Oracle Vs SAP ERPs

(case study)
Contents:

 Introduction
 ERP Software Market
 SAP
 Oracle
 Market Analysis
 Payback
 Strategies
 SAP vs Oracle
Introduction :

An Enterprise Resource Planning System ,

commonly known as an ERP System, is a set of
Business Software tools designed to facilitate
the flow of information between all the
Departments or Functions within a business.
Major ERP Suppliers

The top Five ERP Vendors :

1. SAP
2. Oracle Corporation
3. PeopleSoft Inc.
4. JD Edwards & company
5. Baan International
ERP Software Market Segmentation and Scope

 By Deployment
1. On-premise deployment
2. Cloud deployment
 By Functions
1. Finance
2. Human resource (HR)
3. Supply chain
4. Others
 By Verticals
1. Manufacturing & Services
2. BFSI
3. Healthcare
4. Retail
5. Government Utilities
6. Aerospace and defense
7. Telecom
8. Others
 By End User
1. Large enterprises
2. Medium enterprises
3. Small enterprises

 By Geography
1. North America
2. Europe
3. APAC(Asia-Pacific)
SAP(Systems, Applications, Products in
data processing)
 In 1972 five IBM engineers Hopp, Wellenreuther, Hector,
Tschira and Plattner founded the company called System
Analysis and Program Development(SAP).
 SAP is the fourth largest enterprise software company in the
world.
 SAP systems provides end to end solution for manufacturing ,
financing and costing logistics etc.
 SAP competitors are Microsoft Dynamics, Oracle etc.
Oracle
SAP Vs Oracle ERPs
Market Analysis
Payback Period:
ERP sector analysis in 2010

 ERP sector highly radical, competitive and changing at very fast pace.
 Led by two companies
(i) SAP
(ii) Oracle
 Focus to provide best products and services to their customers
 Quality , customizable and easy to use applications at a low and
reasonable price.
 Entry barriers due to economics of scale and learning curve of current
firms.
SAP Strategy

 To continue expanding into the small and mid-sized business

market.
 To focus on partnering with companies instead of acquiring
Example: partnership with oracle.
 Great customer services and support.
 Training students at colleges and universities and making them
aware of the varying jobs and carrier in the market.
 To enhance its technology solutions for ERP systems--- ERP
applications on cell phones.
Oracle Strategy

 To acquire companies with expertise in specific industry areas

 Acquisition of Sun Microsystems – better cloud computing and
virtualization capabilities
 To simplify its architecture and compete on user friendliness
 To develop applications that require less training and lower priced
than competitors
 Focus on customer service and support
 To enhance its technology solutions of ERP systems.
SAP vs Oracle

 Companies prefer SAP because they believe that:

I. SAP is committed to research and design.
II. SAP provides high level of customer service and functionality with a high degree of
application customization.
III. SAP is capable of operating with other products such as databases.
IV. SAP is able to deliver better vision and proposal for its application by not relying
on the other companies as much.
Contd...

 Those in favor of Oracle believes that :

I. Oracle is easy to use and more flexible.
II. Oracle’s ability to quick deployment of its application as they don’t stress on
customization.
III. The above two reasons make positive ROI to occur faster.
IV. SAP requires main four times internal resources and twice the spending on training
than oracle.
V. As oracle is coming up with its Fusion Applications it would prove beneficial to be
used with its own database
Oligopoly

 An oligopoly is a market from in which a market is dominated by a

small number of sellers
 Here SAP and Oracle are two major firms competing against each
other
 Oligopolies can result in collusion which reduce competition and
lead to higher costs for consumers.
 Decisions of one firm therefore influence and are influenced and
are influenced by the decisions of other firms.
Analysis-

 SAP’s focus on small and medium sized business and on partnering instead of
acquiring has helped it gain the edge over Oracle.
 Its policy of great customer service and support has paid off fro the company.
 Due to the higher complexity and degree of customization SAP proves to be a
costlier affair than oracle which goes in favor of oracle.
 Oracle with the launch of its fusion application can penetrate in the ERP market.
 Even though these two companies are fierce competitors in the ERP domain, they
co-operate each other when it comes to customer to customer service and
support for their complimentary products.
 They compete on product differentiation and service rather than prices.
“ "The old battle between SAP and Oracle is
kind of being fought to a draw , The real
battle is the old guys vs. the new guys, and
every indication is the new guys are winning.

says analyst Frank Scavo, president of consulting firm Strativa.

”