2.Conduct research on an ERP package other
than SAP that would be suitable for a large organization (>Php 1
billion in revenue) and compare the
modules that it has to SAP modules.
As our ERP research has shown,
both SAP and Oracle eBusiness Suite (EBS) have strengths, weaknesses, and
tradeoffs. Different clients have different needs, ranging from functional
requirements, technical maturity, tolerance for risk, budget, and a host of
other factors. The vast differences between these two ERP solutions are
underscored by the fact that we often recommend different solutions for
different clients in the exact same industry.
So what are the differences
between these two solutions? Although there are numerous variances in the
detailed workflows and functionality of the solutions, there are five key
high-level variables to consider when evaluating SAP and Oracle EBS:
Best of breed
functionality vs. more tightly integrated modules. The software strategy of the two vendors could
not be much different. While SAP has built a solution primarily from the ground
up, Oracle has grown primarily through
acquisition of best-of-breed point solutions. For example, Oracle has acquired
Demantra for advanced sales and operations planning, Hyperion for financial
reporting, and Siebel for CRM, while SAP has built much of this functionality
into its core ECC and All In One ERP solutions.
Product roadmap. SAP continues to build upon and enhance its core
product offering, while Oracle is moving toward Fusion. While some may suggest
that Oracle is more innovative or visionary in its technology direction, it
also means that there may be more uncertainty with Oracle’s product lines. This
is especially true for clients considering Oracle’s JD Edwards and PeopleSoft
solutions.
Flexibility. Although very powerful, SAP can be more
difficult to change as a business evolves. This is both a strength and a
weakness: it is tightly integrated and helps enforce standardized business
processes across an enterprise, but it can be more difficult to modify the
software to adjust to evolutions to core processes and requirements. Oracle’s
best of breed approach, on the other hand, can allow for more flexibility to
accommodate changing business needs, but this strength can become a weakness
when it becomes harder to enforce standardized processes across a larger
organization.
Implementation cost, duration, and
risk. Although both solutions
typically cost more and take longer to implement than most Tier II ERP
software, there are distinct differences between the two. Oracle has a slight
advantage in average implementation duration and an even larger advantage in
average implementation cost, at 20% less than SAP. SAP, on the other hand, has
the lowest business risk of the two, measured via the probability of a material
operational disruption at the time of go-live.
Business benefits and satisfaction. This is perhaps SAP’s greatest strength.
Although Oracle has the highest executive satisfaction level of all ERP vendors
included in our 2008 ERP Study of 1,300 implementations across the globe, SAP
leads the pack in actual business benefits realized. Assuming the #1 reason
most companies implement ERP software is to achieve tangible business benefits,
this can be enough to justify SAP as a solid solution for many companies.
The key takeaway here is that, as
with any ERP solution, SAP and Oracle both have their strengths and weaknesses.
One solution may be the best fit for one organization, while not a good fit for
others, even within the same industry. The only way to make sense of the pros
and cons in a way that is meaningful to your organization is to engage in a
robust ERP software selection process that considers your requirements,
priorities, and competitive advantages to find the right fit.