BOSTON, MA – October 17, 2017 – Most large companies have implemented ERP systems that help run their businesses and they’re often caught off-guard regarding their risk due to an audit. While SAP Indirect Access risk exposure varies greatly based on a company’s size and the intricacies of their IT environment, there is no denying that Indirect Access fees can be gargantuan.
Based upon analysis conducted on application landscapes for a broad range of organizations and industries, Indirect Access risk assessments performed by UpperEdge revealed an average net license fee exposure ranging from $800K to $2.5M (excluding maintenance).
Like SAP, Oracle has increasingly become more aggressive with their auditing and enforcement of non-compliance issues. The trend among these vendors suggests attempts to lock-in customers by making it arduous and costly to use applications from other companies. Oracle – with the purchases of PeopleSoft, JD Edwards, Siebel, Hyperion, NetSuite, etc.; and SAP – with acquisitions of Ariba, SuccessFactors, FieldGlass, Concur, among many others, instead prefer to be its customer’s one-stop-shop.
”Efforts like Oracle’s ‘Total Support Stream’ clause are one way these large IT suppliers are tightening the screws,” said Dave Blake, UpperEdge Founder and CEO.
“This verbiage can easily be overlooked in a large agreement but it successfully binds ALL past, present and potential future support streams together making it impossible for customers to terminate any of the individual areas of support without canceling the entire Total Support Stream,” Dave continued.
Other indicators of potential lock-in attempts:
· SAP’s excessive Indirect Access fees and recent litigations encourage companies to hesitate or even avoid using non-SAP applications.
· Once a customer subscribes to Oracle’s three major product silos (ERP, HR, and CRM), the price hike for maintaining ERP, for example, could be substantial enough to make switching HR or CRM systems cost prohibitive.
· SAP and Oracle have not clearly defined non-compliance events or how to avoid them, causing anxiety for companies considering outside solutions.
Since there is both uncertainty and steep financial risk tied to unintentional Indirect Access and other non-compliance violations, it is critical for companies to understand and proactively mitigate their risk exposure.
In response to this growing need, UpperEdge developed two web-based tools for SAP and Oracle customers to gauge their risk of being non-compliant. These tools provide customers a proactive glimpse of their related potential financial exposure. These risk assessments can be completed in under 10 minutes resulting in a report based on a proprietary algorithm provided directly to the user’s email address. The SAP Indirect Access Risk Assessment can be found here and the Oracle Audit Risk Assessment can be accessed here.
UpperEdge maximizes the value its clients receive from their key IT supplier relationships by helping them develop and execute to fact-based sourcing, negotiation, and program execution strategies. Visit https://upperedge.com/ for more information.