Competing with SAP using Agile PLM
Gary Goldhawk, VP Agile PLM Sales West Region Jay Graver, Solution Specialist, Agile PLM Safe Harbor Statement The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decision. The development, release, and timing of any features or functionality described for Oracles products remains at the sole discretion of Oracle.
Agenda Strategies to Compete How we beat SAP Agile Differentiation Agile Momentum in SAP Accounts Analyst Remarks How SAP Positions Neutralizing Objections Beating SAP at AMO Key Takeaways Q& A How We Win Strong Business Sponsor 1 Functional Superiority 2
Business needs to overcome objections of IT Build momentum, confidence of business owners before IT gets too involved 1 Functional Superiority Require detailed use case demonstrations Include as many PLM business processes as possible 2 Customer References Make multiple industry references mandatory Educate customer/prospect to dig into specific details 3 Domain Expertise Establish PLM and industry credibility early Leverage industry specific resources 4 d Neutralize SAPs Relationship with IT Leverage any existing Oracle applications/technology footprint Reference Agiles presence and success with other SAP customers 5 Agile Differentiation Summary
Differentiator Agile SAP PLM Industry Leadership Strong PLM Presence PLM market & thought leader in EHT, Life Sciences, CPG Deeper focus & presence in fewer verticals ERP Centric ERP Customers positioned as PLM Customers Ships SAP PLM with SAP Business Suite Broad Business-Ready Applications Complete, Modular Solution Configurable Business-Ready Applications Broadest PLM Solution Footprint User friendly Un-integrated, Disjointed Solution Array of R/3 technology mixed with Netweaver composite applications;customization required Limited functionality ie)collaboration, etc. Domain Expertise & Best Practices Strong PLM Depth Deep domain expertise across engineering AND enterprise function Industry best practice product lines & apps Limited PLM Experience Weak in Engineering Little PLM domain experience Product Network Built & Proven Proven, Heritage Built for collaboration across enterprise & product network 100s of live product network customers Dynamic security model Weak cFolders not well designed for collaboration with suppliers Few collaboration references Custom security model Customer Success 10x Customer References Best PLM customer success track record Fastest TTV, lower TCO, lower risk Examples of SAP PLM replacements Limited Very few references in North America Most can be neutralized DATA CENTRIC Data management core to spend intelligence Over 24 million records per quarter are cleansed, categorized and enriched INTEGRATED Only solution that integrates hospital purchase order history with contracts across all purchases.Integrated not enough to clean your item file.Match to your contracts and in the future match to other systems like the charge master where you can track original price to reimburseable price. TRUSTED Independent, provider-focused third-party providing unbiased view of supply spend.Also -- guaranteed data protection PROVIDER EXPERIENCE 23 medical professionals including physicians, RNs, pharmacist, DMM and purchasing personnel with GPO and member business process experience TECHNOLOGY LEADER Scalable processes, automated tools & technical infrastructure; CHeS Board Member and Contributing Editor in development of UNSPSC 41 & 42 segments Agile Differentiation: Industry Leadership
SAP EHT/Semi Dominant market leader across large enterprise & SME; owns key EHT segments 850+ PLM customers 100+ new SME customers Competes within their install base, but has yet to beat out Agile in head to head Agile has several new customer wins in Semiconductor Life Sciences Market share leader in Life Sciences across large enterprise & SME 160+ PLM customers 50+ new SME customers (last 2 yrs) Some presence in pharmaceuticals Little PLM presence in discrete manufacturing Consumer Packaged Goods Early leader in largest un-penetrated market -food & beverage Focused on food & beverage, health & beauty aids, household goods, private label retail Makes strong showing in CPG, but has significant gaps in product line around recipe and formula management Automotive & Industrial Emerging leader in fastest growing segments Automotive & Defense Electronics Making play with IPPE vision Competing with Dassault and UGS for big OEMs Agile Differentiation: Product Superiority
SAP PLM Business Ready Applications Configurable business-ready applications Configuration vs. customization approach with built in best practices Takes 3 screens to change a part Combination of R/3 technology + Netweaver xApps Not user friendly High degree of customization Takes 28 screens to change a part Time to Benefit 16-20 weeks for typical phase 1 deployment Higher licensing cost, but lower overall cost of ownership month deployments Lower licensing cost, but high services requirement Enterprise PLM Solution Footprint PDM, Supply Chain Collaboration, Quality, Compliance, Cost Management, Multi-CAD Engineering, Product Portfolio Management, Analytics Missing Supply Chain, Product Portfolio Mgmt, Formula Mgmt, Product Quality Adoption High level of adoption across extended enterprise Engineering, Operations, Quality, Supply Chain partners Limited Engineering and Supply Chain presence Example Agile Wins vs. SAP Agile Momentum in SAP Install Base
Philips Medical recently chose Agile vs. SAP, separately in the U.S. & Europe, due to Agile speed to implement, OOTB solution capabilities, and ease of use Large SAP customer chose Agile due to domain expertise, completeness of PLM solution for food & beverage, zero footprint client, and lowest TCO Consumer electronics & innovation leader chose Agile vs. SAP due to functionality superiority, ease of use, speed of deployment & proven track record Agile selected to manage product portfolio processes at leading semiconductor company vs. competition due to time to benefit & out-of-the-box solution capabilities Analyst Remarks Gartner's life science clients have praised Agile for its deep understanding of PLM needs of life sciences, and its support of Title 21 Code of Federal Regulations (21 CFR) Part 11 requirements out of the box. Most recently, Agile's acquisition of Prodika gave it comprehensive capabilities for recipe/formula management, supply chain collaboration, and regulatory compliance among producers of consumable packaged goods. - Gartner Industry Report,Nov. 2006 Agile stronger in EHT and Life Sciences - Medical Products Agile and SAP on short-list in Life Sciences Pharmaceuticals, CPG Hersheys project scope did not include master or control recipes, process instructions, or equipment specifications, which still remain in its legacy applications.Hershey also customized nutritional labeling, and avoided workflow which the team found difficult.The implementation was not without its problems, and the company had several recommendations for improvements it would like to see from SAP including improved engineering change to support a rapid change environment, performance speed for rapid calculations, flexibility for mass changes, calorie calculations for non-traditional ingredients, and a more user friendly workbench for users. AMR, February 2007 Analyst Remarks About Agile About SAP
Manufacturers with large investments in SAP ERP want to extend their SAP commitment into SAP PLM, but user adoption is often an obstacle. While SAP PLM continues to mature as a product, adoption, in many cases, isnt about how capable it is, but if it can be used easily. AMR, 2/07 Manufacturers report that these solutions (xPD and xRPM) do not match the capabilities and time to value of specialty PLM providers SAP PLM customers cite their investment in SAPs ERP software and value of integrated PLM to streamline such business processes.However, it will take more investment by SAP and its customers to realize them. Gartner Agiles software offerings reflect forward thinking about enterprise-centric PLMAgile is the first PLM-dedicated vendor to aggressively promote product analytics and portfolio management. Gartner's life science clients have praised Agile forits support of Title 21 Code of Federal Regulations (21 CFR) Part 11 requirements out of the box. Agile's acquisition of Prodika gave it comprehensive capabilities for recipe/formula management, supply chain collaboration, and regulatory compliance among producers of consumable packaged goods. Gartner Magic Quadrant & Industry Reports, Oct. & Nov. 2006 What SAP Will Position Align with CIO/CFO 1 You Already Own SAP PLM 2
Leverage your strategic vendor. Its all about Netweaver and composite applications Agile will require another large investment 1 You Already Own SAP PLM Just need to deploy the solution.PLM is not a standalone system Agile cant meet your goal of an integrated business platform 2 SAP is the PLM Leader Over 5,000 customers worldwide Largest PLM footprint 3 Agile Losing Its Focus Oracle acquisition will be overwhelming Focus will be Oracle EBS customers Domain experts leaving the company 4 d Agiles Not a Scalable Solution Point solution for small EHT companies A9 platform has stability, scalability issues 5 If Losing They will Stall The functionality you need is on our roadmap 6 SAP PLM Positioning: Product Superiority
SAP is the most complete enterprise PLM solution Integration of PLM, ERP, SCM and CRM A Holistic Approach to PLM -- supports all product life-cycle processes, not just engineering provides consistent, relevant information on demand, at any time and from any place, across all departments, and across the extended supply chain Objection Handling: mySAP PLM is free.
About SAP Manufacturers report that these solutions (xPD and xRPM) do not match the capabilities and time to value of specialty PLM providers. SAP PLM customers cite their investment in SAPs ERP software and value of integrated PLM to streamline such business processes.However, it will take more investment by SAP and its customers to realize them. Marc Halpern, Gartner, November 2006 No PLM Vendor Serves All Manufacturers Equally Well Agile Position:More than a 1/3 of Agiles largest enterprise customers are SAP customers who: Couldnt afford to wait for SAP to execute on their PLM vision. SAP admitted during their last PLM customer summit to still being 3 years away from a complete PLM offering. Identified specific functional requirements that SAP could not satisfy, but Agile could. Were convinced that Agile provided the fastest time to benefit. Large Customer Examples
Objection Handling: Agile cant meet the needs of large, global deployments. Large global market leaders continue to chose Agile PLM Oracle|Agile customers include some of the largest companies/best known brands in the world, with some of the largest PLM deployments. Agile products are available and deployed in 6+ global languages. Agile supports Global Product Development SAP has no references for doing PLM across multiple SAP instances Large Customer Examples Users Deployment Siemens 17,000+ Users Global Qualcomm 8,000+ Users Flextronics 10,000+ Users Hitachi 5,000+ Users ZF 6,000+ Users GSK 11,250+ Users Harris d Objection Handling: Agile PLM wont integrate with SAP ERP as well
Over 1/3 Agile Customers use mySAP ERP Agile good at managing product record SAP good at managing financial, production, and customer records Out of box integration with multiple SAP and other ERP instances. SAP PLM not seamlessly integrated w/SAP ERP Using NetWeaver to integrate its own disparate products Involves multiple technologies (R/3, composite applications, etc.) Difficult to integrate with multiple instances of SAP More difficult to integrate with other ERP (other divisions etc) Requires high cost of customization and support to fill functional gaps (collaboration, etc) We also continue to see deployments that include expensive-to-maintain customizations in areas like labeling and reporting, and have yet to find an instance where recipe management at the ERP level is tightly coordinated with recipe management at the plant level, particularly in automated environments. Manufacturers with large investments in SAP ERP want to extend their SAP commitment into SAP PLM, but user adoption is often an obstacle it isnt about how capable it is, but if it can be used easily. Michael Burkett, AMR, Feb. 2007 SAP PLM 2007 Conference Is All About Usability - Mathias: I have added the Using SAP PLM eliminates need for ERP-PLM interface statement. Sample of Joint Agile & mySAP ERP Customers Success Story: Beating SAP at AMO
Customer Business Issue: Grew to $1B in revenue through acquisition Increased pressure to accelerate number and timing of NPIs Implementing global collaborative design and manufacturing across 26 sites with a single contract manufacturer Multiple sites maintaining regulatory documentation increased regulatory compliance risk SAP Offering: SAP installed for ERP, PLM is free Agile Offering: Product Collaboration, EDA and MCAD integrations, Advanced Visualization, integration to SAP ERP $1.3 M software and $1M services Success Story: Beating SAP at AMO
SAP Strategy: Aligned with the CIO reporting to CFO, pushed SAP is free Deloitte team doing ERP implementation supported this position with the CFO/COO Did not engage with the business until it was clear they were losing When pushed, attempted to show CAD integration Could not provide a referenceable customer in Life Sciences in the USA, provided one reference in Germany who was using c-folders only CIO and Deloitte fought for SAP until the end CIO had to work with Agile after the business formally stated their findings and refused to consider SAP PLM further Success Story: Beating SAP at AMO
Agile Strategy: Avoided CIO and engaged SVP Ops, VP QA, VP Clinicals & RA, 5 VPs of R&D, Directors in Packaging Engineering, Components Engineering, Manufacturing, Managers in all functions including Doc Control Sold ability to solve their specific issues: Easy of use, adoption by R&D & all engineering functions Ability to securely collaborate across 26 global sites Single repository for regulatory records, controlled change and compliance with security Provided 32 references called over 10, validated Agiles message with proven implementation success Forced a functional bakeoff through the business The business groups refused to use SAP after the bakeoff Free PLM software TCO argument died we sold if you dont get adoption of the solution, you wont get the ROI PLM provides thus SAP is Higher TCO than Agile even though its no software cost Key Takeaways You can use Agile PLM as a competitive advantage to beat SAP at any product company Expect to compete with SAP for PLM only in their install base We need to win the confidence and support of the business for these opportunities SAPs PLM message will sound just like ours Detailed use case demonstrations are required to educate the customer Make customer references a requirement SAP is still at least 3 years behind in product functionality Leverage your Industry/PLM domain experts Key PLM Resources @ Oracle
NA Specialty Sales Teams Kevin KennedyVP PLM Sales Frank MouthaanDirector PLM Pre-Sales Global Sales Support Bill Welch Solution Architect Dir. IBU PLM Experts Dave ParsinSr. Dir. High Tech Todd HeinSr. Dir. Life Science Bernard GoorSr. Dir. Consumer Goods PLM Marketing Chris FarinacciVP PLM Marketing Sarvesh JagannivasVP PLM Product Mkt. Questions 22 Oracle