Stop letting big ERP vendors dictate your spending: CTO

Rimini Street external CTO Eric Helmer recently visited Australia as part of the company's closed door "Street Smart" gatherings for its customer community. "We bring customers in person to talk about these issues. It's an opportunity to bounce ideas off your peers about what to do with these pressures and what others are doing. It's a safe space where we talk about what's working, what's not working, the tactics vendors are using, and what works to push back."

"I host a lot of these events, bringing folk together," he said. "With over 5,000 customers we'd be remiss to not create a community of customers, even non-customers, who are passionate and looking for help in an agnostic way, not being forced down paths they don't want to go."

In his daily role, Helmer is charged with "helping customers with long-term roadmap and strategy around enterprise software." This covers the gamut of ERP products and back office enterprise ysstems from the likes of Microsoft, WorkDay, Salesforce, Oracle, and others. "It's a very complicated world," he said, made even more complex today "with the backdrop of wars, pandemics, rising inflation rates, cybersecurity nightmares, and difficulty finding talent coupled with vendors forcing customers to re-implement their on-premises perpetual OEM customised licensed software, by abandoning it and re-implementing it into their subscription model so the customer gets less functionality than they staeted with."

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"It's very difficult for customers when vendors have a strict end-of-life. If you're not off the on-prem platform and into the subscription model by such-and-such a date, your installation is no longer supported."

There's a better way, and there are options, Helmer said. "People need help, advice, and guidance for an agnostic way that doesn't force them but shows they have options. Rimini Street gives all the different options to modernise their use of the ERP over the next seven or more years and help with all the data points to make the best decision."

"Sometimes you only get advice from the vendors who want to re-sell the same product, but people are looking for counterpoints and different ways of looking at it."

These are real situations, Helmer said. He's had people come to him who invested their last 15 years in an on-premises ERP license. They were told it was the most customisable, most extensible package you could get. They've customised it all over the place with unique business logic.

"Then, all of a sudden they got a knock on the door and told these assets are worthless; they must be thrown in the trash. The customer has to re-implement. Not ugprade, not migrate, but re-implement as a SaaS option, and in most of these models they can't bring their customisations or IP and it's all cookie-cutter."

"People are forced to try and figure out how it makes sense to move from being a homeowner who can remodel, to living in a rented apartment where all units look the same," he said. "And, when you are a tenant, the landlord controls the costs so you always know it will be out of control when renewing the lease."

If this situation sounds horrifyingly famliar, then Helmer has your back. One very topical recent example is Broadcom. "Broadcom is no longer handling perpetual licenses; you have to move to a subscription at 10 to 15 times the cost," he said. "IT leaders are in a difficult situation. They're flabbergasted. Our phones are ringing off the hook from people who want to take back control and are sick of vendors forcing them follow the vendor's dictated roadmap and to re-implement, re-platform, over and over to get the same functionality back."

"Enough is enough," Helmer said. "If you want a different path forward, then Rimini Street has a great liberation program."

Now, there are two major parts to the program. Firstly, Rimini Street offers guaranteed support for your existing enterprise products, as-is, for years and years and years. You might eventually choose to proceed with your ERP vendor's path, but you might also choose to go another way. Rimini Street says it gives you this optionality, and importantly, can buy you time to make your decision when it suits you.

However, the second part is the opportunity this offers you. Today, organisations worldwide of all types are curious about the potential of artificial intelligence. They're implementing, or planning to implement. They're wanting to justify a return on investment (RoI) to their boards. "Give me money to invest in AI," Helmer said, "but it's hard to quantify what it will do for us."

This is different to the traditional IT project where leaders say 'give me this much money and I will return this RoI in the next three years'.

"AI is harder to quantify investment, but people are definitely talking about it, and in my world we work on figuring out how AI intersects with ERPs specifically."

Helmer's advice is to start with a business case. "Every organisations has hundreds of vendors, and every one of them is saying 'upgrade to our latest version to have AI' so some people think just upgrade everything and you're an AI company," he said. "But it's their AI. You didn't ask for it or design it, or submit your business requirements. You get what they give, and you might use it you might not."

"Don't go and get AI capabilities from someone else and try to retrofit it into some business case."

"We suggest you flip it," Helmer said. "Define the business case upfront, and agnostically find the right AI vendor to get the best outcomes."

In fact, "that's how we started our AI journey ourselves," he said. "At Rimini Street our use case was to understand and improve our profitability by customer, ticket type, and all sorts of different slices/dices."

Many organisations realise they have data everywhere, encompassing HR, time and attendance, contract management, ticket systems, and more. "You can't really answer questions and perform analytics without consolidating data centrally. That's where we started our journey."

Rimini Street picked Snowflake as its repository for consolidated data, but, like everyone else, found they had messy data. "We never had to make it so clean in the past as we did now for the robots," Helmer said. But, the company started small, set policies and governance, and progressively moved on its journey to predictive analytics and decision support.

And, of course, AI in a business will also need ERP data. "Our take is to think of AI as an external, separate thing outside the ERP. It will need the ERP data, but like our situation, it will need data from many other things."

Ultimately, Helmer's take is "the significance and importance of the ERP is the data it contains. Full stop."

And, if you come to that conclusion, then the version of that ERP becomes irrelevant. "The ERP is no more than a data point," he said. "So come up with your use case, clean your data, and fund an AI program to give business outcomes in the most cost-effective way."

All well and good to say, but "the biggest problem is nobody's getting any more money to do it," Helmer said. "IT leaders are expected to do it all, but with no more time, no more people, no more money."

"Not only do they have to be innovative but have to find the money."

The answer is obvious, in Helmer's mind. "You have to retool your brain from the traditional approach where the ERP is the centre of the world and everything revolves around it, to new thinking around data integration and data orchestration and getting everything ready for the robots. This is now the centre of the universe."

This happens by minimising the time, money, and resources in the ERP together. "IT leaders need to get it off their plate, even outsource it, to focus on the new way forward."

Here comes Rimini Street; "we can minimise your risks, and minimise the costs of vendor support with the massive amount of money they charge. We can offer a better way for people to get it off their plate at a fraction of the cost, even 50% to 90% off the vendor supplied support list price."

"When someone gives us a high priority ticket we have an engineer logging in within an average of 90 seconds - not just reading documentation, but 24x7 support in almost any language. And that's support for the whole product including tax, legislation, and so on. Even vendors don't support all that," he said.

"That's what we do. We take commodity systems off people's hands. ERPs are mission criticial, but they're not strategic. They close the books, pay people, create purchase orders. They run the business but they're not rocket science."

"You can reallocate your budget to deal with emerging tech," Helmer said.

If you're still not convinced, Helmer has a tip that can help.

"Go through your systems scientifically. A lot of new CIOs have to figure out what mess they've just inherited. They have to catalogue a lot of their systems. Take all the systems you have and put them in one of three buckets, in a spreadsheet."

That first bucket is for transactional systems of record. These are systems that run the business. They're mission critical; you need them. They run the mechanics of the business.

Secondly, systems of differentiation. Are you using these systems in a way that gives an edge over competitors? Do they provide some kind of competitive edge that you have, and your competitors do not?

Thirdly, list your systems of innovation. "You might be trying all kinds of things, drinking pots of coffee, and failing 99 out of 100 trials. But if you hit one out of a hundred it could be a real game charger for you, even the industry. The payout could be huge."

Put all your systems into these three buckets, Helmer recommends, and add up the resources and money you're putting into each.

"How much do you think is spent in all these buckets? About 95% of the budget is on bucket one. Only 5% of systems and time and resources are spent on things that are differentiating and innovative to the company," he said.

Once this was acceptable. After all 'risk' has been a major concern for enterprises for many years. "Yet it's no longer acceptable," Helmer said. "Businesses are demanding fierce competition, and growth, and taking market share. CIOs need to start re-allocating the allocation."

"It won't happen overnight, but you can embark on digital transformation over three to seven years with incremental changing. Start reducing the time and resources on bucket one and keep measuring year over year. Maybe this year it's now 90% to 10%, then 80% to 20%, and so on."

This also turns IT into a profit centre; "by bringing RoI back into the business you're creating competitive advantages, not simply there to keep the lights on."

To be clear, Helmer said, "I love SAP, I love Oracle. I think they are world-class software."

"But," he added, "they don't have great support."

"Use the right company for the right thing," Helmer said. "We're disappointed in how they treat their customers. They were fantastic great companies but now they're forcing people to rebuy software all over again."

"Rimini Street is here to give options. It doesn't mean you can't upgrade later, but we can give wiggle room."

"Maybe the big ERPs will have conversion tools ot migrate over a weekend, but for them to expect a customer to do a full re-implementation simply to have the same stuff as today - well, we think that's completely unfair to expect from their customer base," Helmer said.