Largest IT cost savings hiding in plain sight
Every year, your organisation will explore cost saving initiatives. It’s an integral part to every organisation’s yearly planning. It will usually involve comparing your vendors, analysing the market for new benefits, and ways to make cost savings on aspects such as hosting, security, and hardware.
During this process, there’s likely to be costs that you’ll accidentally overlook. You might miss certain costs during your analysis. Possibly because you’re not aware of them, or because you believe there is nothing to be done about them. A number of organisations lose millions in budget every year on unused software licences, for example.
We guarantee, however, that there is one area where your organisation is losing unnecessary budget, and it can be improved.
We’re talking about Oracle software support costs. It’s possible that the mega-vendor’s fees represent a substantial percentage of your yearly budget. So, why not start your budget analysis there?
Why your support prices aren’t a fixed cost
You might see your Oracle support fees as a fixed cost; they are something that you continue to pay, year after year. You might think they cannot change.
But your Oracle support fees, the perpetual drain on your IT budget, are not fixed. (In fact, if anything, they will only ever increase.) The variable fees are seen as a necessary evil. Something that organisations need to pay just to keep the lights on, to keep moving, or to ‘remain compliant.’
The cost of compliance
On that note, it’s important to settle this particular point. Oracle likes to substantiate the rumour that ‘only vendor-provided support’ for an organisation’s critical systems will maintain that organisation’s compliance in the eyes of regulators. Oracle went so far as to include this idea as a benefit of Oracle Market Driven Support.
It is simply not true. Of course, the vendor would much rather you believe that only it can help you achieve compliance requirements. The truth of the matter is much simpler. Organisations must have their software supported to remain compliant. There needs to be a provider who can supply the necessary legislative and security patches and so on. But that provider doesn’t necessarily have to be the vendor itself.
It could be a third-party provider like Support Revolution, and organisations are realising this is an opportunity. Already, we have supported numerous, largescale organisations in many industries, including highly regulated ones like financial services and government. These organisations have strict compliance regulations to consider. We are more than capable of meeting their requirements with a bespoke service, while lowering their support costs.
For example, we helped one key organisation in British government save over £7 million per annum on its Oracle Support costs. The amount that they have saved is entirely theirs to put back into the organisation. This is what we mean when we say we’re helping organisations ‘invest in their own future.’
If you’d like to see some specific examples, be sure to visit our Customers page.
Still compliant, but cost effective
Oracle would have you believe that vendor-provided support is the only option. That way, you’ll keep handing over hundreds of thousands, if not millions, to the vendor every year.
And that will remain the case for as long as you are on its support model. But you don’t explicitly need your vendor in order to stay safe, secure, and compliant. You can therefore consider an alternative support model.
Ten-year projections: stick with Oracle or move to third-party support?
Stick with Oracle
In this example, your support costs start at 1 million. This cost will continue to rise as time goes on. Oracle applies a 4% annual increase as standard. Then, as you move through Extended Support, the price rises. 10% in the first year, then 20% in the second and third year. This is in addition to the 4% increase.
For as long as you remain on Oracle Support, this cost will not go down. Over the ten years, you’ll be paying nearly 20 million in support fees.
Move to third-party support in Year Five
In this scenario, your organisation makes the strategic decision to move its estate over to our support at the five-year mark. It’s a way of avoiding the Sustaining Support deadline, recouping some of the losses made during Extended Support, or even beginning a longer project to move providers altogether.
Either way, when your organisation moves its estate over to Support Revolution, you can reap the benefit of our cost savings. In this example, we’ve applied our minimum 50% saving (our customers’ average saving is 64%). It is possible that your organisation can save even more.
You might notice our support isn’t a flat cost. We do apply a 3% price increase every three years. But unlike the mega-vendor, we do so in line with standard inflation rates, and not as an effort to improve profit margins.
Start with Support Revolution
Finally, we see what is within the realms of possibility by moving to third-party support early on. The organisation adopts our services in the early stages of its software and sees the same 50% reduction straight away.
You can see how organisations like yours can save much more than just 50% across a ten-year period.
Our support service is not just about making immediate savings but making your organisation future-proof.
Consider the graph above. By year ten, the Oracle-only organisation has spent 19.09 million on its support fees. By comparison, the organisation with us since the start has spent 5.73 million on its support. That is a saving of 13.36 million (or 70%).
What else could your organisation achieve with these kinds of cost savings? It could help pay towards new systems and software, or help towards a refurbishment. You could simply reinvest it back into the organisation. These are the sort of financial windfalls that organisations sticking with Oracle are missing out on.
Helping you achieve IT cost savings
We appreciate the mega-vendors’ extortionate support fees can be overlooked. But once you realise that you have other options, and you realise the savings possibilities, the question then becomes: will you let things stay the same? Will you undergo another five or ten years with the mega-vendor? Or is this the year to make a positive change?
Now that you’ve identified the issue, the next obstacle is overcoming it. Fortunately, we can give you a head start there, too. The next part will include building a business case for third-party support. A document that will demonstrate to the rest of your organisation the benefits of our support service.
And remember the cost savings difference between joining in year one and year five. What your organisation stands to save moving now is substantial.
Start your journey to third-party support today and escape the rising costs.
Download your business case template
