10 Digital Transformation Questions for CIOs, Digital Strategy Case Study with the US Army, Inside the ERP Software Cartel
Oct 4, 2023
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This podcast covers digital transformation questions for CIOs, a digital strategy case study with the US Army, and insights into the ERP software cartel. They also discuss the challenges of Oracle NetSuite, the importance of change management in digital transformation, and the reckless behavior of big software vendors. Other topics include the value of software upgrades, custom ERP systems, and the challenges faced by enterprise tech customers. They explore the future of ERP software, the evolution and limitations of ERP systems, and considerations for ERP system upgrades and digital transformation.
Remini Street provides cost-effective support for SAP and Oracle software, offering flexibility and breathing room for customers to make decisions on their own terms.
The ERP software cartel relies on forced upgrades and massive project implementations to generate revenue, creating a false sense of urgency and pressure on customers.
Remini Street addresses the challenges of cloud migration and digital transformation by offering long-term support options and strategic decision-making without being tied to vendors' timelines.
Considering third-party support can help customers fight back against forced upgrades, assess cost benefit and risk, and make informed decisions aligned with their goals.
When moving to the cloud, customers should evaluate the specific goals, potential benefits, compatibility with existing tech stacks, and stay informed about emerging technologies.
Deep dives
The Rise of Third-Party ERP Support Providers
Remini Street, an independent third-party support provider for SAP and Oracle software, offers an alternative to vendor support. They provide maintenance and support for a fraction of the cost, allowing customers to push back against the pressure to constantly upgrade and stay within the vendor's timeline. By guaranteeing support for up to 15 years for any version of the software, Remini Street gives customers flexibility and breathing room to make decisions on their own terms. The company supports customizations and provides expert assistance on interfaces, integrations, performance tuning, and other specific needs. This challenges the vendor's maintenance policy, which primarily supports the base code rather than customizations.
Challenges with Vendor Maintenance Policies
The ERP software cartel, consisting of major vendors like SAP and Oracle, relies on the revenue generated from customers' forced upgrades and massive project implementations. This creates a false sense of urgency and hype around constantly upgrading to access new features and functionalities. The vendors' maintenance policies also exacerbate the issue, with customers being forced to upgrade just to stay supported. These upgrades can be costly and may not always provide the expected value. Furthermore, the push toward cloud-based solutions adds complexity and pressure on customers to migrate, often causing chaos within the SAP community. Remini Street addresses these challenges by providing long-term, cost-effective support options and giving customers time and flexibility to make informed decisions without being tied to the vendor's timeline.
The Future of ERP Software and S/4HANA
The future of ERP software, particularly SAP's S/4HANA, is heavily influenced by the desire to move to the cloud and embrace digital transformation. Companies want to leverage new technologies like artificial intelligence and machine learning to stay competitive and drive innovation. However, the move to the cloud is complicated by the pressure from software vendors to upgrade and migrate to their cloud offerings, often leading to rip-and-replace scenarios for customizations. Remini Street provides support for various SAP ERP versions and offers solutions to address security, performance, and customization needs, allowing organizations to make strategic decisions about their ERP future without being dictated by the vendors' timelines or upgrade cycles.
Options for Enterprise Tech Buyers
Enterprise technology customers have the option to fight back against forced upgrades and challenges in the market. One option is to consider third-party support, like Remini Street, which provides ongoing support for legacy systems and extends the timeline for upgrades. This allows customers to be more targeted and deliberate in their approach, rather than feeling pressured to do a big, costly upgrade. Assessing the cost benefit and risk of different scenarios is crucial in making an informed decision.
Managing Risk and Prioritizing Goals
Customers should prioritize their goals and assess how an ERP migration aligns with achieving those goals. It is important to manage risk and minimize it by taking baby steps and not rushing into massive contracts or changes. Taking a wait-and-see approach can be helpful, allowing time for new technologies to mature and for successful case studies to emerge. By being mindful of ROI and value proposition, customers can make informed decisions that best serve their business.
Assessing Cloud Migration and Future Technologies
When considering a move to the cloud, customers should carefully evaluate what it means for their organization and what benefits it can bring. It is crucial to understand the specific goals and potential value that cloud adoption can deliver. Additionally, customers should stay informed about emerging technologies, such as AI and connectors, and assess their compatibility with existing tech stacks. By taking these factors into account, enterprise technology buyers can make more informed decisions and navigate the complexities of the market.
Advantages of Single ERP Systems
Single ERP systems provide unified data and integrate various functional elements into one platform. They offer consistent data and the ability to make informed decisions based on a single source of truth. Cloud-native applications also allow for regular upgrades and eliminate the need for bi-annual system upgrades.
Benefits of Best-of-Breed Interoperability
Best-of-breed solutions offer the opportunity to address specific needs that a single ERP system might not fulfill effectively. Organizations can select the best solution for each function, such as HCM, finance, supply chain, etc. Interoperability through modern technologies allows for seamless integration between these solutions and centralizes data for informed decision-making.
The Shift Towards Composable Platforms and Interoperability
The podcast discusses the trend of organizations moving towards composable platforms and interoperability rather than relying solely on traditional ERP systems. This shift allows organizations to leverage platforms like Salesforce and ServiceNow, which offer low-code and no-code capabilities for managing specific functions within the organization. These platforms enable organizations to configure their systems in a way that connects legacy and new systems, replacing the need for extensive software customization. The focus is on creating a connected ecosystem of tailored solutions that promote innovation and efficiency.
Challenges and Considerations in ERP Transformation
The discussion highlights the challenges and considerations organizations face when undertaking ERP transformation. The podcast emphasizes the importance of upfront planning, establishing a solid business case, and developing a comprehensive program management office (PMO). It stresses the need to carefully evaluate different paths, such as single ERP systems or a best-of-breed approach, weighing the benefits and downsides of each. Change management, data migration, and architecture are identified as critical factors for success. The podcast also addresses the impact of forced cloud migrations and the increasing need for experienced consultants, as organizations rush to implement new systems within a limited timeframe.
The Transformation Ground Control podcast covers a number of topics important to digital and business transformation. This episode covers the following topics and interviews:
10 Digital Transformation Questions for CIO’s, Q&A
Digital Strategy Case Study with the US Army
Inside the ERP Software Cartel (Sebastian Grady, Rimini Street)
We also cover a number of other relevant topics related to digital and business transformation throughout the show.
This weekly podcast series premiers live on YouTube every Wednesday at 8am New York/1pm London/9pm Hong Kong. You can also subscribe to the podcast on Apple, Google, Spotify, Pandora, or your favorite podcast platform.
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