The profit is in the purchase, according to an old saying from the retail industry. If only we were in such a comfortable situation, many CIOs will think. Even today, the bargaining power of the big software manufacturers such as Microsoft, SAP, and Oracle still seems overwhelming.
Their ERP solutions represent the beating heart of company value creation in the form of data and processes. Managers who have spent a large part of their IT budget buying and especially customising ERP standard software create an optimal solution for their company.
However, the downside is increasing maintenance costs – support for (mostly large-scale) customisations extends far beyond the standard maintenance services provided by the manufacturer – and the resulting limited potential for investment in innovation.
Manufacturer margins versus customer innovation
This situation was what drove the experienced software manager Seth Ravin to start Rimini Street in 2005. Customers would be able to maintain and optimise their company solutions with the manufacturer-independent software maintenance and support services provided by Rimini Street.
At the same time, they would have more money in their pocket to invest in real innovations without having to constantly and substantially raise their IT budgets. What at first glance seems like trying to square the circle, is in reality the result of sober analysis.
Based on SAP’s annual report, Seth Ravin recognised that support and maintenance services generated a large share of the profits. Such profit margins are only possible in the software industry (see also the Gartner chart on the next page).
That is why he promised his first customers and interested parties “cost-efficient, premium support for ERP premium systems”. Since then, he has kept his promise to just under a thousand customers – 50 per cent lower maintenance costs in the first year, and savings of up to 90 per cent for maintenance and support over a period of ten years. Of course, for tax reasons, no company system can stand completely still for ten years. This is why Rimini Street provides the latest taxation, legal and regulatory adjustments as part of its services, keeping the SAP and Oracle applications of customers in these fields continuously updated.
Rimini Street provides its customers in some 200 countries with countless customer-specific updates, in most cases before the official update from the relevant provider is released.
Premium service for all SAP customers
With its experienced team of SAP experts – each with an average of 15 years experience in SAP development, implementation and systems management – Rimini Street provides SAP users with first-class support for all modules that are part of the R/3 and ECC releases of SAP.
Each Rimini Street customer is assigned a “Primary Support Engineer” (PSE), a direct contact who will respond to any high-priority support query within thirty minutes – often in less than five minutes. These PSEs work closely with a team of SAP experts in order to provide, if necessary, fixes and updates for important SAP applications, and to create personalised software. Customers can expect this high-quality service for priority one and priority two enquiries 24 hours a day, 365 days a year.
More than 1,000 signed maintenance agreements
The success of this idea over the last ten years has been infectious. By now, some 1,000 companies of various sizes, and from the most diverse industries worldwide, have come to rely on the maintenance and support services provided by Rimini Street. Almost 500 employees – German corporate customers are supported by the Munich branch – provide a level of service that is oriented towards the premium support of manufacturers such as SAP and Oracle.
This means that Rimini Street does not just maintain the manufacturer’s standard product, but all the individual customisations in the customer’s system as well. In the 2014 business year, the company achieved worldwide revenues of over 86 million U.S. dollars. This represented an increase in sales of over 42 per cent compared to the previous year.