Leading manufacturer of additive-free cosmetics and health food products in Japan accelerates digital transformation and obtains premium-level support
LAS VEGAS, March 18, 2019 – Rimini Street, Inc. (Nasdaq: RMNI), a global provider of enterprise software products and services, the leading third-party support provider for Oracle and SAP software products and a Salesforce partner, today announced that FANCL, a leading additive-free cosmetics and health food products company in Japan, has switched to Rimini Street support for its SAP ECC 6.0 system. Rimini Street has enabled FANCL to take full control of their ERP roadmap and chart its direction based on the company’s business needs — like advancing their digital transformation initiatives — versus continuing to follow a vendor-dictated roadmap. Additionally, FANCL now receives premium-level, ultra responsive support for its current, stable SAP system for a minimum of 15 years from the time the company transitioned to Rimini Street. The company also immediately realized savings of 50 percent in annual support fees. FANCL is able to reinvest this significant cost saving into updating and modernizing the company’s customer management and sales systems – which had become a bottleneck for innovation – as well as updating their mail ordering, store purchases and online systems. FANCL will also be able to introduce new technologies for increased data protection.
Moving to a Business-Driven IT Roadmap
FANCL introduced their SAP R/3 in 2006 for their accounting, sales, logistics, quality control, inventory control, human resources, and production control. Their SAP system was the foundation for connecting and sharing internal data from the production line to other departments like sales, which improved communications throughout the organization.
FANCL upgraded to SAP ECC 6.0 in 2011, and found the most challenging obstacle with their upgrade was the significant cost and time involved. The company discovered that the vendor was not providing support for the customizations they made to their system, which covers major portions of their business from production to retail service, and needed more support. FANCL began to grow dissatisfied with the support they were receiving from the vendor especially when they considered the high cost and support response time. The company made multiple attempts to reduce costs with SAP by eliminating unnecessary licenses, but the only option suggested by the vendor was to install different licenses, which in turn prompted them to begin researching alternative options. FANCL was not only looking for better maintenance support and lower costs, but also to regain control of their system and to proactively work with the company on a more business-driven IT roadmap.
“When we originally implemented our ERP, we achieved significant results including being able to properly account for inventory, but as the company grew, our ERP system began to have too many licenses which our system no longer required. We were in a vendor lock-in, losing money and needed to reassess each license,” said Masaki Ikemori, the corporate system group section manager, FANCL Corporation. “After we switched to Rimini Street, we were able to leverage the expertise of our support team and regain control of our system by reanalyzing the cost structure and licenses and free up internal resources to contribute to our digital innovation projects. Also, we can now plan for the future without being bound by the vendor’s expiration date of 2025 for our current SAP release.”
Breaking Free of Vendor Lock-in and Obtaining Improved Service for Future Innovation
“Through partnering with Rimini Street, we now recognize we can make changes within our organization such as breaking away from the vendor’s lock-in strategy – which we once thought of as unavoidable – by questioning the status quo and researching alternative solutions to support our ERP system,” said Nobuyuki Uematsu, executive officer, head of Group IT center, FANCL Corporation. “Previously the IT department was perceived as a part of the cost center under the administration division, with the appointment of our new president in 2017, the department was recognized as the Group IT Center and became the independent division responsible for the company’s IT strategy for better corporate management. We switched to Rimini Street during this change, and this helped accelerate a long-awaited process of rebuilding our system’s foundation, which was completed in nearly one year, against our estimation of several years. We are now able to move through our IT challenges with a true partner; Rimini Street helps enable our innovation today and in the future, including a new security system and creating our path to digital transformation.”
As with all Rimini Street clients, FANCL was assigned a senior level Rimini Street Primary Support Engineer (PSE), who, across the team, average 15 years’ experience. FANCL also receives Rimini Street’s industry-leading service level agreement (SLA) guaranteeing access to a team of local engineers 24/7/365 to address support issues and a 15-minute response time for Priority 1 critical cases.
“With the support of Rimini Street, FANCL has been able to maintain the value of their current, robust system while leveraging new found savings and internal resources for rebuilding their ERP foundation and accelerate planning for a cloud migration,” said Yorio Wakisaka, general manager, Japan, Rimini Street. “FANCL has succeeded in reforming their IT department, taking control back from the vendor, driving digital innovation and amplifying technical advantage in an increasingly competitive retail market.”