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CN Partners With SAP to Enhance Customer Service and Control Costs


May 18, 2006

Four-Year Project to Improve Management of the Transportation Supply Chain

ORLANDO, Fla. and TORONTO - CN, a leader in the North American rail industry, and SAP Canada, the Canadian subsidiary of the leading global business software company, today announced a joint information technology (IT) partnership to further improve CN efficiency and enable the company to improve its transportation supply chain.

The four-year agreement includes more than 30 comprehensive projects targeting CN’s assets and operations, enhancing the company’s ability to improve customer service, asset utilization, cost control, safety and employee management.

Today’s announcement builds on a longstanding relationship between CN and SAP to enhance back-office functions, expanding to include CN’s track and roadway engineering, logistics, revenue enhancement and customer management functions. Under the new agreement, CN will implement mobile business solutions from SAP for track maintenance, dock operations and order-to-cash processes to optimize CN’s operations.

CN will work with SAP to introduce Transportation Management Connectivity, representing a first in the international rail industry. Through this initiative, CN, using SAP technologies, will eventually be able to take advantage of seamless communication and connectivity to integrate its services into customers’ transportation supply chains.

As part of the agreement, SAP will deliver the IT solutions required to maximize performance in the following four key areas:

* mobile applications for inspection and maintenance of network assets;
* optimizing revenue and customer management processes;
* integrating and enabling CN’s diverse transportation logistics services; and
* standardizing internal IT functions such as employee portals

As part of the partnership, CN and SAP Canada will jointly pursue a variety of initiatives to promote SAP® technologies across the rail industry and to share best practices with industry players in Canada and around the world. In addition, SAP will work closely with CN to ensure that all future industry-specific solutions address industry needs and incorporate CN recommendations.

“To date, CN has integrated and consolidated the functionality and data from over 100 computer applications into one seamless SAP platform,” says Fred Grigsby, CN’s senior vice-president and chief information officer. “In addition to improving numerous key business processes, this consolidation has enhanced management decision-making by providing CN managers with quick, efficient access to integrated, real-time data.

“We are extremely pleased that CN and SAP have reached this unique partnership. It enables us to further leverage our SAP investment and meet the accelerating needs of our business and our customers while allowing SAP to expand its reach and add value across the rail industry,” added Grigsby.

The deployment of SAP NetWeaver®, SAP’s comprehensive integration and applications platform, will be a key element of the implementation. Using SAP NetWeaver, CN will unify integration technologies to enable and manage change effectively while minimizing risk to existing systems and helping foster a strong return on investment. CN will be deploying SAP applications including:

* mySAP™ CRM (mySAP Customer Relationship Management)
* mySAP™ SRM (mySAP SRM Supplier Relationship Management)
* mySAP™ PLM (mySAP Product Lifecycle Management)
* SAP® Advanced Planning & Optimization (SAP APO)

“We are proud that CN recognizes our contributions to its improvements in revenue-generation, productivity and profitability, and has chosen SAP to assist the company in implementing its strategy for strong, sustainable growth,” said Bob Courteau, president and managing director, SAP Canada. “This expanded relationship and the collaborative approach we have adopted demonstrates our commitment to devoting SAP’s extensive resources and expertise to optimize CN’s business processes to support the company’s long-term success.”

CN and SAP started working together in 1998, when CN first implemented various SAP solutions to power a number of back-office functions—including finance, supply management, human resources and payroll—and to manage fixed and mobile assets such as locomotives and railcars.

About CN
Canadian National Railway Company spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key cities of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America.

About SAP for Railways
The SAP for Railways solution portfolio supports and enhances the complex business processes in freight and passenger transportation, infrastructure investment and rolling-stock maintenance. With more than 50 customers worldwide, SAP for Railways helps rail organizations reduce costs, optimize asset life cycles, measure and control projects, streamline administrative processes and enhance services.

About SAP Canada
SAP Canada, based in Toronto, is a fast-growing subsidiary of SAP AG, the world’s leading provider of business software. SAP applications are helping Canadian enterprises improve productivity and customer relationships, reduce costs, increase revenues and profitability, and create efficiencies across supply chains and business operations. SAP Canada has more than 600 customers and 800 employees in five offices across the country. In addition, SAP Labs Canada develops cutting-edge software for a wide array of SAP applications from its Montreal location.

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About SAP AG
SAP is the world’s leading provider of business software*. Today, more than 33,200 customers in more than 120 countries run SAP® applications—from distinct solutions addressing the needs of small and midsize enterprises to suite offerings for global organizations. Powered by the SAP NetWeaver® platform to drive innovation and enable business change, SAP software helps enterprises of all sizes around the world improve customer relationships, enhance partner collaboration and create efficiencies across their supply chains and business operations. SAP solution portfolios support the unique business processes of more than 25 industries, including high tech, retail, financial services, healthcare and the public sector. With subsidiaries in more than 50 countries, the company is listed on several exchanges, including the Frankfurt stock exchange and NYSE under the symbol “SAP.” (Additional information at

(*) SAP defines business software as comprising enterprise resource planning and related applications such as supply chain management, customer relationship management, product life-cycle management and supplier relationship management.

Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should” and “will” and similar expressions as they relate to SAP are intended to identify such forward-looking statements. SAP undertakes no obligation to publicly update or revise any forward-looking statements. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations The factors that could affect SAP’s future financial results are discussed more fully in SAP’s filings with the U.S. Securities and Exchange Commission (“SEC”), including SAP’s most recent Annual Report on Form 20-F filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.

Copyright © 2006 SAP AG. All rights reserved.
SAP, R/3, mySAP,, xApps, xApp, SAP NetWeaver and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP AG in Germany and in several other countries all over the world. All other product and service names mentioned are the trademarks of their respective companies. Data contained in this document serve informational purposes only. National product specifications may vary.


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