SAP is undoubtedly one of the most robust enterprise resource planning systems in the world. Most of the head quarter based staff like the inherent control and structure it brings to the enterprise. However Salesforce automation needs of an enterprise needs are different. A light weight customer relationship management application which can be integrated with SAP ECC solution is what the sales people need. The application should serve as more of a sales companion than an added system to comply with. Read about our SAP Salesforce Integration services here.
Why not Salesforce.com integrated with SAP ECC 6.0?
High license cost for salesforce.com for large CRM user base
Honestly Salesforce.com has been a revolution in cloud based CRM solutions. It has created a niche for itself and has literally changed the way CRM applications were implemented. My colleagues working on Seibel, SAP CRM and Oracle all agree that SFDC projects are relatively implemented and adopted faster than other technologies. Moreover, added social features like Chatter makes it convenient to share information in a secure environment.
However as we all know Salesforce.com works on a subscription based service. This proves to be both an advantage as well as a disadvantage at the same time. Businesses need not worry less about service levels, infrastructure and maintenance. At the same time, the application is in a hosted environment and organization need to share the application with others due to which there are limitation imposed on how you use the application.
However the main problem which many companies face is that they want to limit their recurring licensing expenditure. This may be substantial if the company is marketing intensive and has a large Salesforce base.
The Alternate – SugarCRM Community Edition integrated with SAP ECC 6.0
SugarCRM in the top alternate to Salesforce.com and many companies have already migrated after knowing the advantages and features which are available. Whereas SugarCRM also offers professional edition at much lower cost, you may want to consider community edition as your integration with SAP will require similar effort. Below is the case study and comparison on implementing SFDC Vs SugarCRM in a SAP landscape.
However please note usually we take for granted that less costly options lack quality. Read below, how SugarCRM is ready to be used by enterprises and which companies are already using SugarCRM right now. This should really eliminate any doubts that you may have about the capability of the platform. It may also be noted that the growth rate and ecosystem of SugarCRM has evolved much faster than SAP itself.
A mid-sized enterprise implemented SAP for $500,000 for its back end business processes. However the company has a large sales team of let us say 200 people, then the yearly Salesforce.com subscription fees turns out to be $300,000 per year (assuming Enterprise version). Whereas this may sound reasonable, please note that this is a recurring cost and not a onetime expense. Any implementation or customization that you need is over and above this figure. The below table shows how the total cost of ownership for 3 years works out to be – the enterprise go for SugarCRM (professional and community editions) instead of Salesforce.com.
|Yr||Cost Description||SDFC||SugarCRMProfessional Edition||SugarCRMCommunity Edition|
|1||Implementation Cost – One time (Mid-sized)||$60,000-$100,000||$15,000- $30,000||$15,000- $30,000|
|License Cost x 200 Licenses – Year 1||$300,000||$ 86,000||None|
|Annual Maintenance Cost – Year 1||$12,000 – $ 20,000||$3,000||$ 3,000|
|Hosting Charges – Year 1||None||None||$ 1,500|
|2||License Cost x 200 Licenses – Year 2||$300,000||$86,000||None|
|Annual Maintenance Cost – Year 2||$12,000 – $ 20,000||$5,000||$ 3,000|
|Hosting Charges – Year 2||None||None||$ 1,500|
|3||License Cost x 200 Licenses – Year 3||$300,000||$86,000||None|
|Annual Maintenance Cost – Year 3||$12,000 – $ 20,000||$5,000||$ 3,000|
|Hosting Charges – Year 3||None||None||$ 1,500|
|Total Cost of Ownership (3 Years)||$ 1 Million||$300,000||$50,000|
Thus you can say that in three year, average savings of 80-90 % can be achieved by using SugarCRM instead of Salesforce.com.
- Midsized implementation of SAP SugarCRM integration
- Assumed that a cloud VPS server costing $ 100 per month would be sufficient for hosting application
- Approximately 35-50% concurrency of user base
- Assumed that development charges of APEX developers are 1.5 times that of PHP developers.
- Annual maintenance charged is around 20% of the implementation cost.
Also read how Veon saved $ 180,000 per year for a HealthCare distribution company by implementing SugarCRM on top of SAP.
Enterprise Readiness – SugarCRM
There have been many questions on whether SugarCRM is ready to be used by enterprises. Believe me SugarCRM has tremendous feature set which makes it enterprise class. Apart from having multi-lingual and multi-currency, high quality API methods and rich administration panel, SugarCRM also gives features such as module builder and studio in its feature set which makes the development and ongoing maintenance much easier.
Big enterprises like IBM, Thomas Cook, Daimler and many more are already running on SugarCRM. IBM in fact replaced a 60,000 seat Siebel implementation with SugarCRM. The company has tremendous growth curve and the solution has matured into its 7th release. In short there is no shortage of feature set if you compare it with Salesforce.com. The community of SugarCRM is enormous. Anywhere you go you would find partners and solution providers available.
Enterprises with large sales / after sales team have to reconsider their customer relationship management strategy. Option to go ahead with salesforce.com means a high level of recurring license cost. Considering SugarCRM on top of SAP is a smart way to rationalize cost without losing out on desired functionality.