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Software's Sublimation by Alex Goldman (bio)

Data's diffusion throughout business and into the cloud



SOA exec criticizes SAP, Oracle ERP front ends

By Alex Goldman on May 19, 2009 8:35 AM

You cannot call Fiorano software a startup, since the company was founded in 1995, but Atul Saini, its founder, CEO, and CTO certainly talks like an old school Silicon Valley purveyor of disruptive technology.

He told InternetNews.com that ERP vendors and their ecosystems hate his company's software, which makes systems like SAP more intuitive and Web-based. "Consulting companies love having people do manual work that they can charge for by the hour. They don't like us to break their business model," he said.

His comments came shortly after the release of a report by Accenture that found that many companies in the U.S. and UK underutilize their ERP software. About half told Accenture that they don't need all the capabilities while a fifth explained that they didn't make use of all the functionality due to lack of time to learn how to apply them.

23 percent of U.S. companies reported successfully integrating their applications with their customers.

Perhaps the problem is the surprising complexity in software of even the simplest operations on paper.

Take SAP invoicing. In a case study presented on the company Web site, Saini said that one company used to require 12 minutes and 9 screens per invoice. With Fiorano, it reduces that to 2 screens and 2 minutes and the second screen is simply the confirmation screen.

Since UDV India (United Distillers & Vintners) does over 10,000 invoices per month, the time saved is worth 200 man days per month and $750,000 per year in payment processing, said Saini.

He added that the company also saves on SAP licensing. Whereas in the past everyone who touched an invoice in the field needed SAP training and a SAP license -- and the license alone costs $2,000 -- he said that now only those at the head office need the license. The rest interact with SAP through Fiorano's Web interface.

SAP license prices are an issue. Sources at another company that is part of the SAP ecosystem told InternetNews.com that there is a market for providing support to older versions of SAP software that SAP itself no longer supports.

But companies could be paying even more to consulting firms. "Consulting companies don't like tools that are efficient," said Saini. "Saudi ARAMCO spent over $1 billion on consulting. There are 500 Accenture people in there."

Saini said that companies don't just dislike SAP's pricing, they also dislike the rigidity of its process. In another case study he said that his company designed asset management software when it found managers using paper to track purchase orders.

That's because with each purchase order, the system would allocate some of the inventory and if someone wanted to sell something late in the day, the system might tell them that there was no inventory available for the order and refuse it. "So SAP customers weren't entering orders until the end of the day. With Fiorano, the data flows into a temporary database, including prioritization of orders, which are then entered into SAP in the proper priority whenever the customer is ready."

Saini did admit that SAP does some things well. "SAP's APIs and databases are very good. SAP is a very good system for holding enterprise data. It holds all of the production data, supplier data, how much inventory is used every day in a very large database with the data organized a certin way."

He said, however, that SAP is not flexible. "It's okay if you do it their way; it's difficult if you want to change."

Customers have become experts at using the system, he said. "People learn to work around the nuances of the system. SAP has many nuances. It's painful to use, and often the craziness of the pain is not exposed. The pain is unknown outside the SAP community."

He added that Oracle is only slightly more customizable than SAP but admitted that those customers that are using BEA and not the rest of Oracle are happy. But BEA is not the foundation of Oracle's SOA strategy, he said. The foundation is a technology acquired with Collaxa in 2004 called BPEL (Business Process Execution Language). In 2006, BPEL became the foundation of Oracle's SOA Integration Suite. Then, in 2008, Oracle acquired BEA.

"None of these products talk together," said Saini. "It will take 3 or 4 years to integrate their middleware. They need that much time to make their middleware cohesive."

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3 Comments

carygson said:

How come consultants get the blame for not solving SAP's problems? Consultants don't want to use efficient software? Get out there and make your case more strongly. Don't blame others for your inability to sell your products! If it's good, people will buy it!

May 21, 2009 1:17 PM
Lynton Grice said:

Hi there,

I tend to disagree strongly with the one comment above from "carygson"

The comment went: "Don't blame others for your inability to sell your products! If it's good, people will buy it!"

I have been in the SAP integration game for a number of years dealing primarily with SAP XI / PI and all the other technical things like SAP Worlflow etc. This is my current daily job.

You guys need to TRY FIORANO...it is OUTSTANDING....so this comment of "if it is good"....it is not good, it is BRILLIANT!

August 7, 2009 6:26 AM
Nic Harvard said:

I completely agree with Atul and completely disagree with carygson.

I have seen many large SI partners STRONGLY resist many small, easily implemented solutions that drive down TCO for the end customer, simply because the major part of the costs they cut are consulting days from the SI/VAR.

The culprits here are not the software VENDORS - their consulting arms are rewarded for making the core business easier, better, faster (Core business being the software the ERP vendor makes, supports, and sells.
It's the partner consulting networks who have benches of thousands of expensive consultants they need to keep employed, who are the culprits here.

August 11, 2009 10:36 AM

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