Our seminar was presented by Mike Hardy and held on 29th January 2015. The main points are summarised below:-
- Before buying products, check whether you really need then, it may be possible to squeeze more out of existing systems.
- Upgrading can be most cost effective than buying new.
- Where multiple systems are communicating with each other, consolidation may save you money.
- Get an experienced database administrator to defrag and check databases for faults regularly.
- When Oracle discontinues support for old products, do not leave the changeover until the last minute.
- Understand Oracle’s strategy so that you can pick the best times to buy, such as at year end (Oracle year end – 31 May, SAP year end – 31 December)
According to a recent Forrester Research report, SAP does more than 40% of its licensing business in the last quarter of the year.
Whether your company is large or small, software vendor negotiations are important to ensure you are getting the best deal for your money. Midmarket organisations may have a smaller voice, but that doesn’t mean that voice isn’t heard.
Big software vendors are willing to listen. Take the time to understand your contract and your relationship with them, as well as any changing business needs. This can lead to contractual concessions and built-in protection against future problems.
When SAP announced in the fall of 2008, maintenance fee increases that would raise costs by about 30%, user groups worldwide organised a response and caused SAP to reconsider the new policy.
With Oracle you need to look for contract loopholes. Make sure to build details into your contract specifying what will happen if Oracle acquires another company or if your Oracle product gets superseded by a company just acquired.
Show how your business and technology strategy ties in with Oracle and lay out your long-term plan for your Oracle representative to see.
For all of the vendors, show how your long term strategy will align with their’s – this will prove that the short term concessions will be outweighed by having you as a customer for some time.
Consider “discount licensing” with the potential to buy pre-owned licenses (following European Court of Justice Ruling 2012).
Network and talk to other (non-competitive) SAP/Oracle customers on their recent experiences, try to gather recent discoveries or conclusions. UK Oracle User Group (UKOUG), www.sapusers.org.
Customers should limit enterprise deals to what your company can actually consume.
Customers secure some “protection” in case the vendor alters its product direction. They can find that they now own worthless package licenses for products that were now obsolete because the vendor had replaced them with new developments or acquisitions. For example many companies that included SAP’s XI integration solution in their enterprise deal had to hand over more money to get its successor, PI.
You want an account manager focused on ensuring your success and solving problems, not searching for new revenue opportunities – so make it part of the deal that the vendor reflects aspects such as product adoption in the account team’s compensation.
Salespeople are used to customers threatening to leave their company for another vendor, but such tactics only work if they are not an actual bluff.
Alternatives to Oracle & SAP:
ERP – MS, JDA, Epicor, IFS, IBM, Infor etc plus …… Open Source