No Good Turn Goes Unnoticed

Recently one of our NetSuite clients called with a big problem. They are continuing operations in the UK, but the US operations are being put on hold as they wait out this ugly recession. The US ops run on NetSuite and they needed to trim costs as much as possible while keeping a financial history of the business, which 2 years ago was brisk with a bright future.

NetSuite offers of lower cost version for small companies, NetSuite Limited License Edition, but the limits are normally 5 – 10 users and my client wanted only one user. Does not seem like a big deal, and it wasn’t. NetSuite issued a renewal and the client now has the least expensive option until the market turns around and they can return to active operations.

I really did not think twice about the whole thing until I read the following today:

SAP (like Oracle) has so far refused steadfastly to accept partial maintenance cancellations. While this is (from the vendor’s point of view) quite understandable, it can lead to very unpleasant situations that are not without legal issues.

Case in point: a recent insolvency in Germany. A mid-sized company filed for insolvency and failed to revive the troubled enterprise. There are still orders that must be served but in a few months the lights will be out.

Most of the 350 users of their SAP system are gone. Only about 50 are left and, of course, the HR-system is required to pay the residual staff. Closer to year end, a few legal updates will have to be fitted to the SAP-HR-installation.

The administrator, in an attempt to make sure that staff can be paid, asked SAP to accept a partial maintenance cancellation for 300 seats – very appropriate especially in light of the upcoming increase for standard support.

SAP refused to accept the partial cancellation. Either you cancel in full or you pay in full.

Ouch – that’s being damned miserable to a company that is experiencing possible end of life issues.

I know for certain that when our client moves back to full operations in the US they will have some loyalty to NetSuite, who cut them some slack when they really needed it. Why do companies not expect the same from the big on-premise vendors? I can’t say for certain what the psychology is that keeps so many taking it from these vendors for so long. But at some point there will be alternatives and I cannot imagine that some companies don’t finally say enough is enough.

(Cross-posted @ Sightings in SaaS)