It’s the one thing you can predict.
There are global challenges that impact every business every day. Labor shortages, pandemics, inflationary pressures, tight budgets, rising interest rates, supply chain disruptions, and geo-political considerations, are just some of the very serious global challenges impacting every organization today. With all these challenges and the resulting squeeze on profitability, business and IT plans need to remain nimble and realtime ready.
Doing nothing is simply not an option. The organizations that survive and thrive through turbulence take proactive action in partnership with their CIOs to adjust their business and IT priorities, objectives, and investments.
But funding strategic IT priorities can be difficult at companies where rising costs outpace revenue. Many core cost items that were once seen as necessary – such as managing data centers, maintaining software licenses, or undertaking expensive and disruptive vendor-directed upgrades – are now coming under scrutiny. One of the critical considerations for IT spending is prioritizing the projects that yield positive business outcomes, with 67% of CFOs agreeing that they cannot afford to waste money on IT projects that don’t “move the needle.”1
It can strengthen your business
Evolving market conditions put pressure on organizations to adapt and change. External stresses like recessions, pandemics, and geopolitical upheaval test your organization’s ability to re-direct investments and adapt to change. According to a PwC survey, “Some 73% of global CEOs believe global growth will decline in the next 12 months – the most pessimistic outlook since this question was first asked 12 years ago.”1
A CFO’s biggest challenge is identifying the critical areas where investments should be accelerated. Doing this against a backdrop of uncertainty requires foresight and the ability to be flexible.
One way to support organizational flexibility amidst market pressures is by clearing technology debt, which occurs when the value of a legacy technology asset no longer justifies the cost of maintaining it. This is not to suggest that all older software should be classified as technology debt. Critical core systems and applications – often highly customized to fit an organization – are sometimes perceived by IT teams as a barrier to getting faster, better, stronger, or leaner. In reality, the opposite is often true. For instance, software vendors might pressure their customers to upgrade to the latest release or migrate to a new cloud solution — regardless of a customer’s unique objectives. The cost and effort of complying with this vendor-dictated roadmap can sometimes be at odds with business priorities.
The smart move is to innovate around the edges of a mature, functional, stable, and high-performance core. By doing so, organizations can reduce technology debt, grow revenue and attract new talent without abandoning a legacy system that is serving a vital purpose.
EXIT THE UNNECESSARY
And do more with what you have
Chances are, your company has made a significant investment in licensing, implementing, customizing, and maintaining its current enterprise software, database instances, middleware infrastructure, and even web browser or operative system versions. One way to think about cost reduction in your organization is to simply re-assess how you manage IT investments.
You can drive significant cost savings and additional ROI without the need to perform unnecessary and costly ERP upgrades, migrations, or rip and replace projects.
At Rimini Street, we help our clients replace expensive Oracle and SAP annual maintenance contracts with a more responsive, more comprehensive, support service that can deliver up to 90% operating cost savings. These dramatic savings allow companies to focus their limited IT labor and financial resources on strategic initiatives that can enhance their competitive advantage to do things like drive growth, invest in talent, or deliver more innovative services to customers and clients.
How to support them, how to retain them
In the current market, a major concern for all companies is the ability hire and keep their best people. 54% of CFOs point to “hiring and retaining” as their most difficult task over the next 12 months.1
The labor market is for IT is especially tight for every role. According to a report by CIO Magazine, “42% of IT leaders said talent gaps are slowing IT modernization initiatives.”2 This puts pressure on current talent and staff to fill in the gaps. One way to solve the problem is through retraining. Another way is to outsource the specialized services and expertise you need to help your best people do their jobs better.
As part of our core service and support, Rimini Street has deep bench of enterprise technology experts with over 20 years average experience among primary support engineers. And we have the breadth of global resources around the world – around the clock – to support client operations in over 150 countries, in 10 languages.
“Rimini Street adapts to what we want to do. It is truly an extension of my internal SAP support team.” -Erik Looi, CIO at Alliance Contract Manufacturing
In an inflationary market
Currently, one of the most common reasons that software vendors cite for price increases is inflation.
Some software vendors are even using their existing support and maintenance offerings as a way to sell-in new products to customers, with scant attention to profitability and growth. Gartner predicts that by 2025, 50% of organizations will be forced to make their subscription or support a single-year contract with 8% or more annual adjustment rates.1
To address inflation’s impact on SaaS costs, procurement and vendor management leaders must alter the way they have historically negotiated and managed SaaS contracts.
Which is why a lot of companies are seeking alternatives to vendor support.
Advanced support and services from Rimini Street has helped more than 5,000 clients significantly reduce Oracle, SAP, IBM, and Microsoft support costs, allowing them to invest in digital transformation programs that drive competitive advantage and growth.
“As a critical system matures, it must have both internal and external maintenance resources, but operate at a lower cost, so that resources can be reallocated to innovative systems or technologies.”
– Morgan Chang, IT Director, Globe Union