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With the impending closure of SAPs maintenance window for SAP R/3, users may be nervous about the prospect of paying too much for maintenance or, even more drastically, about migrating to the as-yet murky unknown of Oracles Project Fusion alternative.
One things for sure, though: With the growing options for on-demand or software as a service models, customers have a lot more options now, and sticking with legacy software is no longer the given it once was.
As eWEEKs Renee Ferguson reports, under a licensing structure introduced last year dubbed 5-1-2, users on 4.6C and older systems are facing either a maintenance shutout or a potentially significant support fee hike by the end of next year—a deadline thats getting pretty darn close, if youre talking about something as mission-critical as an ERP system.
Many users, faced with impending changes in their system support plan, are upgrading to SAPs newer platforms—Enterprise 4.7 or mySAP 5.0, aka ECC (Enterprise Central Component) 5.0.
But others Ferguson talked to are taking a wait-and-see approach. Oracles entry into the ERP landscape is a big part of that, as it has promised Project Fusion could, within a few years, present intriguing new possibilities for migrating off of SAP.
So users at this point have a number of options. They can decide to resist temptation to sign up for more expensive maintenance fees and just go ahead and support themselves.
SAP is desperately hoping they dont choose that option, of course—after all, what vendor wants to have a dead piece of software hanging around their neck forever?
Then again, users could rethink their overall ERP strategy.
With the advent of Web services or on-demand technologies, some companies might well decide to scale back on their existing in-house IT software resources, noted Albert Pang, an IDC analyst.
“Make no mistake about it,” Pang said, “theres intrinsic value that some of the legacy systems can provide to these users. But above and beyond that, a lot of customers might feel, Well, does it make sense to continue to get into this big ball of wax, compared with a smaller implementation, or compared with Web-based type of deliveries, and other software and services available to them?”
At this point, ERP customers should be debating the pros and cons of running these monstrous systems behind their own firewalls.
If youre looking at procurement technologies, you dont have to keep using SAP products for that. As long as you find ways to maintain accounting and interfaces to the back end, or the management functions, then on the front end you can use any one of the best-in-breed solutions or on-demand services to do strategic sourcing, contract management or employee self-service, for example, Pang said.
“I dont think thats such a cut-and-dried situation where a company has no choice but to continue to invest in their legacy systems,” he said.
There are two things happening that are influencing the opening of choice for ERP customers.
First, is the affects of globalization, which forces companies to push a tremendous amount of capital into keeping legacy systems running on a global basis.
Second, even with the existing systems out there, there are just so many pockets of the world that a legacy ERP system or R/3 system can support.
The more globalized a company becomes, the greater the need there is to leverage the Internet, either with software as services or with on-demand models.
Payroll support differs both by country and by region, for example. Doesnt it make sense to outsource to a service provider so all you need to do is to make a connection at the metadata level?
SAP may well come up with alternative methods for customers to get the support they need to keep their R/3 and other legacy systems running. It will be expensive, but its not impossible.
But given that there are so many options available, and there are so many technologies and service providers that can take up the slack, shouldnt it be high time to recheck the technology roadmap?
Enterprises can start by looking at the gaps that exist: gaps such as different localization support, different payroll processing requirements, different supply chain-related types of business processes.
All of these things are changing before our very eyes. Just look at what UPS can do nowadays: The company can set up a warehouse all over the world.
Why would you want to keep running your own warehouse applications? The same applies to e-recruiting or to payroll processing. These all used to be under the domain of the legacy applications, but thats no longer the case.
Legacy systems arent going anywhere. But their role most certainly is evolving, and not much can—or should—be taken for granted anymore.
Lisa Vaas is Ziff Davis Internets news editor in charge of operations. She is also the editor of eWEEK.coms Database and Business Intelligence topic center. She has been with eWEEK and eWEEK.com since 1995, most recently covering enterprise applications and database technology. She can be reached at lisa_vaas@ziffdavis.com.