An ERP Vendor Soap Opera: A Close Look at SAP's Purchase (and Attempt to Sell Off) TomorrowNow
When SAP acquired cut-rate ERP service provider TomorrowNow, observers scratched their heads. How would the two work together? Then Oracle sued, alleging stolen information. SAP isn't waiting for its court date. It's ready to entertain buyers for TomorrowNow.
According to AMR’s Richardson, the e-mail was most likely a proactive safeguard for SAP to legally ensure that there was “no Oracle code on TomorrowNow computers.” In addition, now that TomorrowNow was for sale, it showed potential suitors that TomorrowNow was complying with best practices and there weren’t any more “sloppy policies.”
Forrester’s Wang reports that he has received lots of client inquiries from TomorrowNow customers who had received a letter from TomorrowNow that gave customers a 60-day window to cancel their contracts and now wanted to know why this was happening. “At some point, we figured there would be a change in management,” Wang says.
With so much uncertainty at SAP as to what executives plan to do with TomorrowNow, harried IT executives have been left to explore their options. And, there, waiting in the wings with open arms, has been Rimini Street.
CEO Ravin says that the company has seen a noticeable increase in potential customer calls since SAP’s announcement. “We’re seeing now that most customers are uncertain as to what SAP’s intentions are,” says Ravin. “This has sent a shockwave through TomorrowNow’s customer base, and certainly [SAP’s] lack of strategic plan caught them off guard.” Forrester’s Wang has advised his clients to look at other options, which include Rimini Street.
Ravin has not talked with his former cofounder Nelson “in a long time,” he says. “I know this has not been an easy year for him.”
Of course, the lingering question—whether Rimini Street would buy TomorrowNow outright or simply let its disenchanted customer base stream over—is one that Ravin says he’s considering. “Putting themselves in play is an interesting thing to do,” Ravin says. “Are we interested? Yes, we are. But we would have to understand what the value proposition is if the customer will be coming anyway. What exactly are we buying?”
Is It the Business Unit or the Business Model?
For now, TomorrowNow’s new chief, Mark White, is planning on supporting current customers through the management transition. “SAP is prepared to manage through these changes to ensure that TomorrowNow’s obligations to its current customers are met,” he said in the press release.
When contacted via e-mail, Andy Kendzie, an SAP Americas spokesman, said that SAP and TomorrowNow executives can’t talk about what’s going on. “As we are still in ongoing litigation, our policy prohibits us from saying much beyond what is contained in the filings and statements,” he wrote.
A lingering question remains, however, for CIOs and TomorrowNow and Rimini Street executives: Is all that has happened to TomorrowNow a one-time transgression or an indicator of more legal troubles to come in the third-party software maintenance business?



