Profit Magazine - February 2008

WETTEMANN: A key part of Nucleus Research is to do investigative discussions. We find that having a conversation rather than asking them to answer closed questions allows us to get a lot more qualitative insight on what they did and what they would do differently. We spoke with 56 IT professionals at midsize companies— 27 Oracle customers and 29 SAP customers.

PROFIT: What were the key findings?

WETTEMANN: There were a couple of key things that we found where the results were dramatically different for the two sets of customers. For example, we found that 93 percent of Oracle customers reported a positive ROI [return on investment], while only 41 percent of SAP customers did. The SAP customers found that the scale of ongoing costs and maintenance tended to outweigh the value from the application. To get positive ROI, they would have to either put more work into the application or get more people to use it.

In terms of deployment time, 69 percent of SAP implementations were completed on time, while 78 percent of Oracle [implementations] were—the difference between the numbers is not huge. The more-significant area was budget. 63 percent of the Oracle deployments were on budget, versus 45 percent of the SAP deployments. This is critical in this space, where going over budget can have a significant business impact.

In fact, a number of Oracle customers were actually under-budget. The ones that did go over budget said that they went only ‘slightly over budget.’ Looking at SAP customers, the budget overages ranged from 20 to 100 percent, which sug-

gests two things: Either the SAP customers didn’t realistically scope out their projects, or they were sold a solution that wasn’t a good fit for them. PROFIT: Did anything else intriguing come up? WETTEMANN: We found the recommendation percentages interesting: 66 percent of the SAP respondents would recommend deploying SAP to their peers, while an impressive 89 percent of the Oracle respondents would recommend deploying Oracle products to their peers. This is particularly relevant in this market, which relies heavily on word of mouth and peer recommendations. The research suggests that Oracle has an advantage here over SAP. PROFIT: Where do you think this leaves the two companies moving forward? WETTEMANN: It appears that Oracle is ahead of SAP in terms of providing a quality experience and in setting implementation expectations appropriately. Oracle’s Accelerate program should drive the numbers even higher, as they can provide guidance and support so that customers can get that positive ROI. The real challenge for SAP is to show that it is close enough to the midsize customer to help, but it requires a dramatically different business model than the one that SAP is very successful with: the large enterprise model. <>