Agresso Results Show How It Is Making SAP Suffer in Mid-Market

IRVING, TX and VICTORIA, B.C (March 2, 2009) – Agresso announced Tuesday, details from its parent company’s 2008 earnings statement highlighting a significant number of wins or replacements against German Enterprise Resource Planning (ERP) giant and competitor, SAP.

Over the past three years, Agresso has replaced SAP or won against SAP in a competitive bid in 61 deals internationally. The total value of those deals in the earnings statement was €42.1 million ($54.2 million) with an average deal value of €691,000 ($889,000). The largest deal in 2008 with the defense and aerospace organization of Saab, which announced it was to replace all “other ERP” worldwide in favor of Agresso Business World in a project named FIA (Forward in Agresso). This is compared to the average cost of tier I ERP implementations, which in its 2008 ERP report, Panorama Consulting Group cites as almost $17 million. In 2008 alone, Agresso won more than €18.2 million ($23.4 million) in head to head competes or replacements of SAP installations.

In reference to the company’s 2008 earnings announcement on Tuesday, enterprise software industry commentator Dennis Howlett, wrote in his zdnet.com blog: “Of particular interest was a chart that showed the company either won against or replaced SAP in nine deals [in 2008] worth a total of €14 million ($18 million), the largest of which was €5.4 million ($6.9 million). Various reasons were given for these successes but chief among them was [Unit 4 Agresso CEO, Chris Ouwinga’s] assertion that: “Typically these customers can earn back our costs from the maintenance fees they would have paid the competition over a two year period.”

A study* by Technology Evaluation Centers (TEC), conveyed how adaptable various ERP vendors are in addressing change. Comparing the software architecture of leading services sector ERP vendors shows that due to the inflexibility of most ERP software, in-house IT departments don’t have the resource or budgets to pay the necessary external support costs to adapt their systems to support business change. The study compared Agresso with SAP and Oracle. It found that Agresso Business World users can apply more than 92 percent of the required changes to their ERP solution themselves through the graphical user interface. On the other hand, SAP and Oracle require application development conducted by IT staff to support most changes. In today’s competitive market, businesses and public sector organizations are living in a constant state of change. However, most ERP solutions seem to be falling short in accommodating change, leading to higher support costs and impacting business efficiency.

In his blog, A Software Insider’s Point of View, enterprise software analyst Ray Wang asks what vendors are doing to help their clients amidst an economic recession. In the October 12, 2008 posting on “5 Steps to Restoring Trust in the Vendor - Customer Relationship” he claimed that the issue of credibility and trust remains at the forefront of today’s concerns. Wang posed a question to vendors, “What are you doing to make it easier?” One response was Lower cost of usage and ownership. He says “Though tops on the list as a conceptual practice, most vendors will need to roll out such initiatives over the next 24 months. […] notable exceptions include Agresso with its VITA architecture which allows customers to rapidly make business and UI changes…”