SAP country managing director upbeat over Pakistan's SME sector

Pakistan's managing director of software solutions company SAP, Saquib Ahmad, has said the small and medium enterprises (SME) sector possesses immense potential, which is evident from the fact that the country's enterprise saw a growth of an average of 30% during the last five years.

“We declared Pakistan as a growth market in 2017 and have expanded our operations by a significant margin since then,” Ahmad told Business Recorder in an exclusive interview.

Germany-based SAP is one of the world’s leading producers of enterprise resource planning (ERP) software and develops solutions that facilitate effective data processing and information flow across organisations.

Founded in 1972, the company was initially called System Analysis Program Development, later abbreviated to SAP. Since then, it has grown from a small, five-person endeavor to a multinational enterprise headquartered in Walldorf, Germany, with more than 105,000 employees worldwide.

In Pakistan, it has around 15 partners, which have between 100 to 300 employees dedicated to providing SAP ERP services to clients.

Interview with Saquib Ahmad, Managing Director, SAP Pakistan

Ahmad said the Ministry of Finance, Auditor General of Pakistan (AGP), NTDC, Pakistan Railway, OGDCL, PSO and Parco are some of the clients from the country's public sector that utilise solutions from SAP.

From the private sector, Honda Atlas, Indus Motor Company, Kia, Pak Suzuki Motors, Regal Motors, National Foods, Ismail Industries, LUMS, Iqra University, Engro, and K-Electric use its solutions, he said.

Ahmad said Imtiaz Stores, a chain of hypermart outlets, is also among the users of SAP software.

“To what extent a company uses our solutions varies from entity to entity,” he said. “Some firms have 100% operations on SAP while others use it for specific purposes.”

Ahmad expected growth to continue, adding that this stems from the confidence that the SME sector's run will remain sustainable.

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“Entrepreneurs in the SME sector are exceptionally smart and they know what their customers need. Therefore, they are well aware of what they need from us,” Ahmad said.

SAP is banking on the entrepreneurship capabilities in Pakistan that helped the company post impressive growth during the last five years, he said.

He stressed that SAP’s ERP software had a dominant market share of nearly 70% in Pakistan.

Ahmad, however, did not disclose if SAP Pakistan was making a profit. Oracle and Microsoft are SAP’s competitors in the ERP segment.

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SAP identified Pakistan as a high-growth market in 2017 and appointed Ahmad to overlook operations in the country. The Covid-19 pandemic proved to be a blessing in disguise for the firm and it saw nearly 35% growth.

A huge amount of demand during this period came from the SME sector.

He said that even eateries and retail outlets have been using SAP to bring efficiency to their system and growth.

“SAP certainly helps these SMEs expand quickly in a methodical manner,” Ahmad said. “We can help them anticipate which area or branch has more potential for higher sales so that they may divert focus to those areas.”

Ahmad said the SME businesses have realised after the pandemic that digitisation is important for the long haul.

"Priorities for every industry change with time and investors pour money more cautiously when an economy is going through a struggling phase, which is happening in Pakistan at the moment," he added.