01 March 2006 | Anusha Bradley

SAP hopes to cash in on the rush for on-demand procurement systems by launching its own products in the next three months.

The enterprise resource planning (ERP) giant launched its first on-demand sales systems last month and told SM that similar procurement products were "fairly well advanced" in the pipeline.

Competitors Ariba and Oracle both launched on-demand systems last year.

"Smaller firms will be an initial target for us," said Usman Sheikh, SAP director. On-demand was popular because most firms' purchasing processes had not reached maturity, so they required a simpler alternative to licensed systems, he said.

He admitted SAP was being "cautious" because it wanted to ensure data quality and integration with its own ERP systems already installed in firms.

Steve Savignano, chief executive of spend management firm Ketera, predicted that most of the larger providers would fail "because they don't understand the subtleties between licensed ERP software and software-as-a-service model".

SMmar2006