Integrating Magento with SAP® – Overview

Last December I wrote about how we were dedicating 2011 to integrating Magento with SAP®’s Business Suite platform (R3, ECC, All-in-One) via our Corevist service.  We’ve learned a lot in the past seven months and today, on the eve of Office Relief’s ecommerce website going live; I’m going to start to share some of our findings with the community as a whole.

To begin with, as with all IT based projects, it’s easy to fall into the trap of thinking that integrating Magento with SAP® is strictly a technical exercise.

It is far from it.

The experiences of our three active Magento/SAP® projects and the scores of conversations we’ve recently had with Manufacturers of all sizes, have re-taught me the lesson that launching a successful ecommerce website is anything but a simple technological exercise.  It is a complex business undertaking that spans many parts and levels of the Manufacturer’s organization, often times crossing many time zones as well as functional, political and cultural boundaries.  It always requires interactions and negotiations with a myriad of business and technology partners and can have dire consequences if it fails…after all, no one wants to be responsible for driving away customers!

What makes the integration of Magento and SAP® especially challenging, is that technically, both are world class platforms that were designed to be the system of record for practically all of the core business objects and processes required to manage an ecommerce website.  Both want to own: the definition of products, determination of pricing, calculation of taxes and shipping, the placement, shipment and tracking of orders and the administration and reporting on all of these.  Frankly, applied to the right business problem, they both perform very well in their own right.  That’s what makes them “best of breed”.

So with all the technical and political turf battles going on here, why would b2b2dot0 be interested in integrating these two platforms?  We’re committed to doing so for three reasons:

First of all, we’ve been asked to by our clients and prospective clients.  That should be reason enough!  Companies like The Cycling Sports Group (CSG), Office Relief and Blount are operating under the following strategic assumptions:

  1. SAP® is the backbone of their company and is responsible for all financial, sales transactions, logistics and corporate reporting matters.  SAP® is the center of their corporate universe and will absolutely remain so.
  2. SAP® doesn’t manage marketing content efficiently or effectively.  (In other words, the marketing department doesn’t want to depend on IT in order to update images, add product videos or change descriptions…)
  3. SAP® doesn’t provide a good B2B user experience on the web (at least affordably)
  4. The web is a must; it is not a “nice to have”.  (Believe it or not, there are still quite a few companies out there that are still waiting to see if this “internet thing” is real or might just be a fad.)

Based on these strategic assumptions, and the belief that simple architectures produce manageable systems, all three companies have decided that for their B2B scenarios:

  1. SAP® is the system of record for all master data and transactions,
  2. Magento will manage web content, catalog data and merchandising, and the shopping experience
  3. b2b2dot0 will provide SAP® master and transactional data to the web as well as manage the checkout process
  4. b2b2dot0 will provide a single sign-on, and manage the security model, across all three systems.

Secondly, after examining the current state of the art in integrating the two platforms…simply put…we can do so much better.

Seriously, take a look at the following architectural diagram of what a “typical” production ecommerce website’s data processes looks like:

b2b-outdoor-store-process-flow

 

Just count the number of times you see the words extract, interface, import, export, and trigger in this diagram.  What you don’t see in the diagram is the word replicate…that’s just assumed!  This is a production website that is obviously fraught with operational vulnerabilities and is a maintenance nightmare.  No doubt it’s a customer services challenge as well and desperately needs replacing!

Lastly, it’s important to our future.  Our SAP® Magento integration (we partner for Magento branding and design) is providing us with a sustainable competitive advantage in an expanding market.  We sense the changes in the B2B ecommerce market by the conversations we’ve been having in the last 18 months.  More and more manufacturers are looking for alternatives to the “big ticket” “enterprise class” ecommerce solutions like ATG, IBM, Demandware etc.  They are just too big, too expensive and too difficult to implement and maintain.  eBay confirmed that when they recently made the decision to purchase the Magento platform.  Many of them are also looking to replace their version 1.0 standalone ecommerce websites “experiments” (see diagram above) with solutions that better leverage their commitment to SAP® in a scalable and sustainable way.

So we’re all in.

We’ve placed a “bet your company bet” on the importance of Magento to B2B ecommerce in the SAP® space.  We’re excited because our clients are excited.  We’re also very encouraged by our traction and momentum in the marketplace and the rate at which it is growing.

In the coming blog posts I’m going to take a deeper dive into the details of how we get Magento and SAP® to play nicely with one another in both B2B and B2C scenarios…both technically and organizationally :-).

You’ll learn about the features that we’ve developed that address the synchronization and management of the following business objects in the SAP® – b2b2dot0 – Magento solution:

  • Items
  • Prices
  • Inventory
  • Personalized catalogs
  • Taxes
  • Freight
  • Payments
  • Orders
  • Quotes
  • Deliveries
  • Returns
  • Security

I’ll also address how to decide which integration strategy is right for you and your business challenges.  After all, launching a dozen products to a B2C channel in a defined territory where you only expect a handful of orders per day is a vastly different challenge from a worldwide B2B dealer channel that generates 500 orders per day.

Stay tuned for exciting things to come!

Sam

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