Myths, Pitfalls and Realities Around Enterprise Software Support

MYTHS,
PITFALLS
AND
REALITIES
Around Enterprise Software Support
A Buyer’s Guide

2Rimini Street
Executive Summary
Enterprise software is complicated and also mission-critical. You run your
financials, sales, production, human resources and more on it. In some
cases having your system down can bring your company to its knees and
cost millions of dollars per hour! So quality professional support is vital.
Traditionally the major ERP/CRM vendors, Oracle® and SAP®, have simply
tacked on support and maintenance as a percentage of your license
costs. With these fees the vendor has promised to deliver fixes, patches,
certifications and upgrades. But are they delivering on that promise?
Increasingly, companies are now closely examining this enterprise
software support model, considering value and ROI, and considering
alternatives for their applications, databases and middleware.
This white paper looks at some of the myths and pitfalls that may
have prevented companies from pursuing this fertile area for savings
and improved performance. We contrast these lingering objections
with the actual facts and realities, along with some practical guidance.
On the following page is a summary of the myths we’ll cover. Maybe you’ve
bought into some of these yourself? We will discuss each myth along with
buyer advice. At the end there is a comprehensive checklist on how to
avoid the pitfalls and realize more value from your enterprise software
support.
MYTHS,
PITFALLS
AND
REALITIES
Around Enterprise Software Support
A Buyer’s Guide

Myths, Pitfalls and Realities Around Enterprise Software Support: A Buyer’s Guide
3Rimini Street
Myths at a Glance
MYTH REALITY
Your software vendor is the
only source for software
support.
Proven options exist
outside of traditional vendor
support.
Enterprise software vendors
will not discount support and
maintenance.
Software vendors like
Oracle and SAP will now
negotiate support costs.
New software releases
are important for new
functionality.
Industry leaders are looking
beyond ERP to enable
innovation.
You have to self-support
customizations.
Support for customizations
can be included with your
software support.
You have to upgrade to stay
supported.
Forced upgrades to
maintain support are a
thing of the past.
You will be unable to upgrade
if you move away from vendor
support.
You are not frozen if you
leave vendor support.
If you leave vendor support
you lose access to new
modules and licenses.
Customers can purchase
new licenses and modules.
If you want to return to your
vendor there will be expensive
penalties.
The vendors want your
business.
Routine software patching
ensures security.
Reliance on software
patches gives a false sense
of security.
The vendor is the only source
of tax, legal and regulatory
updates.
There are proven
alternatives to Oracle and
SAP.
REALITYMYTH

4Rimini Street
Myth #1
Your software vendor is the only
source for software support.
Reality
Proven options exist outside of
traditional vendor support.
In the past, your only option to stay supported on your enterprise software was
to pay the support and maintenance fees dictated by Oracle and SAP. There are
several important consequences to this scenario. Obviously you are locked in
to continue to budget and pay high maintenance and support fees. And perhaps
even more importantly, you are constantly on the upgrade treadmill just to stay
supported: “Upgrade when the vendor dictates, whether it makes good business
sense or not. “
Guidance
Fortunately you have new options with the advent of independent support
(sometimes called third-party maintenance) for enterprise software. In fact, for
most companies independent support is not only an alternative but has many
advantages including:
n Cost savings
n No forced upgrades in order to stay supported
n Support for custom code
n Better responsiveness
There may be some anxiety around leaving ERP vendor support, but more than
1,000 companies have selected independent support as an alternative to Oracle
and SAP maintenance in return for cutting their maintenance fees by 50 percent,
better service, and customization support — along with guidance on security,
interoperability and upgrades at no additional charge. Some providers will offer a
specific primary support engineer whom you call directly and who is familiar with
your implementation — thus avoiding the nightmare of a call center staffed with
entry-level engineers that pushes you towards the vendor self-service model to
solve your own issues.
Just getting a quote from an independent support provider can decrease your costs,
as noted in Myth #2.
“If you have a support
renewal coming up,
remember you have the
choice.”
— Mark Bartrick, Gartner Blog,
April 14, 2014

5Rimini Street
Myth #2
Enterprise software vendors
will not discount support and
maintenance.
Reality
Software vendors like Oracle
and SAP will now negotiate
support costs.
Vendors are now discounting support and maintenance because, as pointed out
in Myth #1, there are new options for enterprise software support. As a result of
the competition, Oracle and SAP have been forced to the negotiation table, but not
without kicking and screaming. If you want to negotiate a better price for vendor
support, you have to approach this properly in order to effect a change. Ray Wang
of Constellation Research reports that “Respondents who secured a proposal from
a third-party maintenance provider on average received a 13.7 percent discount
on annual vendor maintenance fees.”1
This is a pretty amazing story and we
encourage you to read the entire report,“The Positive Pricing Impact ofThird-Party
Maintenance for Oracle and SAP Customers” available at: http://www.riministreet.
com/analyst-reports.
Guidance
First check out your maintenance renewal date. Trying to negotiate with Oracle
or SAP after you just sent them a check for next year does not put you in the driver’s
seat, but also don’t wait until the last minute. The process takes some time; ideally
you should start your research six months prior to your software support renewal
date. Then explore your alternative: independent support. Understand the pros
and cons of independent support vs. vendor support; remember, knowledge is
power in a negotiation. Next, request a pricing proposal from the independent
support vendor.
Forearmed, you can now have a knowledgeable conversation with your
vendor representative. Lay your cards on the table and let them know you have
alternatives you will pursue if they remain inflexible. Be prepared for a mild panic
on their part and even threats such as: “You won’t be able to return to the vendor
without significant penalties.”We’ll talk more about this in Myth #7.
“Consider bringing
an independent
maintenance provider
to the table when
undertaking contract
negotiations or planning
application strategy.”
— “Getting off the support treadmill,”
Inside SAP Magazine, March 2014
1
“The Positive Pricing Impact ofThird-Party Maintenance for Oracle and SAP Customers,”
Constellation Research, Mar. 18, 2013.

6Rimini Street
Myth #3
New software releases are
important for new functionality.
Reality
Industry leaders are looking
beyond ERP to enable innovation.
In the early years of ERP/CRM software, new releases from SAP and Oracle were
frequent and feature-rich. But as enterprise software has matured, the industry
giants have become slow to publish new releases and associated new functionality.
Today, releases tend to be more technical in nature, offering few advantages to
the business with a demonstrable ROI. In fact, Gartner analyst Dennis Gaughan
pointedly stated, when speaking of the software giants,“You won’t find innovation in
their product portfolio.”2
And according to Constellation Research,“SAP’s roadmap
is static until 2018 and beyond, despite any marketing messages to the contrary.”3
At the risk of becoming irrelevant, CIOs cannot wait on the enterprise software
vendors for functionality the business needs. The advent of the cloud has spawned
myriad inventive companies dedicated to providing features and functionality that
the giants are not delivering in a timely fashion. Oracle’s and SAP’s response in fact
has been to purchase cloud-based innovators like Ariba, Success Factors and Taleo.
Now is the time to move forward!
But there’s a big problem: lack of funds for innovation. Initiatives like mobility, big
data and social — or even just rolling out the products you have already licensed
— are stymied without budget. According to Forrester Research,“Today only 13
percent of the typical IT budget is going towards projects that drive innovation that
transforms the business to deliver a competitive advantage.”4
“Only 1% of SAP revenue
goes towards enhancing
current product.”
— “SAP’s Maintenance Price Hike Should
Concern Sourcing Professionals and their
CIOs,” Forrester Research, Feb. 14, 2013
2
“The truth about IBM, Microsoft, Oracle and SAP,” iTNews, Nov. 17, 2011.
3
“2014 AND BEYOND: Next-Generation ERP,” CIO.com, 2014.
4
“Gartner IT Key Metrics Data, 2014 IT Enterprise Summary Report,” Gartner, Jan. 31, 2014.

7Rimini Street
Guidance
Create budget to focus on innovation that brings value to the business.
Independent support can help you free up funds to implement those projects
that make you a hero to your organization. Typically independent support costs
50 percent of what SAP or Oracle would charge; additionally, any expensive and
time-consuming upgrades can be avoided unless they make good business sense
and can generate an ROI. No longer is there a reason to delay just because of
budget or time. For example, Embraer CIO Alexandre Baulé determined that his IT
operating costs and ERP software maintenance budget consumed 70 percent of the
total IT budget. Through independent support Embraer, achieved more than a 50
percent reduction; this made it possible for the company to redeploy its substantial
savings into new innovative initiatives that create competitive advantage in the
marketplace. As a result, InformationWeek honored Baulé with its IT Executive of
the Year award.
“The move to independent
support provided
immediate cost savings
along with better service,
which is a rare and
excellent combination.
Furthermore, the goal
was a 30-percent
reduction in our ERP
maintenance costs. We
achieved more than 50
percent.”
— Alexandre Baulé, CIO, Embraer

8Rimini Street
Myth #4
You have to self-support
customizations.
Reality
Support for customizations can
be included with your software
support.
Customizations are a fact of life. Most companies have them as part of their
software and many are significant. Software vendors not only do not support
custom code but frequently require you to perform gyrations to prove that your
issue is not caused by your customization. You’re left with three options:
1. Increase staffing to internally support your customizations
2. Hire consultants that will provide the customization support
3. Eliminate custom code
The first two options obviously involve additional cost. You’re already paying this
right now. Just as you write a check to Oracle or SAP each year for support, you’ve
got to accommodate the added costs of consultants or FTEs to support your
customizations.
Maybe you’ve eliminated or greatly reduced your custom code to avoid the added
budget. But for most, this comes with its own cost. Your business is unique. Your
process, your regulations and your customers, along with your culture, requires
most companies, particularly in some segments like manufacturing, to have a
degree of customization. Without the customizations it’s like having a GPS that only
can direct you to home and work: yes, it works — but how about some flexibility?
Guidance
What if you could have support for your customizations included with your
support fees at no additional cost? We won’t suggest you ask Oracle or SAP
to include this in their support costs — they’ll just laugh and possibly suggest
a costly consulting arrangement or engage one of their partners. Talk to an
independent support provider and ask if they will include customization
support at no additional cost.
“Now that we are under
an independent support
agreement, we’re able
to modify code and have
that supported, with no
worries for upgrades
overwriting that code.”
— Eric Robinson, CIO, Color Spot
Nurseries
“I’ve not only saved
money on my annual
maintenance and
support, but I’m no
longer having to hire
consultants at relatively
high hourly rates to
solve these issues.”
— Joel Gibbons, SeniorTeam Leader of
Enterprise Support/Compliance Officer,
National FFA Organization

9Rimini Street
Myth #5
You have to upgrade to stay
supported.
Reality
Forced upgrades to maintain
support are a thing of the past.
For many years companies have been forced to upgrade simply to maintain support.
In fact, according to a recent Oracle Applications User Group survey, 73 percent of
Oracle users upgrade simply to stay supported.5
SAP customers mirror this with 67
percent upgrading simply to maintain support.6
The average customer in production
is on an eight-year-old release; that is, they are three releases back and running
their business perfectly fine on a stable platform. Most customers don’t upgrade
to the latest and greatest release when it first comes out. They don’t need the
functionality and they want to wait a few years until the release is stable. In fact,
another recent survey indicates that only 35 percent of Oracle clients are planning
an upgrade. Among the top reasons given for not upgrading were: “Current
Application Meets Business Needs,”“Cost Prohibitive to Upgrade,”7
“Move to a New
Application Later” and “Not Enough New and Valuable Functionality.” Sure, if there
is a compelling business reason such as new functionality that delivers ROI to the
business, then you should upgrade. But that upgrade should be on your schedule,
not the vendor’s.
Guidance
Organizations should not upgrade without a compelling business case that “moves
the needle” — that is to say, Will the upgrade 1) increase revenue, 2) cut costs, or 3)
take market share from competitors? In many cases, the answer is no. But how do
you stay supported when your release becomes “de-supported”? — when you’re in
that purgatorial support period of continuing to pay high fees but receiving precious
little in return — no new program updates, fixes, security alerts and critical patch
updates, no new tax, legal, and regulatory updates, no new upgrade scripts, and no
certification with new third-party products/versions.8
“Ross Stores ... decided
that the money was
better spent on opening
new retail stores rather
than upgrading an IT
system that it didn’t
think needed upgrading.”
— “Oracle President Mark Hurd: We
don’t set out to be hard to work with,”
SearchOracle.com, Apr. 10, 2013
5
“ERP Upgrades: What’s Your Philosophy? 2012 OAUG Survey on Enterprise Application/ERP Suite
Upgrade Strategies,” OAUG Research Line, Feb., 2012.
6
“SAP Upgrade Benchmark Study,” Panaya Inc., 2012, http://go.panayainc.com/rs/panayainc/
images/SAP_Upgrade%20Survey_2012.pdf.
7
Rimini Street,“Oracle Applications Strategies for 2015 and Beyond,” Sept. 2014. [I inserted this
footnote — Eric]
8
Oracle Corporation,“Oracle Software Technical Support Policies,”July 18, 2014.

10Rimini Street
First, research your support expiration dates. (Many customers have no idea
that “de-support” for their release is imminent). You then have two options. You
can go it alone with self-support. Not an attractive route, but based on economic
circumstances, some customers may elect this path.
Self-support is not totally unreasonable to consider, since 85 percent of Severity 1
issues relate to customizations9
that Oracle and SAP don’t support anyway; but self-
support can present an unacceptable risk.
The second option — independent support — is a safer alternative, allowing you
to maintain high-quality support for your enterprise software regardless of
the age of your release. Plus the cost is typically 50 percent of what the vendor
is charging. Make sure to check with the support provider to ensure they will
guarantee support for your release for at least 15 years. Learn more about upgrades
in Myth #6.
9
“The Value of Support for Customized Code,” Rimini Street, www.riministreet.com/business-
topics/customization.

11Rimini Street
Myth #6
You will be unable to upgrade
if you move away from vendor
support.
Reality
You are not frozen if you leave
vendor support.
You’ve been paying support and maintenance fees to the vendor for many years,
which entitles you to maintenance components that you can take with you when
you leave vendor support — documents, patches, upgrades, scripts and more. This
means that you can continue to upgrade if you choose to move away when and if it
makes good business sense. But the process of archiving these elements is critical
to ensure a smooth future upgrade. You need to download and archive everything
you are entitled to as of your date of separation from vendor support. Anything
less can jeopardize a future upgrade. Anything more can put you in breach of your
software license.
Guidance
Upgrading on your own schedule is a wonderful freedom, but archiving to protect
this ability has to be done with precision. It’s not something to tackle on your
own, as you’d have to do with self-support. So assuming you want to align with
an independent support provider, investigate how that support provider will
assist you in archiving. Do they employ archiving processes that are ISO: 9001
compliant to ensure you store all that you are entitled to? How many archives
have they done? Asking these simple questions can preserve your ability to
move to the most current release in the future.
Many companies are reinvesting the monies saved through independent support
to fund installing shelfware, rolling out to more divisions and geographies,
implementing new third-party solutions or enabling other strategic initiatives. As
CIO.com observes: “An increasing number of CIOs are rethinking their enterprise
software maintenance strategies — the goal being to redirect savings toward higher-
value initiatives in the era of postmodern ERP using hybrid IT as a key strategy.”10
More on fire than frozen.
“Far from deserting
SAP though, for many
[independent support]
customers, freeing up
additional budget by
cutting their support
costs in half, typically,
means they can then
reinvest with SAP in
other areas.”
— “Getting off the support treadmill,”
InsideSAP Magazine, Mar. 2014
10
“2014 AND BEYOND: Next-Generation ERP,” CIO.com, 2014.

12Rimini Street
Myth #7
If you leave vendor support you
lose access to new modules and
licenses.
Reality
Customers can purchase new
licenses and modules.
You need to buy an additional module or seats from your software vendor because
of growth to support the business. No problem.
The sales and maintenance departments of ERP vendors are two separate
organizations with different objectives. While the support group may not like it, the
sales group is more than happy to take your money so they can make quota and
earn commission. You are, after all, still their customer.
Guidance
Oracle and SAP customers routinely purchase new seats and modules
outside of vendor support. You are still a client with a perpetual license
agreement. Oracle and SAP don’t turn away customers offering them money for
new licenses or products.
For example, companies like Toys ‘R’ Us have purchased additional E-Business
Suite seats from Oracle while under independent support. Color Spot Nurseries
has added new licenses to its SAP ERP. Color Spot Eric Robinson commented:
“I successfully negotiated new SAP licenses on 12/31/12. A very good day for
making deals with SAP as we all know. They sold me licenses without maintenance
at a discount. So, it can be done. And timing is everything.” And now Color Spot is
currently working with SAP to add BusinessObjects to its applications portfolio.
“Would BusinessObjects
be a product that SAP
would sell us and add
onto our current ERP
system? Not a problem.”
— Eric Robinson, CIO,
Color Spot Nurseries

13Rimini Street
Myth #8
If you want to return to your
vendor there will be expensive
penalties.
Reality
The vendors want your business.
Software vendors are all bark and no bite. The reality is once a client leaves
vendor maintenance, they become a prospect all over again. Former independent
support clients have always been able to relicense the latest software release at
very attractive terms, and have even ended up with license fees discounted up to
90 percent. There is an industry understanding that Oracle, for example, requires
customers to be off Oracle maintenance for at least two years before Oracle sales
reps are allowed to “relicense” the software. Choice means more negotiation
leverage and a better bargaining position for you the customer.
Guidance
The independent support model anticipates that many clients will eventually go
back to the vendor after saving money for 5–10 years. There is a lot of competition
for enterprise software, particularly with the advent of cloud including companies
like Workday and NetSuite, and your purchase orders are always enthusiastically
welcomed by the big software vendors.
Mark Bartrick of Forrester Research put it succinctly: “Software vendors develop
software to sell, and if you are a client of theirs, they want you to increase your
license usage over time. That’s how they make money. So if the vendor brings
out a significant new software release in the future that offers genuine functional
benefit to your organization, that may be a good reason to consider going back. In
that case, being a savvy negotiator, you can offer the software company the carrot
of both new license revenue and regaining the support contract if it can make the
combined deal very attractive to you.”11
A $64B logistics provider
secured more than a
90% discount off list
price on the latest
release upon returning
to the vendor from
independent support.
Annual support fees
were slashed by over
64% including right-sizing
and reducing overhead
on an over-licensed
Siebel application.
11
Mark Bartrick,“The Emerging Third-Party Software Support Marketplace: QA,” Forrester
Research, October, 2012.

14Rimini Street
Myth #9
The vendor is the only source of
tax, legal and regulatory updates.
Reality
There are proven alternatives to
Oracle and SAP.
Tax, legal and regulatory updates are incredibly complex. Every day, around the
world, regulations, standards and legislation for payroll taxes, transaction taxes and
financial accounting, reporting and compliance are constantly changing. You need
to prepare for and respond to a variety of events — including recurring updates, ad-
hoc regulation and policy changes, and major transitions like new IFRS accounting
standards. Payroll, human resources, benefits, pension, accounts payable, asset
management and other applications require high-quality and timely tax, legal and
regulatory updates for local, state, provincial and national jurisdiction compliance.
Guidance
There are alternatives to SAP or Oracle tax, legal and regulatory support
including some independent support providers as well as some tax and
regulatory specialists. But because of this issue’s criticality, you need to vet
the provider diligently to understand their processes and quality control.
ISO 9001:2008 certification is important in this regard as it helps insure quality
and consistency. For example, no single source of tax, legal and regulatory data
provides the information needed to assure a complete scope and full accuracy
— it’s imperative to compare multiple sources. Therefore, to ensure the veracity
of its research and deliverables, your provider of updates should utilize a triple-
check methodology that includes direct government verification, use of the leading
regulatory research reporting services, and tertiary sources that include top global
accounting and legal firms.
Find out if the provider supplies updates for the geographies and languages you
need, not just now but in the future. Finally, they should be able to provide updates
that are tailored to your specific needs and implementation — not just a bundle of
all 50 states including Puerto Rico when you only need Pennsylvania, causing you
more work, more testing and potential issues.
“Independent support
delivers our mission-
critical updates
ahead of the vendor’s
planned release date
and packages them
so they can be easily
applied to our software
environment. This
proven process for
managing tax and
regulatory updates
is a key advantage of
independent support.”
— Glen Ruyter, IT Manager, Eventis

15Rimini Street
Enterprise Software Support Buyer’s Checklist
Costs
Have you ever tried to negotiate your enterprise software support?
Have you investigated independent software support?
How much do you currently spend to support customizations? Ask your
support provider to include fixes for custom code at no additional cost.
Will your support provider include guidance on security, interoperability and
upgrades at no additional cost?
Innovation
What % of your IT budget goes to “keeping the lights on”?
Do you have any initiatives that you are currently unable to fund that would
be helped by a 50% reduction in maintenance and support fees?
Your Software Roadmap
Would you like to stay on your current release and not be forced to upgrade?
Are you currently or soon to be “de-supported” on your release?
If you are considering independent support, does the provider have ISO 9001
compliant archiving processes? And how many archives have they done?
Will your support provider guarantee they will support your current release
for 15 years?
Security
Do you rely on vendor patches to assure system security?
Are you current on your patches?
Will your support provider include vendor-neutral security guidance at no
additional cost?
Is the vendor ISO 27001:2005 certified to ensure security?
Tax, Legal Regulatory
Is the provider’s tax, legal and regulatory update process ISO 9001:2008
compliant?
Do they triple-check their information — direct government verification, use of
the leading regulatory research reporting services, and tertiary sources?
How many regulatory updates have they published?
Are there capabilities to address all geographies and languages that you
require and that may be required in the future?
How many countries do your need them to cover?
Will they provide tailored tax, legal and regulatory updates, so you receive
only the updates you need for your specific implementation?

About Rimini Street, Inc.
Rimini Street is the leading independent provider of enterprise software support
services. The company is redefining enterprise support services with an innovative,
award-winning program that enables Oracle and SAP licensees to save up to 90
percent on total support costs over a decade, including saving 50 percent on their
annual support fees. Clients can remain on their current software release without
any required upgrades or migrations for at least 15 years after switching to Rimini
Street. Hundreds of clients, including global, Fortune 500, midmarket, and public
sector organizations from across a broad range of industries have selected Rimini
Street as their trusted, independent support provider.
Rimini Street and the Rimini Street logo are trademarks of Rimini Street, Inc. All
other company and product names may be trademarks of their respective owners.
Copyright © 2012–2014. All rights reserved.
www.riministreet.com
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