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Oracle turns tables on SAP in ERP battle

Thursday, December 4, 2008
Oracle turns tables on SAP in ERP battle
By: Thomas Wailgum - CIO.com(NA)  (18 Nov 2008)

 

Forrester Research explains why Oracle's next-generation Fusion Applications bested SAP's ERP strategy

Forrester Research last stacked up the application strategies of ERP heavyweights SAP and Oracle in 2006.

Back then, Forrester analysts noted that both business apps vendors had just launched new architectures for a new generation of service-oriented and flexible enterprise applications.
SAP's star, in their opinion, was shining much brighter than Oracle's at the time. "SAP was riding high, having kicked into high gear its transition to applications based on the NetWeaver platform ," according to Forrester, "while Oracle was still digesting PeopleSoft and figuring out exactly what its Oracle Fusion Applications were to become."

The clear victor of the "battle of the architectures," as Forrester termed it, was SAP: It had a larger market presence in applications than Oracle did, plus faster growth. SAP had been able to capitalize on Oracle uncertainty, and it was able to articulate a clearer vision for enterprise applications, the Forrester analysts wrote.

Much has changed since then. Now, as 2008 comes to a close, Forrester analysts John Rymer, Paul Hamerman and Ray Wang have done another comprehensive analysis of the fierce competitors' application strategies. The report, "Which Has The Better Apps Strategy: Oracle Or SAP?", compares the merits of Oracle's next-generation applications play-Fusion Applications-with SAP's inclusive strategy that seeks to minimize disruptions to large organizations.

This time around, Forrester's nod goes to Oracle. "Oracle's vision for the future of its apps business is now clearer and more compelling than that of archrival SAP," write the analysts. The head-to-head analysis looks at many important areas, including: market penetration, vision for next generation, partnership strategy, middleware and tools, support for openness and standards, industry applications strategy and midmarket strategy. While Oracle doesn't win out in all of those areas, the analysts proclaim Oracle's overall strategy as better than SAP's plan.

However, as the analysts point out, Oracle's "biggest test is yet to come-it must deliver the Oracle Fusion Applications system with its associated promises of better flexibility and lower cost of ownership and do it within the next two years to keep the upper hand in apps innovation." (Many expected Fusion to be delivered by 2008, but it now seems like the suite will arrive in 2010, according to Oracle's most recent promises.)

But Fusion needs to arrive not only soon but also in good form. The analysts state that "if Oracle Fusion Applications fall flat, SAP wins by forfeit."


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