact that SAP has not recouped any of that cost is definitely a contributing factor to this lack of consumer happiness. SAP spent a lot of effort on trying to rapidly accelerate sales by increasing their prices, but now with the global economic situation, this plan detrimentally backfired. I understand that the most important aspect of running a business is receiving profit, but SAP appears to have temporarily forgotten about consumer relations.
Business byDesign is set to launch in mid 2010, but that date alone is over three years behind the original anticipate date. If I was a customer of SAP, and another company had compatible software which had been launched at an earlier date, I would have purchased from them instead. Many people have this mindset, and in instances like this, loyalty is not a deciding factor for a consumer. SAP instead, should have focused on launching the software as soon as it was completed. With regards to the increase in prices, many companies are participating in actions like this. Businesses need to make money, but raising the price of mandatory fees is not the way to increase sales or maintain customers.
SAP “made its fortune selling powerful and expensive systems to large corporations, but that market is becoming saturated.” Competing with Microsoft, Oracle, I.B.M, and various other computer software corporations, has more than likely caused a decrease in market share for SAP. I think SAP should partake in a strategic model of differentiation. By differing their product from the products of their competitors, SAP may be able to regain customers back, while simultaneously increasing their market share.
This computer software company must restore their consumer relations. Without a healthy, loyal consumer base, no company can expect to make profi. I believe in times of economic distress, corporations must focus on maintaining these relationship, for it is absolutely crucial for upholding a business. SAP’s chief technology officer Vishal Sikka has vowed to get increasingly “serious about refocusing on its core strengths”, and I argue that in order for SAP to preserve its market share and dwindling consumer base they must consider differentiating their product, speeding up the launch of Business byDesign, and they must determining an alternative to raising obligatory consumer fees .

Jolly, David. "With Shake-Up, SAP Seeks Better Customer Relations." New York Times 10 Feb 2010: B3. Print.