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SAP ERP vs Oracle ERP

Finding an appropriate option among enterprise resource planning software options is generally a vitally important step in launching any business plan to bring a product to market.

last updated Friday, March 1, 2024
#oracle vs sap #What is SAP ERP



John Burson     Subscribe
Sap vs Oracle ERP Comparison

CONTENTS

Finding an appropriate option among enterprise resource planning software options is vital in launching any business plan to bring a product to market. Enterprise resource planning software usually consists of a whole suite of applications that work together to optimize a business plan. The two most prominent ERP software suites are SAP and Oracle.

What is SAP ERP?

SAP ERP is a widely used software suite developed by the German company SAP SE. It integrates various business functions and processes, such as finance, human resources, supply chain management, manufacturing, procurement, and more, into a unified system, allowing companies to streamline operations, improve efficiency, and enhance collaboration across different departments.

What is Oracle ERP?

Oracle ERP, short for Oracle Enterprise Resource Planning, refers to a comprehensive suite of integrated business applications created to automate and streamline an organization's business processes. These applications cover a range of areas, including finance, human resources, supply chain management, procurement, project management, and more. The primary objective of Oracle ERP is to provide organizations with a centralized platform for managing and optimizing various aspects of business operations. Doing so helps organizations improve operational efficiency, reduce costs, and make informed business decisions.

Resources and activities

When a company brings a product to market, a few business resources must be carefully tracked to get that product to market efficiently using an optimized system. These resources include capital, materials of production, and the means of production that determine production capacity.

In addition to tracking these various resources, companies must also optimize multiple activities to maximize their bottom line in producing a product. Among these activities are product planning and evaluating the cost of having the product. Of course, a product is useless if it is not adequately marketed so the company can find consumers interested in buying it. Marketing and sales concerns are also addressed in enterprise resource planning software.

Companies must also examine how the product will be manufactured and delivered to the consumer. They need to manage inventory after the product is manufactured and before it is sold. These are additional business activities that enterprise resource planning software must address.

Researching the options

Because ERP software is such a necessary component of efficient business processes, its design and production is a cut-throat industry. Companies looking to increase their bottom lines when bringing products to market are highly discerning when determining which ERP software solution is right for them. They, therefore, should put a great deal of research into deciding between two primary options- each of which has its own respective merits- like SAP and Oracle.
Companies must understand the determining factors in assessing this software package's value to evaluate SAP and Oracle properly.

A few important factors to consider are:

  • Configuration concerns.
    Before an ERP system can be implemented at a company, it inevitably needs to be configured according to that company's needs and desires. Ease of configuration revolves around how easy it is to adjust the software, from how it works to how the company wants to use it. Ease of configuration typically involves how many different system modification operations there are. While configuration options are essential, an excessively long configuration process could detract from the value of the software package by complicating implementation.
  • Customization concerns.
    ERP software programs must be usable in many industries. Customization options can enable them to be used equally efficiently in diverse sectors. Ideally, an ERP software system will be able to grasp the industry best practices of any industry thanks to customization options that improve user acceptance, allow companies to get a competitive advantage over competing companies, and incorporate policies and regulations unique to individual companies and industries.
  • Data migration.
    When an ERP software solution is implemented, a company typically needs to migrate massive amounts of data regarding business resources- capital, materials, and means of production- into the software. The ease of data migration is a primary factor in evaluating the implementation process of a given software option. Data migration involves moving data and copying and restructuring it to be used in the ERP system.

ERP Software Market Share. Oracle vs sap market share.

ERP Software: Market Share
ERP Software: Market Share (SAP vs Oracle market share)

This chart shows the market share of ERP software by the company. We see that even back in 2020, SAP and Oracle were the top two most famous producers of ERP software, with SAP holding 24% of the market and Oracle holding 12% of the market share.

SAP ERP market feedback

According to market share and frequency of short-listing, SAP is the more successful ERP software package. SAP enjoyed 24 percent of the market share back in 2010.
The ERP software offered by SAP is made up of numerous modules. Some modules focus on business functions, including sales/marketing, product design, inventory needs, human resources functions, and accounting. Some companies use the entire SAP Business Suite, of which SAP ERP makes up one part. Other software in the SAP Business Suite includes SAP Customer Relationship Management, SAP Supplier Relationship Management, SAP Supply Chain Management, and SAP Product Lifecycle Management.

Advantages vs. disadvantages of SAP

According to some users and industry authorities, SAP has a lower implementation risk than Oracle. SAP's unique All-in-One product feature helps minimize implementation risk through reconfigurations for various verticals. This feature not only reduces implementation risk but also helps to speed up the implementation process.
Another area where SAP is often touted as advantageous over Oracle is customization. Companies looking to customize their ERP software solution to fit in more closely with their processes for marketing, managing customer relations, and carrying out other business processes can take advantage of the customization tools features in SAP ERP software.

The two main drawbacks of using SAP ERP are cost and delay with capitalizing on the Cloud. As the industry frontrunner, SAP is typically more expensive for customers to purchase. As the frontrunner, SAP has also been slower to grasp cloud technology's revolutionary changes than Oracle. Although SAP offers cloud capabilities with its SAP Business One software, Oracle has been heralded as more successful in maximizing cloud advantages for clients.

Oracle ERP market feedback

Although SAP does enjoy a more significant market share and more frequent short-listing than SAP, Oracle is often selected by companies over SAP when the two types of ERP software are short-listed together. The ERP software offered by Oracle is part of the E-Business Suite, which includes customer relationship management and supply-chain management software.
Oracle ERP offers additional software applications, including Fusion, Peoplesoft, and JD Edwards. The last two- Peoplesoft and JD Edwards- were separate software companies that Oracle bought out.

Advantages vs. disadvantages of Oracle

Some claim implementation advantageous with Oracle, citing statistics that companies pay only 1.7 percent of their annual revenues for implementation costs. Another way Oracle can potentially be more affordable than SAP is through cloud technology. Oracle is eager to help customers cross over to the cloud format, which many business owners consider the way of the future. Cloud technology allows the software to be accessed with lower costs and fewer IT/maintenance needs.
Oracle also has a clear advantage over SAP regarding keeping up with legal and technological standards that are important in specific industries.

The disadvantages of Oracle typically lie in the fact that the software suite is somewhat secondary in importance. Because its usage is more widespread, many companies and staff members will more easily adjust to the implementation of SAP because they may already have experience with the software. 
SAP offers a clear advantage over Oracle when it comes to in-memory technology. SAP got a head start establishing an effective in-memory database with SAP HANA. Still, Oracle has been trying to catch up in recent years by creating a differentiated system capable of integrating with compatible databases/applications.

Conclusion

SAP is probably the best choice if you're looking for easy implementation, customization options, and a single platform system that capitalizes on in-memory technology. If you want to embrace the Cloud, maximize security, or accommodate industry-specific legal/technology standards, go with Oracle.

 
 
 

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