There is a problem with the SM_OBS_DLL folder in the temp folder of the Client Machine (either an upgrade or the user has run window disk cleanup). Do the following to solve the problem:
- In windows, go to Start > Run
- Type in %temp%. and press OK
- In the window that appears locate the SM_OBS_DLL folder and rename it to oldSM_OBS_DLL
- Restart SAP Business One
See SAP Note 863568 for more information. The error comes from the DI-API, so if it's persistent, please contact SAP support.