Rimini Street made its SAP third-party maintenance and support services generally available last week and a pilot customer is giving the program a thumbs up.
"One of my largest expenses has been SAP maintenance," said Jeff Rishel, vice president of IT for Graham Packaging Co., a manufacturer of molded plastic bottles.
Graham Packaging was one of a select set of Las Vegas-based Rimini Street Inc.'s customers in the company's Charter Program for SAP maintenance. It now saves 50% in annual software support costs.
Maintenance and support costs for enterprise applications have garnered renewed attention in recent years thanks to a number of noteworthy developments. TomorrowNow, a company that offered third-party maintenance for Oracle, PeopleSoft and J.D. Edwards software and co-founded by Rimini Street President and CEO Seth Ravin, was acquired by SAP as the company sought to lure away PeopleSoft and Siebel customers following Oracle's acquisition of the two companies. TomorrowNow then became the subject of a lawsuit, with Oracle charging SAP with "corporate theft on a grand scale," causing SAP to shut down the TomorrowNow business.
Ultimately, SAP elected to eliminate Basic Support, its cheaper maintenance and support option, pushing customers to SAP Enterprise Support, effectively raising maintenance fees from 17% of license costs to 22%. Backlash from customers, particularly European user groups, convinced SAP to delay the program until it could prove its value, based on a set of agreed-upon KPIs.
Meanwhile, Rimini Street, which emerged out of the TomorrowNow events offering PeopleSoft, J.D. Edwards and Siebel third-party maintenance, extended its offering to SAP maintenance in May. That program is now generally available and Rimini Street is expanding its supported SAP product list. It now includes additional SAP Business Suite components BI7; SCM; CRM; EWM; PLM; and GTS. That complements Rimini Street's existing support for SAP R/3 4.X, ECC 5.0, ECC 6.0 and BW3.5 and earlier releases.
Early defector reviews SAP third-party maintenance and support
Graham Packaging, a York, Pa.-based manufacturer, had been running SAP for 11 years. Two months ago it signed on with Rimini Street while it was on one instance of SAP ECC 5.0, supporting 80 plants in 15 countries and about 1,800 users, Rishel said.
"We went on a mission to reduce maintenance costs with SAP," he explained. "We explored a number of options, one being third party."
The other options were limited. Graham Packaging, which had been on SAP's Basic Support product, approached SAP about cancelling some licenses or working out discounts -- without much success, Rishel said. Additionally, it approached other firms that were not offering SAP support services to see if they were interested in offering SAP but didn't get far. That left Rimini Street.
Graham Packaging has upgraded SAP a number of times, but the company uses the same general configuration it had when it started 11 years ago, Rishel said. The upgrades were undertaken primarily because SAP would not support older applications.
"I've been talking to SAP for the past five or six years saying, 'I'm paying a lot of money and I really don't use your support services much at all. Mainly because you have a good application,'" he said. "It's stable, it works, there are few problems. They're their own worst enemy in some respects because the doggone thing works."
Graham Packaging did have one support issue outstanding with SAP that it reserved for when the company elected to move to Rimini Street. It was having issues with transferring costs from the costs center to the profits center in the fixed assets module. SAP told Graham Packaging it may require an upgrade. Rimini Street, on the other hand, had a solution within a few days, Rishel said.
Graham Packaging has no intention of conducting another SAP upgrade anytime soon and is willing to maintain the current systems for three or four years, at which point it can decide whether it wants to continue with SAP or find another application, Rishel said.
For others looking to reduce maintenance costs, he suggests taking a close look at existing systems and future plans.
"Look at your situation," he said. "Are you in a stable environment? Is your company willing to take some time to invest in other options? Is your system in a state [where] you can stay this way for five or six years? If it is, I think you'll be satisfied [with third-party maintenance]."