How SAP Seeds Innovation

SAP's collaborative Web sites and discussion forums give its customers ways to learn from SAP business partners as well as from each other

By John Hagel and John Seely Brown

Ecosystem is an overused term. All companies have one, yet when you strip away the rhetoric, most corporate ecosystems turn out to be conventional supplier or distribution-channel relationships with a few high-profile "strategic partnerships" thrown in for good measure. When they are not simply fodder for PR flacks, these "relationships" are often driven by short-term transactional needs, with distrust, rather than trust, as the foundation.

This is a shame, because these collaborations can become fertile ground for innovation and learning, not just among a few select partners but across an ever-expanding array of participants. SAP (SAP) has set the standard—certainly within the tech industry—and offers a good example of the potential here.

There are many reasons for SAP's success, but two in particular stand out. First, SAP generated its ecosystem, which consists of customers, business partners, experts and independent parties by addressing the needs of the participants. Too often, companies launch ecosystem initiatives with a clear view of the benefits for themselves, but with a much less developed understanding of the needs and motivations of prospective participants. Second, SAP went further—it focused on the needs of individuals, not just companies. Even though most of its customers and partners are enterprises, SAP recognized that participation ultimately is by individuals. It designed its various collaboration platforms with the goal of making individuals more successful in their daily roles by helping them connect more effectively with the specialized resources most relevant to them.

While many technology companies have invested to build large networks of business partners and customers, SAP is one of the leaders in the scale, diversity, and integration of its vast ecosystem. Companies in many other industries could think much more imaginatively about their own relevant ecosystems, given SAP's experiences.

Impressive Participation

Consider some of the stats. More than 9,000 companies participate in SAP's various partner networks globally, and 1.2 million individuals participate in SAP's online communities. Roughly 25,000 new participants sign up for the latter each month, and from 2006 to 2007, its number of page views doubled, to more than 150 million. Participants contribute some 6,000 online posts per day and create better than 60,000 wikis to handle ongoing discussions, while at least 1,200 bloggers comment regularly on community topics. More than 3.5 million posts have accumulated in these forums, and the pace of activity is accelerating. It took three years to reach the first million forum posts, nine months to reach the second million, and only six months to reach the third million. In total, 100,000 members have contributed posts to the online forums.

Beyond scale, SAP's ecosystem has also developed remarkable diversity, with "communities of innovation" organized around specific areas of practice to address the needs of both individuals and companies. For example, the SAP Developer Network (SDN) provides a robust forum for software developers seeking to generate more value from the platforms and products sourced from SAP and its partners. More tellingly, from the time a developer posts a question until she or he receives a response takes 17 minutes, on average, and two to three additional responses typically come in over the following 24 hours to refine and amplify the initial response. About 85% of all discussion threads are closed as complete.

At the company level, 15 Industry Value Networks bring customers together with a broad range of its business partners to address specific issues—for instance, banks looking to develop software interfaces that will help them collaborate more effectively.