Survey Finds Majority of SAP Licensees Plan to Continue Running Their Proven ERP Release and Are Not Committed to Moving to S/4HANA

Respondents cite hybrid IT as a preferred strategy for leveraging current robust ECC release as foundational system of record; More than 50 percent of respondents estimate S/4HANA reimplementation costs between $10 and $100 million

LAS VEGAS, June 22, 2017 – Rimini Street, Inc., a global provider of enterprise software products and services, and the leading independent support provider for Oracle and SAP products, today revealed the findings from a recent global survey of SAP licensees conducted by Rimini Street to better understand their SAP application strategies and future plans. A key finding in the report is that the dominant strategy for SAP licensees, selected by 89% of respondents, is to continue running their current proven SAP ERP releases1, given that the rich functionality of their current releases meet business needs and also forms the foundation of a preferred hybrid IT model. Additionally, 65% of survey respondents have no plans to, or are currently not committed to, migrate to S/4HANA2, with the number one reason for not committing to S/4HANA cited as “no strong business case and unclear ROI.” The report, “Rimini Street Survey: 2017 SAP Applications Strategy Findings,” is based on responses from CIOs, CTOs, IT VPs, directors and managers from a broad range of industries and company sizes across North America, Europe, Latin America and Asia-Pacific.

Hybrid IT Strategy Optimizes the Value of SAP ERP

Of the survey respondents that plan to stay on their current SAP Business Suite application, 30% are already adopting a hybrid IT strategy to maximize the value of their core SAP system as a system of record, while also freeing up funds and resources that can be used to more quickly and flexibly drive innovation through systems of engagement. A hybrid IT strategy offers the best of both worlds – it provides the ability to reliably run the business on a robust core ERP application, and at the same time enables an organization to more quickly adopt new innovative applications and services, including cloud, mobile and analytics. Organizations have the flexibility to deploy systems of engagement from any technology provider, including SAP, which enables faster time to innovation and overall competitive advantage. In addition, an increasing number of companies are running their SAP ERP implementations in their private cloud or hosted environment, realizing many benefits of the cloud model without a costly, risky reimplementation. By shifting IT funds from expensive, disruptive upgrades to innovation, a hybrid strategy can accelerate the achievement of business objectives.

Of the survey respondents that plan to stay on their current SAP Business Suite application, 30% are already adopting a hybrid IT strategy to maximize the value of their core SAP system as a system of record, while also freeing up funds and resources that can be used to more quickly and flexibly drive innovation through systems of engagement. A hybrid IT strategy offers the best of both worlds — it provides the ability to reliably run the business on a robust core ERP application, and at the same time enables an organization to more quickly adopt new innovative applications and services, including cloud, mobile and analytics. Organizations have the flexibility to deploy systems of engagement from any technology provider, including SAP, which enables faster time to innovation and overall competitive advantage. In addition, an increasing number of companies are running their SAP ERP implementations in their private cloud or hosted environment, realizing many benefits of the cloud model without a costly, risky reimplementation. By shifting IT funds from expensive, disruptive upgrades to innovation, a hybrid strategy can accelerate the achievement of business objectives.

High Cost and Risk of S/4HANA with Low ROI

In addition to citing “no strong business case and unclear ROI,” for the low commitment to S/4HANA, another top reason by survey participants for the low commitment to S/4HANA is the “high migration and reimplementation costs.” Of those respondents who have committed to S/4HANA, 56% estimated the total cost of reimplementation for a move to S/4HANA to be between $10 and $100 million, an expensive undertaking which makes it difficult to build a positive business case for the move and is financially untenable for many organizations.

Additional Survey Highlights:

  • 47% of respondents consider SAP’s support and maintenance costs to be too high.
     Nearly half of all respondents feel that SAP support and maintenance costs are too high, including those who state that the costs are “way out of control.” With the continued high cost of SAP support, budgets are squeezed and resources stretched thin. With Rimini Street, clients consistently realize cost savings of up to 90% in total maintenance costs as they are no longer on the upgrade path dictated by the vendor, no longer need to budget resource for self-support and no longer need to seek outside support for their customizations which are not covered by the vendor.
  • Respondents cite top issues with SAP’s support.
    The top three areas cited as problematic for SAP support, based on a survey question that allowed for multiple responses, include “Issues take too long to resolve” (36%), “Lack of support for customizations” (33%), and “Lack of expertise or adequate knowledge to resolve issues” (29%). These critical gaps in SAP support point to the need for an alternative solution that offers better, more responsive service than is available from the vendor today. Rimini Street addresses all of these issues by providing full support for SAP customizations, a dedicated Primary Support Engineer with an average of 15 years’ experience with SAP applications, and a guaranteed service level agreement response time of 10-minutes for critical issues.

“This survey highlights that CIOs and IT decision makers prefer to maximize the value of their current robust SAP ERP system that more than meets their business requirements, rather than advancing to a new platform that is still in development with no current business case to support a full reimplementation. It also illustrates how they are pursuing innovation strategies, such as hybrid IT, to help their business gain competitive advantage now, without having to wait indefinitely for meaningful new innovations and capabilities from SAP,” said Seth Ravin, Rimini Street CEO. “Today, Rimini Street supports nearly 1,300 clients running IBM, Microsoft, Oracle and SAP software, providing them with our premium-level enterprise software support and reducing their total maintenance costs by up to 90% – costs which can be redeployed to fund strategic initiatives for their business.”

To download a copy of the report “Rimini Street Survey: 2017 SAP Applications Strategy Findings,” please click here. For additional information on support services available to SAP licensees, please go here.

 

1, 2 Rimini Street Report, “Rimini Street Survey: 2017 SAP Applications Strategy Findings,” May 2017

About Rimini Street, Inc.

Rimini Street, Inc. (Nasdaq: RMNI) is 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. The Company offers premium, ultra-responsive and integrated application management and support services that enable enterprise software licensees to save significant costs, free up resources for innovation and achieve better business outcomes. To date, more than 3,500 Fortune 500, Fortune Global 100, midmarket, public sector and other organizations from a broad range of industries have relied on Rimini Street as their trusted application enterprise software products and services provider. To learn more, please visit https://www.riministreet.com, follow @riministreet on Twitter and find Rimini Street on Facebook and LinkedIn.

Forward-Looking Statements

Certain statements included in this communication are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by words such as “may,” “should,” “would,” “plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “seem,” “seek,” “continue,” “future,” “will,” “expect,” “outlook” or other similar words, phrases or expressions. These statements are subject to a number of risks and uncertainties regarding Rimini Street’s business, and actual results may differ materially. These risks and uncertainties include, but are not limited to, the duration of and economic, operational and financial impacts on Rimini Street’s business of the COVID-19 pandemic, as well as the actions taken by governmental authorities, clients or others in response to the COVID-19 pandemic; catastrophic events that disrupt Rimini Street’s business or that of its current and prospective clients, changes in the business environment in which Rimini Street operates, including inflation and interest rates, and general financial, economic, regulatory and political conditions affecting the industry in which Rimini Street operates; adverse developments in pending litigation or in the government inquiry or any new litigation; Rimini Street’s need and ability to raise additional equity or debt financing on favorable terms and Rimini Street’s ability to generate cash flows from operations to help fund increased investment in Rimini Street’s growth initiatives; the sufficiency of Rimini Street’s cash and cash equivalents to meet its liquidity requirements; the terms and impact of Rimini Street’s outstanding 13.00% Series A Preferred Stock; changes in taxes, laws and regulations; competitive product and pricing activity; difficulties of managing growth profitably; the customer adoption of Rimini Street’s recently introduced products and services, including its Application Management Services (AMS), Rimini Street Advanced Database Security, and services for Salesforce Sales Cloud and Service Cloud products, in addition to other products and services Rimini Street expects to introduce in the near future; the loss of one or more members of Rimini Street’s management team; uncertainty as to the long-term value of Rimini Street’s equity securities; and those risks discussed under the heading “Risk Factors” in Rimini Street’s Quarterly Report on Form 10-Q filed on August 5, 2020 and as updated from time to time by other filings by Rimini Street with the Securities and Exchange Commission. In addition, forward-looking statements provide Rimini Street’s expectations, plans or forecasts of future events and views as of the date of this communication. Rimini Street anticipates that subsequent events and developments will cause Rimini Street’s assessments to change. However, while Rimini Street may elect to update these forward-looking statements at some point in the future, Rimini Street specifically disclaims any obligation to do so, except as required by law. These forward-looking statements should not be relied upon as representing Rimini Street’s assessments as of any date subsequent to the date of this communication.

© 2020 Rimini Street, Inc. All rights reserved. “Rimini Street” is a registered trademark of Rimini Street, Inc. in the United States and other countries, and Rimini Street, the Rimini Street logo, and combinations thereof, and other marks marked by TM are trademarks of Rimini Street, Inc. All other trademarks remain the property of their respective owners, and unless otherwise specified, Rimini Street claims no affiliation, endorsement, or association with any such trademark holder or other companies referenced herein.

Investor relations contact:

Dean Pohl

Rimini Street, Inc.

+1 925-523-7636 dpohl@riministreet.com
Media relations contact:

Janet Ravin

Rimini Street, Inc.

+1 702-285-3532 pr@riministreet.com