Because my ultimate bosses are family farmers, I do not get a lot of credit for spending money on technology for technology’s sake. Farming is a tough business, and they are right to have high expectations of the technology investments we make.
Welch’s is such a well-known brand many people probably assume we’re a subsidiary of some big food conglomerate. In fact, we are an agricultural cooperative that exists to market products made from Concord and Niagara grapes, owned by the family farmers that grow them.
As the representative of those family farmers, a few years ago my CEO turned his attention to IT as the source of overhead expenses that did not seem productive. I was feeling the heat when I found Rimini Street, which allowed me to cut one of the biggest items in our IT budget, our ERP software maintenance contract with Oracle.
Prior to that change, I was in in the awkward position of trying to explain to my CEO why our IT budget was so large, in proportion to the rest of our business, even after we had spent millions to license and implement an ERP system that was supposed to make us more efficient. When we switched to third party support, I was able to breathe again because the amount we shaved off our budget accounted for about a quarter of the company’s net income that year.
Don’t get me wrong: our Oracle EBS system had indeed brought important efficiencies to our business operations-functionality we need to be competitive. What we were not getting as much value from was the maintenance contract: the substantial fee we were paying Oracle each year for support and software updates. The amount of the fee was equivalent to repurchasing the software every few years.
Trouble was, even when the updates Oracle provided included new product features, they were not features we needed. EBS delivered more functionality than we would ever need on day one for common business functions. Where we needed enhancements, we typically had to build them ourselves. For example, when we entered into co-manufacturing arrangements as a way of bringing new products to markets, we did our own development of interfaces to their systems.
Customizing an ERP can be tricky, and often it’s when the custom code breaks that you really want a partner to offer expert support. That is also where the difference between Oracle maintenance and Rimini Street support is most obvious because Oracle doesn’t support custom code or integrations, only its own core software.
In contrast, Rimini Street makes experienced software engineers available to help us solve our toughest problems, customizations and all. They promise a response for urgent issues within 10-minutes, and every support case is overseen by a Primary Support Engineer(PSE) who knows our applications and how they are configured. In really tough cases, our PSE, in turn, can call on the expertise of a large and growing network of colleagues with their own expertise. We may not call them often, but when we do we know we can count on them for prompt and meaningful support.
Because ERP is core to the operation of any modern enterprise, I would never want to be without someone to help us keep our core systems running. Even as we avoid unnecessary upgrades, we need a partner to help maintain compatibility with the always evolving IT environment as new technology standards like operating systems, middleware, and web browsers come on the scene. Rimini Street actually provides us with more complete support at a fraction of the cost.
New security threats are forever cropping up, too. In addition to helping us keep our systems secure, Rimini Street has provided savings I’ve been able to reinvest in hiring a cybersecurity officer to help us lower our risk profile.
For at least the next several years, I do not see any reason to upgrade our EBS software. Given that we run 35 to 40 modules, including financials, payroll, order management, and process manufacturing, I estimate an upgrade would cost us at least $4 to $5 million. I don’t see how an upgrade can be justified.
Meanwhile, I’ve adopted a “cloud first” approach to IT. Mostly, that means taking advantage of novel capabilities from innovative new companies that were born in the cloud. I’ve looked at Oracle’s cloud ERP, but so far it doesn’t match the functionality in our existing implementation.
That said, I do my best to maintain a good relationship with my Oracle contacts. They remain interested in selling us additional licenses, and I’ve made it clear that when I’m shopping for cloud software I will consider their offerings, where they have delivered something innovative.
All I need is a business case that I could justify to a family farmer.