Check Jon's latest diginomica blog!

Here's Jon's diginomica blog updates
Read Ultimate SAP User Guide kindle reviews  

Advertisement
Advertisement
Advertisement

JonERP.com Podcast Feedback

"I listen to all your SAP podcasts in my car, until my kids get mad at me and make me put on music for them instead. Keep up the good work!"

- Robert Max, 2007 Solution Manager Community of Interest, and Systems Management Special Interest Group Chair for the Americas' SAP Users Group -

JonERP.com Visitor Feedback

"Jon, let me congratulate you on building a site which exclusively caters to SAP skills and careers and answers a lot of doubts young and senior SAP consultants have about what skills to have and get trained on."

More JonERP.com Site Feedback

"I have been reading your SAP newsletters for over a decade now... It's remarkable that you have now embraced the Web 2.0 delivery methods - Podcasts, Twitter etc - without sacrificing the in-depth nature of your analyses!" - Dave Sen, SAP Enterprise Architect -

JonERP.com Reader Feedback

"I visit JonERP.com almost everyday to check out whether there is something new and what the future trends hold for SAP skills and careers."

More JonERP.com Site Feedback

"I was struggling with career direction a few years ago and you provided me with some extremely valuable advise. I've been very satisfied with my career direction which was influenced in large part by your coaching. Thanks again!" - Keith

New JonERP Feedback

"You have always been there with a prompt reply when it matters the most. You have really been a mentor in true sense."

- Hussain Sehorewala -


What's Jon's Take on SAP Trends in 2015?

jonerpdemojam.jpg Jon has been tackling key SAP issues (like SAP certification and HANA) since 1995. Get the latest from his blogs, YouTube channel, and iTunes feed.

Or, follow his opinionated views real-time on his JonERP Twitter Feed. Jon served as SAP Mentor from 2008 to April, 2015. 

Jon is a co-founder and award winning blogger at diginomica.com

Jon is also an Enterprise Irregular, a select group of enterprise bloggers/practitioners. Follow his content from all sites (including diginomica) via the JonERP feedburner feed (or email). Jon is also a board member of the HANA Distinguished Engineers.

Here's how Jon pays the rent.

Also: connect to Jon on LinkedIn, and join his LinkedIn "SAP Consulting Skills" Group. JonERP is on Facebook also, and he posts on Google Plus - "circle" him there if you like.

Track Jon's (in)famous "JonERP Newsfeed" via Twitter, Facebook, RSS, or email

News: Jon + 4 co-conspirators launched diginomica - insights for the digital enterprise

Which SAP Industry Solution is the Hottest? A JonERP.com Exclusive Print E-mail

jonerp_full_logo.PNGWhich SAP Industry Solution is the Hottest?
A Ranked List by Jon Reed of JonERP.com
Published: January 2009


Ranking the consulting demand for SAP's Industry Solutions is not an easy task. As we consider SAP industry skills, we must take into account that SAP has not only expanded its Industry Solutions, but its own industry listings have gotten pretty complicated. I'm giving this a shot because the topic is more relevant than ever - today's SAP consultant is more likely to find success if they have some level of industry specialization.

Another problem with this exercise: we must distinguish between the ERP demand in a particular industry and SAP's configurable industry functionality, which might not have been embraced, even in an industry where SAP has a number of customers. I'll explain this distinction further in a moment. 

With these challenges in mind, I am going to proceed with the goal of ranking SAP's industry solutions in terms of their skills demand. Before we move ahead, it's also a good idea to read through my general disclaimer about the limitations of hot skills lists. It's also important to remember that there are two aspects to SAP industry know-how. One aspect is the general knowledge of the best practices of a particular industry. The second is having actual project experience configuring SAP's industry solution for a particular industry.

In today's SAP consulting market, both aspects of this skill set have relevance. Having industry-specific SAP experience has value, and so does the ability to configure SAP industry solutions. The two often overlap nicely, but not always. Take for example the pharmaceutical industry. SAP itself has done well in the pharma industry, with a number of successful installs. If you have experience working on multiple SAP projects in the pharma vertical, that's pretty good experience to have. However, SAP's Industry Solution for pharma, now classified in the "Life Sciences" area, has struggled to gain traction and is only now picking up some momentum. The reason? The intense regulatory environment of the pharma industry has always given best-of-breed solutions a big edge over SAP and other ERP vendors.

We must also take into account that there is usually a relationship between the success of an SAP Industry Solution and the health of a particular industry. Exhibit A: SAP's Automotive Industry Solution is struggling, but we can't blame that on SAP. It's the overall issues in that industry that are hurting the demand for that solution knowledge.

In a recent feature article in this month's B2B Workforce Consultant Newsletter, I wrote a piece on industry-specific ERP consulting. Brian Trout, National Sales Executive for B2B Workforce, shared a methodology for how to select a worthwhile industry focus. We also noted the value of acquiring industry-specific ERP skills in terms of making sure your ERP skills are better "insulated" from a slower consulting market.

To paraphrase from Brian's suggested methodology for evaluating the viability of a particular industry for SAP consulting, we must consider:

1. The overall economic health of the industry.
2. The overall penetration of ERP software solutions in that industry.
3. The sophistication of SAP's Industry Solution for that industry.
4. The amount of unique business processes that require consultants to help optimize them. Remember that the more complex the business processes are, the more reliance there will be on consultants who truly understand the dynamics of a particular industry.

With that context in mind, I'm now going to classify most of SAP's main Industry Solutions into three categories, "hot," "warm," and "cold." I will include a definition of what constitutes hot or cold in each section. I'm going to leave a couple of industries out of this classification due to some overlap between how SAP classifies its Public Services and Manufacturing solutions that is too complicated to get into here, but most of SAP's Industry Solutions will be listed below, sometimes with an elaborating comment. I mentioned that SAP's Industry Solutions map has gotten pretty complex. I'm basing this analysis on SAP's latest industry map. If you take a look at that map, you'll get a better idea for what I was up against here.

Finally, it goes without saying that the economic downturn has put an overall damper on Industry Solutions activity in general. But some industries have been impacted more than others, and this may create an opening for opportunistic consultants. Oh, and since SAP has started to phase out the use of "IS" as an Industry Solution abbreviation, as in "IS-Oil," I'm not using the "IS" abbreviation in this piece.

"Hot" Industry Solutions
("Hot" means that these solutions have a good level of consulting demand and appear to be growth areas for the foreseeable future).

Retail - SAP took some hits with its retail solution in the early years, but SAP has persisted and the product has started to gain some real traction. The Apparel and Footwear solution has gained ground as well. True, SAP's Retail solution still lacks the sophistication to distinguish between finely-tuned products in warehouse settings, something that a best-of-breed product like PKMS can deliver on, but SAP Retail is still an up-and-coming area.

Wholesale Distribution - While there isn't a broad demand for SAP Wholesale Distribution skills, it has become a hot niche for a smaller group of consultants.

Aerospace and Defense - SAP's A&D solution is trending from hot to warm as it matures, but the combination of a relatively stable industry from an economic standpoint and deep SAP industry penetration and functionality has kept this Industry Solution in demand. We're seeing some connections here to make-to-engineer functionality, and SAP's abilities to manage a complex bill of materials. Also keep an eye out for related work pertaining to DMS (Document Management Systems) and PLM/CAD engineering work.

"Warm" Industry Solutions
("Warm" means that these solutions have some level of demand but not a huge amount, either because the amount of installs is still small, or the solution has matured and there are a good supply of senior consultants with experience available)

Utilities - Utilities is one of those rare areas that is trending hot, largely due to its recession-proof aspects. Also keep your eyes open for SAP's Utilities Customer Care and Service apps and SAP's Utilities Customer E-Services, both of which have been showing up on job orders lately.

Media - There are a surprising number of SAP installs using SAP's Media solution, and there are some complexities involving this solution that consultants are needed for. Tracking subscription sales, for example, might seem pretty straightforward but managing a sale that is applied over time, especially when discounts are invoked on a multi-year basis, can present some challenges. This is a narrow enough industry for SAP that it might not support a bunch of consultants, but those who have these skills, especially with some media industry background, might find a good niche here.

Higher Education and Research - Oracle has had a better year in this space than SAP, but SAP is still doing enough here to stay in the "warm" column.
Consumer Products - an SAP staple.
Mining - I rated this as "warm" but only as a specialty skill set for a small collection of consultants who have deeper expertise in this industry.
Life Sciences - SAP has pretty good market penetration in Life Sciences (which includes pharma), but best-of-breed solutions, such as LIMS systems, (Laboratory Information Management Systems), still have a deep foothold here.
Engineering, Construction and Operations
High Tech
Mill Products
Telecommunications

"Cold" Industry Solutions
("Cold" means that unless you have very deep skills in this industry you probably want to be working on a new area of focus)

Oil & Gas - SAP has some long time customers in this industry, but it's a mature market that favors the most senior consultants. If that's you, Oil & Gas might continue to bring good results. If not, greener pastures might be elsewhere.
Chemicals - SAP has had some customer success in the Chemicals arena but some of the industry-specific needs are still dominated by best-of-breed players.
Banking - Yes, SAP did score a big win in the banking industry with the Bank of America account. But we can't rank the banking industry any higher until the financial turmoil that hit the financial services hard has levelled off.
Professional Services -
SAP has never been as strong in services as it has been in manufacturing and consumer goods.
Industrial Machinery and Components
Travel and Logistics Services

Conclusion to SAP Industry Rankings

These groupings were not based on a scientific analysis, but on my own observations, market research, and interviews - all based on the current level of consulting demand we are seeing. Obviously any such lists should be taken with a grain of salt; there are undoubtedly SAP consultants succeeding in all the industries we have listed here.

In conclusion, there are a couple more points to note. Starting with ERP 6.0, SAP's Industry Solutions all ship with the core ERP product, but in the "lights off" position. You turn the solution on using SAP's Switch Framework, so I obviously recommend getting some exposure to this new tool.

Before I wrap this piece, I wanted to briefly touch on the value of SAP Industry Solutions expertise, something I alluded to in the introduction. In the piece I wrote for B2B Workforce, Brian Trout and I talked about the possibility of using SAP industry experience for skills insulation. As I put it:

"I find the concept of "ERP skills insulation" compelling because it reminds us that ERP consulting demand is not about one market in particular, but a number of smaller submarkets, each with their own supply and demand fluctuations. As Brian explains it, the key to skills insulation is breaking away from the ERP pack and finding that narrower niche. ‘No matter what the economy is like, when it comes to determining your market viability and how to maximize your rates as an ERP consultant, one key aspect is: do you have specific tools or skills, most of those industry-related, that get you into a smaller, narrower pool of the overall labor supply chain,' says Brian. ‘So, for example, if you're an Oracle or an SAP consultant, the more you have either niche tools and/or focused industry vertical skills, then the overall labor supply chain for your skills is narrowed down to a much smaller subset, which inherently provides you with more consistent demand in that industry vertical and consistently higher rates as your experience grows.'"

Hopefully gives you a better sense of where the action is in SAP in the industry verticals and how you might select an industry that matches your background and supports a decent level of consulting demand.

:
Tantra responded... (User IP:24.228.95.20)
01/14/2009 23:52:01
IS Utilities
Jon,
A good article...quite helpful.

I have one question on IS utilities. In your rating its been categorized as one of the " Warm" Industry Solutions.

Is it due to amount of installs is still small, or is it due to the fact that the solution has matured and there are a good supply of senior consultants with experience available?
This information would be helpful to me as I am thinking to shift from my present skills of SAP SD/CS to IS-Utilities. Because if the installs are small then there is oppurtunity to grow but if the solution is matured with good consultants already available then there is no point going into it and I can think of some other IS solution.

Thanks, Tantra
Jon Reed responded... (User IP:71.192.32.131)
02/01/2009 14:40:48
IS -Utilities
Hi Tantra. Sorry for delay responding, I missed this comment somehow. Anyhow, Utilities is in the "warm" category because it is a pretty mature industry solution with a decent amount of consultants already working in that area. Plus, the growth opportunities in utilities, while decent, do not seem as uncharted as some other industries (like retail) where ERP is still looking for more of a foothold.

Having said that, I see no reason not to pursue utilities. It's certainly one of the better industry areas on SAP to consult in.

Good luck.

- Jon Reed -
Tantra responded... (User IP:24.228.95.20)
02/08/2009 13:53:27
IS Utilities
Hi Jon, Thanks for the reply. As I understand IS-U has got more number of installations in Europe but in the US its installation base is small (as per my info its only 25% of Europe). As IS-U is a matured solution, I am hoping it will catch on in the US with more utilities companies going in for SAP. This should create a good demand for IS-U consultants in the US for quite some time. What are your thoughts on this? as I am operate in the US market and would be more effected with the local demand here.

Thanks, Tantra
Muhammad responded... (User IP:203.127.162.194)
02/14/2009 06:10:40
SAP Retail in Asia in 2009
Jon
Will SAP Retail be warm in Asia as well compared to SD and MM?

Thanks , Muhammad


 
[b] [i] [u] [url] [quote] [code] [img] 
 

3.26 Copyright (C) 2008 Compojoom.com / Copyright (C) 2007 Alain Georgette / Copyright (C) 2006 Frantisek Hliva. All rights reserved."

 

JonERP Feature Interview

 
Browse Jon's YouTube SAP Videos
Read Ultimate SAP User Guide Reviews

What is Jon Up to Now?

Track Jon in real-time on Twitter
See his latest diginomica blogs

Get Jon's SAP Blog + Videocast Feed (or Email Notifications)

Jon's "Get All My SAP Content" RSS Feed

or Subscribe to the Feed by Email
Advertisement
Advertisement
Advertisement
Advertisement
Advertisement

The Latest JonERP Feedback

"I have referenced your articles on JonERP.com for my internal Fujitsu colleagues on how the functional skill set is changing. It's not just theory, but real life change and the need for new SAP skills."

- Ranjan Baghel, Associate Director, Fujitsu America -

JonERP.com Site Feedback

"I can't imagine any SAP professional who is serious about their career not utilizing the JonERP.com website. I know I used it frequently when I did SAP consulting. I use it even more now and I know my colleagues go there quite frequently to increase their knowledge of the SAP market, it is a source of great information."

- David Dawson, SAP Direct Hire Consultant, Acsys -

More JonERP.com Site Feedback

"Jon, you are definitely spot on with your analysis of the SAP market. I've been using your websites for over five years now. Instead of buying all the SAP books, I use your stuff to catch up with what's new in the ever-increasing SAP market." - Mark

JonERP.com Reader Feedback

"I've kept up with your JonERP.com site for a long time and your articles via SearchSAP.com and elsewhere. I just realized a few months ago that you were also the author of the first SAP Consulting book that I read when I decided to take the leap from working at a Utility company to becoming an SAP Consultant. The SAP Consultant Handbook is a staple for any SAP consultant, new or experienced. I just wanted to thank you for the quality work."

- J. Michael Peace, Independent SAP Consultant -