SAP Business ByDesign is a midmarket product that most closely resembles NetSuite in terms of system architecture and the businesses it serves, but it is no longer a product SAP is actively investing in or developing. Effective April 2023, new development for ByDesign will be limited to critical security and legally required updates, with SAP no longer producing new functionality. It’s the beginning of the end for a product with a checkered history.
After investing several billion dollars to develop it, SAP released ByDesign in 2007, but customers soon had major problems, and SAP pulled it off the market just a year later. The vendor halted development of the system again in 2013 before reintroducing it in 2014, but it never took off — today there are believed to be less than 3,000 ByDesign customers, amounting to less than 10% of NetSuite’s customer base. Most of these businesses are in the services space, and SAP will probably push many of them to S/4HANA Public Cloud, which requires a full implementation.
Functional Considerations
Moving forward, new functionality for ByDesign will be available only through extensions developed with SAP’s Business Technology Platform and predominantly by SAP partners. Product servicing will largely fall on Indian IT service provider HCLTech, per German newspaper Handelsblatt. These steps are indicative of SAP’s lack of commitment to ByDesign and the limited future it sees for the product.
ByDesign’s accounting and finance features lack the breadth and depth of NetSuite. The solution has no native financial consolidation and limited revenue recognition capabilities that struggle to satisfy multiple standards like GAAP and IFRS. ByDesign does include an integration with Microsoft Excel, which many finance and accounting professionals like, but most businesses are trying to move away from spreadsheets when they invest in an ERP system.
With limited budgeting capabilities, many businesses will need an SAP Business Planning and Consolidation (BPC) license for financial planning and budgeting. Business Planning and Consolidation is a complex system that will likely require the help of a specialized partner that understands the system, adding extra cost.
NetSuite has best-in-class accounting capabilities and financial consolidation in the base product. Its revenue management module can automate revenue recognition based on user-configured rules and in accordance with various standards. In addition, NetSuite Planning and Budgeting (NSPB) pulls in data from your ERP, making it much faster and easier to create top-down or bottom-up budgets and forecasts.
Database and Architecture Considerations
Unlike other SAP products, ByDesign has always been a SaaS product built for the cloud, like NetSuite. That means customers received automatic updates and are all on the same version of the software. SAP hosts the solution in its own data centers.
Customers previously received quarterly updates, though that’s likely no longer the case since it’s now in maintenance mode. There is no published upgrade path for the core product, raising concerns about implementing partner add-ons and falling behind on functionality.
Platform and Integration Capabilities
Companies that want to link ByDesign to non-SAP systems will likely need to purchase the SAP Integration Suite middleware. There is a basic edition and standard edition of the SAP Integration Suite, with the standard edition giving customers additional features but also carrying a much higher price tag. This is yet another product partners will charge to configure and integrate with your ERP system.
Building connections to any other applications, whether from SAP or another vendor, will require the assistance of a partner. For instance, organizations that want HCM will need SAP SuccessFactors, a robust but expensive solution designed for large companies. Some applications may even require you to engage a second partner with more specialized knowledge.
Configurations and Customizations
Broadly speaking, ByDesign cannot match the flexibility of NetSuite. Business processes are standardized, and changing them is not easy, so you’ll need to pay for consulting hours from a partner. There is also the issue that different partners will develop add-ons and customizations in different ways, making it challenging for other partners to assist with those. That’s a problem if your partner stops supporting ByDesign, shuts down, or you want to change partners. Conversely, NetSuite has been designed to empower administrators and business users to tailor the system to their needs.
ByDesign has a nonvisual Workflow Rules tool, but it has limited capabilities. Workflows can only be triggered by user actions and cannot be time-based. NetSuite SuiteFlow is a visual tool your staff can use to build all sorts of business processes by dragging and dropping items. SuiteFlow works across modules so companies can automate tasks across roles and departments.