Time to Whet Your xApp-etite

By Sam Sliman
President, Optimal Solutions Integration

It is no surprise that the rise of SOA is fueling the creation of composite applications (aka xApps) on the NetWeaver platform. Afterall, SOA’s raison d’ être is to enable monolithic applications to be broken into discrete, reusable ‘enterprise services’ that reside on the network for fast cobbling into xApps that satisfy immediate business needs. That the reverse is also true; namely, that xApps are driving SOA adoption – is a phenomenon more interesting and useful to SAP customers mapping out projects for their SOA initiatives.

It is well known that SOA is a journey, not a destination. As is the case with all journeys of consequence, the first SOA steps are critical. Wander off in the wrong direction and you waste valuable time, or worse yet, lose your way completely. In the emerging new world of enterprise SOA, mis-steps can be disastrous in terms of lost revenue, time and competitive edge.

As an integral part of its strategy to reduce risk, lower the barrier of entry and speed up adoption of SOA, SAP has aggressively developed and promoted xApps as a means for its customers to take the initial steps toward enterprise SOA – and in the process, realize the immediate business benefits of agility, increased sales, IT simplification, and ultimately, cost containment.

Since SAP’s introduction of the xApp term in 2003, the software giant has branded and brought to market more than 60 xApps – not including mobile business xApps, analytic xApps and several hundred smaller xApps embedded in other solutions. A selection of SAP xApps currently gaining traction with marquee SAP customers includes SAP Sales and Operations Planning (SAP xSOP), SAP Manufacturing Integration and Intelligence (SAP xMII), and SAP Resource and Portfolio Management (SAP xRPM), among others.

While these xApps bring innovation to different business processes, they share the common ground held by all xApps of allowing SAP customers to test the enterprise SOA waters in a relatively safe, iterative manner. Eventually, SAP’s thinking goes, as customers travel down the SOA road, they will construct xApps internally – hybrids of exposed services from their existing systems and enterprise services available from the SAP repository. To get the SOA ball rolling now, SAP entices customer to whet their xApp-etite – a strategy that is proving fruitful for SAP as well as for its customers and partners.

xApp license revenue neared $200 million in 2006, and SAP remains bullish on the future of xApps, predicting that in time xApp sales revenue likely will top revenue from ERP licenses. NetWeaver is a prerequisite for xApp deployment. It also is the technical enabler of enterprise SOA. Bringing both NetWeaver and xApps to market concurrently amounts to providing the tools for SOA as well as ready-to-implement proof of concept in a single fell swoop – something no other large enterprise application vendor has accomplished.

For xApps (and by extension SOA) to attain critical mass, SAP is relying heavily on its partner ecosystem. The company has executed bold measures on this score. In April 2006, SAP launched an Enterprise Services Community, a collaborative, cross-industry program enabling partners and customers to define the way software is developed and deployed to solve evolving business requirements. SAP has also established at least eight Industry Value Networks – where the community concept is extended to business experts, SAP staff and SAP partners to drive innovation. These initiatives are already yielding industry-specific xApps.

Additional xApp/SOA advancing initiatives include establishing a $125 million venture fund in May of 2006 to boost xApp development by independent software vendors, and making individual developer licenses for NetWeaver available via the SAP Developer Network (SDN) and Business Process Expert (BPX) community sites, which SAP did in October of this year. In May 2007, SAP released NetWeaver Composition Environment (CE), a set of standards-based and integrated tools designed to speed up and simplify the xApp creation and deployment process.

Commenting on SAP’s SOA vision and partner strategy for achieving this vision, Forrester analyst Ray Wang states that SAP “has chosen wisely to partner and build out through xApps and NetWeaver and their Partner Edge programs […] Of all the vendors, they have one of the most clearly defined roadmaps."

As of March 2007, SAP has delivered 1,000 enterprise services for the SAP Business Suite applications through the Enterprise Services Workplace site on the SAP Developer Network. SAP expects all applications, including those in SAP Business Suite, will be fully service enabled by the end of 2007. The endgame for SAP is to avail to its customers the means to quickly and cost-effectively execute an infinite array of business process innovation initiatives without affecting or compromising the stability and reliability of core enterprise systems.

Industry analyst firm Gartner estimates that by 2008 more than 60 percent of enterprises will use SOA as a guiding principle when creating essential software applications and business processes. Gartner positions SAP as both a leader and a visionary in its 2Q 2007 Magic Quadrant for Application Infrastructure for Composite Application Projects. In a research note issued in September 2007, Gartner states that SAP is “well on its way to delivering on its [SOA] vision.” Gartner concludes its research note by answering the question of whether or not waiting to move on SOA is an option for SAP customers with a straightforward, unequivocal “No.”

Given this backdrop, it is high time for SAP customers to whet their xApp-etite and begin their SOA journey.