Is SAP losing the CRM usability race?

To my mind, there is tremendous need and opportunity for a hosted, subscription-based, easy-to-use CRM solution for small and mid-market companies. That said, I don't see how the demand doesn't, at least in part, cannibalize the traditional SMB on-premise ERP solutions; of which SAP has several already in the market....

If we look into the SAP road map for CRM it is not clear as to how they are going about in making their product available to customers.. In fact, SAP has released 2006s to just five or six select customers to work with the interface and develop corresponding CRM processes. In addition, all users of SAP'S on demand module, released last February, are operating on the new user interface (UI). That's a total of about 40 or 50 customers working with it closely, according to SAP executives.

One of those customers is Siemens AG, the $100 billion global electronics and engineering company, which is in the midst of a massive 10-year project to eliminate 500 disparate CRM systems in its global operations and standardize on SAP CRM. But the problem is none of them connect to ERP...they are way behind in terms of creating value...

SAP had 36,200 customers worldwide. That number is a testament to the company's position of dominance in the enterprise software industry. Yet, it's also emblematic of the company's biggest challenge going forward.

While SAP claims market leadership in CRM, one frequent source of criticism has been that many  CRM licences sit on shelves unused. And usability has been a barrier to CRM deployments, I put a premium on usability, with CRM especially. "I think sales and marketing are the toughest audiences to reach in enterprise software.

I think this little math exercise helps illustrate the significance of what's ahead for SAP.  SAP was founded in 1972. It's taken the company 35 years to gain 36,000 customers and that's with industry-best growth and execution. Now it wants to add another 64,000 in four years.  I do give SAP credit because it's important to get this right. Relative to their traditional UI, it's easier to use, but SAP's competitors are doing that too. It's a race, and SAP is not ahead.