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SAP vs. Oracle, Battle Royale
Mark Brunelli writes "As the battle for business application supremacy heats up, Oracle users are standing by Larry Ellison and Fusion while SAP customers say NetWeaver will lead the way to victory." From the article: "Zoellner, who says he has worked with both Oracle and SAP users throughout his career, believes that the Nucleus Research study cited by deHenry is right on in its conclusion that Oracle's average three-year total cost of ownership (TCO) is 48% lower than SAP's. The business analyst said that the TCO issue is particularly important to companies in developing areas."
Why isn't Net present value used as the benchmark for comparing two IT projects? It really is the only one that makes sense because TCO doesn't take into account the interest rate.
it's a carefully placed advertisement from the Oracle PR machine. 48%? Gimme a break, no one can determine TOC figures for something as complicated as SAP to that degree of precision.
Its too risky for a big corporation or organisation to develop one... You would need auditor sign offs etc.
No, this is no different from any business software. ERP is just lots of little packages working together to organise a business.
And the Oracle and SAP systems are top end...
Only in the sense of "big money". The actual software itself is bottom end. As pretty much anybody who's used it will tell you.
for large organisations milllions of transactions a day. Scaleable systems at that size are not built quickly
FUD. Google, with one of the largest setups on the planet, uses open source software and doesn't seem to have any trouble. Scalability is just a design issue. Like everything else.
and people want to have a vendor to blame.
Sigh, more FUD. I'm quite sure that there are plenty of open source companies that would be happy to step up to the plate for an extremely good value maintenance contract (by SAP/Oracle standards) for any set of software a business wanted.
There are legal issues as well to ensure Sarbanes-Oxley and Basel II compliance.
No different from any piece of business software.
I have tried to get my company to look at building an open source System to replace Peoplesoft instead of Fusion... but there is no interest.
At your company.
Open source ERP is potentially a large investment that could take a while to get payback on but it is also an area that could be done incrementally. There are a number of open source workflow packages that could form the nucleus of an ERP and there are many open source packages that could be adapted to perform various ERP functions. I'd suggest open source companies interested in this area pick some element of the ERP puzzle and specialise in it. By using open standards your software can then work with other ERP specialists and cover a larger part of the ERP space.
If anyone does want to start one though - Im in !
Glad to hear it.
A big hurdle an open source ERP package would face is to find a businesses where the software could be tested in real life. Very few businesses would be willing to risk their core processes on something untested. Again though, it could all be done incrementally. Likely to be more cost effective and safer than many "big bang" SAP conversions.
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Don't be fooled, slashdot has many lying astroturfers fraudulently misrepresenting company propaganda as third party opinion. FUD too.
Ever noticed how all the biggest, most successful OSS projects are basic computing infrastructure projects? They're software written by techies, for techies. Things like compilers, operating systems, networking infrastructure, web server platforms, languages, databases. To write these things all you need to know is protocols, fundamental software architectures and how to program. They are areas where competent techie developers have a large amount of 'domain knowledge' - experience and in-depth understanding of the problem at hand.
Open Source doesn't work well when the problem domain is an area that few techie developers have knowledge of. Then you need to bring in experts in the required area of expertise who have the time and motivation to contribute to an Open Source solution. Now this does happen, but it's much rarer. Take my employer. We produce engineering modeling design software for cellular mobile telephone networks. Our development team includes a group of very knowledgeable and experienced radio network engineers who do testig and write specs and requirements, include experts in 3G radio technology of which there are not many in the whole world. Without their contributions over the last decade, our software wouldn't be possible. You see a similar thing happening with computer games, which require a considerable, high-quality contribution of art assets.
Techies have an innate interest in developing technological solutions to problems - if they have an itch it's likely to be a technical one and they are likely to want to develop technical methods of scratching it, which often means software. Artists, radio engineers and specialists from many other disciplines such as accountancy, human resources, etc don't have the same compulsion to develop or contribute towards software based solutions to their problems. It seems to me that corporate integration platforms like those offered by SAP and Oracle fall into the same category. They aren't the sort of problem you average techie is likely to feel any compulsion to solve, and those specialists you'd need to have involved in the development process aren't likely to be interested in doing so. This is where heavy ammounts of corporate funding is required to bridge the gap.
Now of course this doesn't exclude OSS from the party. For example groups of companies could collaborate to fund an OSS solution to their common problem, but these are likely to be competing companies. We're talking about huge investments of cash here, invested over time spans of 5 to 10 years or more. I think OSS will eventualy start to penetrate into these areas as the software industry matures but I expect this will happen over the long term, like my lifetime for example.
Simon Hibbs
I have not much experience with Oracle ERP impelmentations. But my experience of both SAP and Peoplesoft is this:-
It takes more effort and man hours to customise and install these products than is does to write an equivalent system inhouse, and, then you pay license fees.
The main problem is upper IT management are sold on the "we implement best practice you dont have to change anything" idea. Which collides with the
real world of "we dont do it that way here" of the business managers.
The only way to implement these products quickly and cheaply^H^H^H^H^H^H for merely outrageous cost is to implement the vanilla package and change the way the business is run to suit. This usually involves sacking/losing half your business management to force the changes through.
Old COBOL programmers never die. They just code in C.
It takes more effort and man hours to customise and install these products than is does to write an equivalent system inhouse, and, then you pay license fees.
Well, it depends. Look at it this way, management is the customer. Your internal IT group is one vendor, SAP is the other. Does the customer really understand what he wants or needs? Probably not; they're focused on other areas. So as a vendor you need to have a market position -- an "elevator pitch". SAP's is pretty good: "we implement best practice you dont have to change anything". This is garbage to the developer's ears, but music to the customer's ears. What they are saying is the customer doesn't have to become an expert in the IT area, they can stick to their knitting and SAP will take care of the strategic IT direction. Lazy? Maybe. Sometimes Lazy == Efficient; knowing when this is so and not so is not a science.
The next thing on the customer's mind is risk. Can the vendor do it? Well, looking around, pretty clearly a lot of people are have some degree of success with SAP's products. Can the same be said for you? No. While it may not be your fault, clearly the vendor you work for has not solved whatever problem it is to date, so in the customer's mind you're asking for a second chance. Unless you can convince them you're not their father's IT department, forget it. What you need is the one service that as an internal vendor you're not allowed to have: marketing.
The thing that's never on the customer's mind is how much trouble it is for you. If another vendor makes the decision easy, offers apparently lower risk, then the fact it makes your life hell by making highly paid technologists do dull configuration work, well it doesn't matter. The customer would get rid of you if he could, but he can't figure how, so he may as well put you on work he understands, which is underwriting a safe bet.
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
If all of the people that had no experience in implementing or supporting SAP or Oracle ERP systems refrained from responding to this article, it would be very quiet in here.
The fact of the matter is that SAP is a complex beast. I've been working with it, both developing and administering, for about 12 years now. I have no experience with Oracle's ERP product (though I am an Oracle DBA), but I'm sure it's just as sizeable. The issue with most "failed" SAP implementations that I'm aware of, and there have been many, is this - incompetence. Incompetence abounds in the technology industry. It's not isolated to SAP, either. I routinely interview job candidates for Oracle DBA positions, SAP Basis Administration positions, SAP BW Developer positions, and SAP ABAP developer positions. I find one very common thread among the candidates - very few of them know what they're talking about. If you hire them, either as an employee, or as a consultant, and they are the senior technical people on your implementation project, you are bound to fail. Whether it's implementation of the ERP product itself, or an implementation of new functionality. That's not SAP's fault, it's yours.
In the end, the decision to go with Oracle or SAP should be based upon which product fits best in your environment, if either of them do. Interfaces are a significant part of this decision, and both SAP and Oracle have their strengths which need to be evaluated and prioritized. Supportability is, as well. If you are not willing to pay your senior developers and support staff more than $100K per year to maintain the product, then don't bother, you will likely fail. If the evaluation is done well, and the implementation is managed well, and you take care to hire the right people and retain them, then you will succeed.