BDP International is saving hundreds of thousands of dollars a year in maintenance costs for its Oracle database software after switching to a third-party vendor that many CIOs are also turning to trim their support bills. The logistics company’s decision followed close scrutiny of its existing contract with Oracle, as well as the backing of the CIO and the rest of the C-suite, says Jason Bullock, BDP's executive director, IT Global Infrastructure and Support.
“We took the money that we had budgeted for Oracle support and were able to leverage that to help us build new customer-focused applications to keep our existing clients happy and attract new customers," Bullock says.
CIOs, perennially under pressure to do more with essentially static budgets, have long been chafing over paying Oracle, SAP, Microsoft and IBM for maintenance for what they say are largely incremental software updates and help-desk services. "Many CIOs are desperate to reduce the amount of maintenance they pay to big software companies, which they regard as over-priced for the value they deliver," says Duncan Jones, a Forrester Research analyst who researches vendor management issues.
Rimini Street paved with cost savings for CIOs
BDP, along with 1,270 Oracle and SAP customers, have found solace in Rimini Street, which offers software support for between 50 percent and 60 percent what the incumbents charge. The startup has helped customers such as paint provider Valspar, Dean Foods and the American Cancer Society significantly reduce support costs.
When Bullock joined BDP in 2012 he assumed responsibility for the company's database software, which fed data to a critical logistics application that helps customers track goods. But after speaking with the IT staff and assessing BDP's Oracle contract, Bullock questioned whether he needed to keep paying Oracle $650,000 for help resolving support issues. The company was no longer making significant changes to the back-end development of its customer-facing logistics apps, called BDP Smart and BDP Smart Mobile, which had matured enough to essentially require nothing but feature updates on the front-end.
Bullock discovered that he had inherited a vexing Oracle contract. Soon after conducting routine performance tuning at BDP in 2011, Oracle sent BDP a bill and a notice that the company was using more software than it paid for. Bullock, who learned of the sequence of events from his staff and by reviewing documents, says that Oracle was counting database consumption for developer tests and quality assurance that shouldn't have counted as software running in production, per the contract. "Oracle did not make a whole of friends at the executive level when they did an audit in disguise and they presented us with a discrepancy and a bill," Bullock says. "Folks here didn't know that they can push back [against Oracle] on that."
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