IBS Journal July – August 2015
SAP signs to resell Calypso’s treasury and capital markets system
accomplish that without the complexi- ty of consolidation within the industry.’ SAP’s senior director, industry mar-
keting, Andy Hirst, says that, having identified a gap in its offerings, SAP looked at whether to buy, build or part- ner. It has its own SAP Treasury solu- tion, which is widely used in the cor- porate sector and has around 40 banks as users, including some central banks, but this does not stretch to more com- plex instruments. The white labelled Calypso system will now become SAP’s main offering for banks. If an exist- ing SAP Treasury bank user outgrows the offering, then it might be offered Calypso but there will not be any pres- sure on users to move. The first focus for SAP will be on
developing markets, particularly Lat- in America and the Middle East, where Calypso has only limited reach. SAP has 1500 staff in the Middle East, for instance, and has had good uptake of its core banking and lending systems in Latin America, where it also has plen- ty of resources. At the same time, Hirst admits that it has limited expertise in the TCM sector at present, with perhaps ten experts around the globe, but these will be able to qualify leads and will then work with Calypso’s teams to do joint sales. In Latin America and the Mid- dle East, SAP will probably lead, he says; elsewhere, it might be the other way round. Despite the initial geographical focus, there are already discussions with prospects in North America, he adds. In Western Europe, its first port of call will be its existing customers. SAP will sell, maintain and support
the Calypso system; it will work with Calypso’s existing partners for deliv- ery. The main discussions to date have been with Accenture for developed markets and TCS for developing ones. There is a good pipeline, says Hirst. There are already a couple of opportu- nities at existing SAP customers, where there is unlikely to be an RFP process; there is already a joint proposal in
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moved to Misys as president and head of global sales. Around 60 per cent of Calypso
Andy Hirst, SAP
users have Oracle for the database, with around 30 per cent on SAP’s Syb- ase. However, most of the latter are relatively early takers. SAP will seek to reverse this trend. It would sell an Ora- cle version if this was a strong prefer- ence of the customer, says Hirst, but the main emphasis will be on the Syb- ase-derived Adaptive Server Enterprise (ASE) database. The white-labelled Calypso systems will appear on SAP’s price list and there will be work to improve integration with SAP components. Calypso’s limit man- agement component might interface to SAP’s Bank Analyzer, for instance, and there might be similar synergy between the companies’ two collateral manage- ment components or for Calypso to feed SAP’s payments engine. There is no commitment at present for Calypso to utilise SAP’s HANA in-memory platform but this might follow. In terms of any other gaps that
Charles Marston, Calypso
response to another RFP where pre- viously SAP would have bid with its own treasury system but ‘with cave- ats’ about its ability to meet all of the requirements. It is clear that SAP also took some
time talking to Murex and Misys, among others. It has technology-based relationships with both. There are at least 30 joint customers with Murex, says Hirst, but this supplier wanted to remain more independent, so the rela- tionship will remain a technology one. There is a certain irony in the Misys deliberations, in that SAP previous- ly had a briefly much touted partner- ship with this supplier but it came to nothing. Moreover, SAP’s TCM strategy was started by former head of financial services, Simon Paris, who has recently
SAP might seek to fill in its product suite, Hirst cites trade and market surveillance. As in the TCM space, it is likely that SAP will partner rather than acquire, with the current corpo- rate strategy being to halt acquisitions for the time-being while it integrates recent ones in the B2B space. SAP bought Concur and Field Glass, which are felt to fit well with its previous B2B acquisition, Ariba. Whether it can offer the Calypso
system on a cloud basis is a moot point. Calypso itself has been talking up the potential for utilities in the TCM sector while SAP, as with all of its competitors, has been investing heavily in cloud, albeit with underwhelming results to date. Indeed, the under performance of its cloud activities is widely believed to be one reason for current cutbacks, whereby it is offering voluntary redun- dancy to staff with more than ten years of service.
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© IBS Intelligence 2015
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