If anyone doubts that competition spurs change, let them sit down with Dennis Moore, general manager for emerging solutions at SAP, and talk about what SAP has on tap for 2007. As I see it, what’s coming out of SAP this year represents a sea change taking place across the software industry.

Last year under Moore’s leadership, SAP partnered with Microsoft to introduce Duet, an enterprise mashup of Office. With Duet, writing an e-mail to a customer brings up that customer’s data automatically, allowing you to update it right there; working on a budget in Excel, the budget is right there; revising a contract, the original sits before you. According to Moore, Duet is due for an update in the first half of this year. Version 1.5, Moore says, will introduce scalable business processes that hit all the touch points triggered by a single event, such as hiring a new employee or altering an order-to-cash process.

But that’s not all SAP has in store for 2007. Enterprise Search, which the company will also introduce in the first half of the year, looks to me to be one of the more interesting products of 2007. As you know, most search products focus on text. If you’re looking for news, reviews, or an esoteric piece of information about an obscure author, Google is the way to go. But what if you want to know the status of a customer shipment, how much inventory is left, who is so-and-so’s supervisor, or whether I am authorized to give him or her a raise? These are the kinds of questions Enterprise Search is built to answer.

What’s more, if you search for a particular customer, Enterprise Search will also check out Dun & Bradstreet or Hoover’s for additional information. And it can be connected to non-SAP systems such as Siebel and PeopleSoft — “and other Oracle companies,” Moore says with a smile.

To do this, Enterprise Search comes with pre-built connections to SAP systems, and its Web service connectors can be used to hook it up to any other system. The search itself works by finding business-object matches. For example, if I’m looking for a customer whose company name has Palo Alto in it, Enterprise Search won’t bring up irrelevant customers just because they have the words Palo or Alto buried somewhere in their documentation. Best of all, Enterprise Search works from any browser.

SAP is also seeding the development community with a toolkit to build what you might call it applets, widgets, or gadgets, ala Microsoft Vista, for SAP. The company is also building its own gadgets that give you an alert box for, say, an RSS reader that tracks business events rather than news or blogs. That way, a sales manager can monitor when a sales rep closes a deal, for example. There are also alerts for corporate KPIs (key performance indicators), as well as alerts for tracking workflow queues, such as notifying a purchasing manager of requisitions waiting for approval.

Sounds like a dashboard, but these applets embody more of a Web 2.0 approach — they’re updated over the Internet, you don’t have to install anything, they’re more dynamic than what you get with a dashboard, and you get to pick the ones you want.

If you’re a financial analyst, a budget analyst, a PR rep — anyone who has to make decisions — this approach is all about how you work. And though I find it tinged with a bit of irony coming from someone at SAP, I do wholeheartedly agree with Moore when he says, “Frankly, either you know how to use it without training, or you are not interested.”

If that isn’t an indication that competition spurs change, I don’t know what is.