Today I am going to present an interesting finding of Nucleus Research regarding anatomy decision When Oracle JD Edwards EnterpriseOne and SAP compete in the midmarket. You will find the reasons why customers selected JD Edwards rather than SAP. Here is the finding..
Cost
It would not be surprised if a lot of EnterpriseOne customers cited cost as a factor which drove their decision of enterprise application software; but, it was not the only deciding factor. Customers persistently said SAP would be more costly in implementation and also support:
We had looked at SAP but cost of ownership, cost of implementation, and ease of implementation led us to JD Edwards. A lot of our customers are on SAP so we considered if that was an advantage and ultimately, the answer was not really.
SAP’s implementation will cost you far more than EnterpriseOne. I know how costly they can be if you don’t manage it properly, and we knew JD Edwards would cost far less.
Both SAP and EnterpriseOne were considered and it came down to cost. JD Edwards was significantly cheaper.
Customers also stated that, while lower cost was essential, so was the capability to confidently budget and plan for initial and also ongoing costs as well as implementation timelines. Nucleus has discovered that EnterpriseOne Business Accelerators take many of the variables out of budgeting and planning for implementing enterprise application – however in general, the majority of customers think that EnterpriseOne has more predictable time to value compared to SAP. In some cases, customers felt SAP had not provide them the comprehensive cost picture so it was hard to entirely evaluate their proposals for budgeting and planning purposes:
We asked for cost per hour for training, implementations, and all the hourly rates so we could determine costs. SAP was a more expensive program, but they never really got to the full proposal stage – Oracle and the consultants gave us all the details we needed.
You have to take into consideration all facets of the cost. SAP comes in and says, ‘this is our base package and what we can do,’ but all the add-ons add up. They say, ‘yes, we showed you, but that’s an additional package.’ They show you the world and then give you a quote only on Asia. Then if you want the rest of the world, it’s xyz. JD Edwards is more structured. If you’re looking at distribution, for instance, they show you exactly what they can do.
Being able to confidently predict the enterprise application projects cost and timeline is growing in importance in the process of decision making for all customers, simply because this kind of ability minimizes the business risk and disruption.
Flexibility
Nucleus discovered that lots of decision makers had previous experience with SAP and also other enterprise applications and, based on their experience, thought that EnterpriseOne would provide them the flexibility they required to support their business processes without expensive customization. The capability in modifying source code of product and utilize their own internal development team enabled higher flexibility too.
Customers said:
SAP is very rigid – you have to do it the SAP way. Sometimes that’s good, but often it’s bad.
The [ability to modify the] source code in EnterpriseOne has its merits because we have in-house development when we need to make changes. With SAP you have to go back to the vendor and that would be a lot more expensive.
Overall, customers believed that EnterpriseOne would provide them with the flexibility to grow and also evolve as their business grew.
Functionality and complexity
Number of midmarket companies move to “Tier One” enterprise applications because they need a solution for supporting their growth over the long term, and because smaller enterprise packages do not have capability to support their business complexity. However, maximizing ROI of enterprise applications is about balancing usability and functionality: companies have to purchase kind of application that offers the appropriate functionality amount to support their business requirements, but not too much because it will down usability and make more complex and risky in implementation, and drive higher costs for ongoing support.
Nucleus found a number of EnterpriseOne customers selected EnterpriseOne because they believed it was the proper match for their business: sufficient functionality to address their requirements, but not as complicated in implementation and support as SAP.
Customers said:
We went through a tremendous template to determine things that we wanted and whether they could be in the application or third party, and prioritized the critical components. Oracle had pretty much filled all the gaps.
It was the simplest package to purchase that was able to handle our formulations.
Our decision was based on system-related stuff. We looked at specific needs that we had and which system could do it best.
In the case of SAP, it was a lot more costly for the amount of functionality that we would ultimately use in the product. In some cases, SAP had a little more functionality than EnterpriseOne, but a lot of it we wouldn’t have used.
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Source : NucleusResearch.com
Read more :
SAP Vs. Oracle
ERP market share and vendor evaluation 2011