Vinci Energies CTO Julien Viala has described how the utilities, energy, transport and infrastructure maintenance and support company has been able to consolidate expensive Oracle and SAP support fees to free up IT budget to invest in strategic digital projects.
A division of Vinci, the French construction company which employs over 179,000 and is the largest construction company in the world by revenue, Viala joined Vinci Energies from Cegelec where he was IT director as part of a merger in July 2011 and was charged with rationalising its IT and in particular its ERP estate.
“We needed to decide whether to keep SAP or Oracle,” Viala said at last week’s Gartner Symposium in Barcelona. “The goal was to reduce costs and consolidate on SAP.”
Viala said that in 2015 at the end of a multi-year Oracle support contract, the organisation did something it had never done previously and look for alternative third-party companies to provide support. Vinci Energies chose Rimini Street as its provider having previously been wary of a third-party vendor, but said that the organisation had not looked back since.
“We had the opportunity to validate Rimini Street and see if independent support could be valid in our environment,” Viala said.
“It was attractive that we could pay half the price, but it’s the other points we encountered on execution which were more important. Rimini Street did not ask us to pay more to have a dedicated person on the account, we experienced faster resolution. And they don’t care about if it is on your base code or standard code; they just see a problem and resolve it.
“It has freed up funds and resources for strategic projects, people from the organisation can move to the fun part and stop working on fixing things.
“We have been able to consolidate on SAP and invest in digital initiatives, as well as in analytics, BI, mobile, cloud, Big Data and collaboration tools. We are investing the savings to innovate around of the edge of the digital systems.”
While the savings were a boon to Viala and Vinci Energies, the CTO said that executives needed to think take a case-by-case look at suppliers and the alternatives, and think beyond cost-cutting to the true value of the service CIO customers were receiving. With another multi-year SAP contract also set to expire, Viala said that Vinci Energies would almost certainly be looking at Rimini Street and other independent support providers.
Rimini Street President Sebastian Grady said that the company’s resolved legal dispute with Oracle regarding copyright infringement had been “put behind us” and was looking forward to focusing on its customers. Indeed, Rimini Street was announcing quarterly earnings and had been set to IPO on the New York Stock Exchange before the litigation with Oracle, and a recent press release reaffirmed that this was back on the agenda for 2017.
“We wrote a cheque for $124 million all-in,” Grady said. “We feel very happy to have put it behind us.”
As part of the ruling in the case with Oracle the jury found that Rimini Street did not willfully infringe Oracle’s software copyrights and found all infringements to be innocent – while confirming third-party support for Oracle products was lawful.
With 1,600 customers globally and 300 in Europe, Grady said that as CEO and CIO focuses shift towards digitisation and a relentless focus on the customer, by consolidating on support organisations could turn their attentions to driving revenue during a period of budgetary constraints.
“We think we are a bit of a disruptive technology; we are maniacally focused on our customer satisfaction ratings,” Grady said.
“CEOs are really focused on customer experience transformation. CIOs are revenue generators; driving revenue is definitely the best place to be if you are a CIO – CEOs are looking for CIOs that can do that, and we can free up a huge amount of your IT budget.”
Managing director of Rimini Street Europe, Jill Harrison, added: “We have had significant growth throughout Europe as CIOs continue to recognise the importance of shifting investment from maintenance to digitalisation for their companies’ future.
“Our conversations with CIOs are focused on how they can liberate funds and free up resource for more strategic programs that will really make a difference for their business.”
President of Rimini Street Grady added that despite uncertain market conditions, organisations like Vinci Energies show that by making savings in operational IT there are huge opportunities for CIOs and CTOs to invest in revenue-driving technology.
“Game-changing CIOs prove to me that despite the budget struggle there has never been a better time to be a CIO,” he said. “With a digital and customer-focused mindset, companies are investing in CIOs to contribute so much more than operational IT. CIOs are transforming business and driving revenue more than ever before.”