SAP, the largest enterprise applications vendor, and Microsoft, the largest overall software vendor, have agreed to integrate key products through a joint development partnership. Mendocino, code name for a product that the two companies will create, adds data and process context from the mySAP enterprise applications to Microsoft Outlook, Excel, and other Office applications. This is Microsoft’s most strategic partnership since it created MS-DOS and OS/2 with IBM, and it promises to dramatically improve the user experience and reach for SAP’s applications. But the deal also requires the two companies to align schedules, software reliability, and business models to an unprecedented degree. Mendocino will spark a chain reaction of partnerships among other enterprise application and collaboration vendors, speeding up the arrival of information workplaces.

[Via Recent Research from Forrester]