Why do you pay for maintenance on software ranging from Microsoft Dynamics® GP to a warehouse management system (WMS) or fixed asset tracking tool like PanatrackerGP?
A software vendor ought to use maintenance revenues to re-invest, extend and evolve the product in keeping with their development roadmap. So the license fee buys you the product as it is. The maintenance gets you access to the support desk, as well as all of the new versions and functionality a vendor develops over time.
Pretty boring stuff, right?
Of course at the upper echelons of the enterprise software space some of the most dramatic business stories in the industry have involved maintenance fees. The most public cases tend to involve the mega-suite vendors, with SAP being notorious for bundling a number of products into a maintenance agreement or charging maintenance based on users who access data with third party software systems that source data from SAP. SAP also tried to in 2008 force all customers onto a premium maintenance package, but was beaten back by their own user group. More recently in 2013, per analyst Frank Scavo, SAP has made renewed attempts to jack up maintenance fees.
Oracle has pursued third party support providers in court, and both SAP and Oracle have seen maintenance revenues reduced by the availability of third party support offerings. Even middle market enterprise resource planning (ERP) vendor Epicor has gotten into legal fisticuffs with a third party support vendor.
But as folks in our industry will point out, maintance ought to buy you more than support. It also buys future releases of the product and by extension, the ability to influence where that product goes in the future. Even in our humble corner of the market, the Microsoft Dynamics GP extension/add-on space. Maintenance fees on something as simple as fixed asset management tracking functionality or a warehouse management system (WMS) extension for Dynamics GP can buy continuous, ongoing value.
I just had a talk with Nicole Zajork, one of our senior software engineer wizard-level super gurus here at Panatrack, and she was enthusiastic about the type of exchanges she has with customers on a regular basis.
“I was speaking with a customer recently that asked if we could add the ability to print an item label without performing a transaction. I asked them what version of PanatrackerGP they were running. They were running 6.1. I told them that feature came out in version 7.0, and they were delighted. I had a similar experience with a customer looking for custom formatting of their batch code based on transaction fields … it was already in a subsequent release. Another customer wanted a way to identify why certain sales orders weren't available for picking. Again, it was in the last version.”
But Nicole believes that a good software vendor is always restless, looking for the best areas of investment for customers' maintenance dollars.
“We're now refining our existing automated tool that helps us work with customers to optimize their instance of PanatrackerGP to give them a better user experience,” she said. “Right now, they can send us their current PanatrackerGP data usage record, and we can suggest adjustments that will best fit their business situation. This will also be helpful if there is an actual issue that we need to troubleshoot. But in the future, customers will be able to send us this file with the push of a button from within the application instead of doing this manually. Customers may also be able to configure PanatrackerGP to send us this file in response to various events within the application that require our attention. Of the data in this file, their PanatrackerGP settings will be most useful to us, followed by the degree to which they are using specific types of transactions. This not only lets us help the customer in the immediate term, but some of this data can help us understand where we need to invest maintenance dollars and testing time in the future.”
An individual company with a relatively small outlay for maintenance fees will certainly have a lot more leverage with an independent software vendor (ISV) like Panatrack than a company with annual revenues that compare favorably to a medium-sized country like Ghana (Oracle) or Iceland (SAP). But here are a few tips for getting the most value from the enterprise software maintenance dollars you pay out each year:
Stay current on your version! Each new version will include new functionality that you, through your maintenance dollars, have already paid for. To look at things another way, each new version includes features that could deliver efficiencies and reduce cost. So you are leaving money on the tables in two different ways when you fall behind on your software version. You already probably fail to use the gym membership you are paying for every month. Don't do this with your enterprise software as well.
Talk to your vendor! Some software vendors are more responsive to customers than others, but I have not met one yet that posessed psychic abilities. So my personal suggestion would be to pick up the phone and call your favorite contact at your vendor every so often to share a list of suggestions or ideas you may have on how they can serve you better.
Watch out for bumps and other sneaky tactics to maximize revenue to the vendor. The example cited by SAP of forcing every customer on a Cadillac support package is just one tactic to watch out for. But some vendors try to force customers onto a package more akin to an open block of service hours as well and regular maintenance and support, perhaps because they expect a large number of ongoing issues and services projects to get the software to work for the customer. Other vendors might charge maintenance and then add another layer of fees for support which may be one way for them to make it look like their maintenance fees are lower in an apples-to-apples comparison when they really are not.
So yes, maintenance fees can deliver tremendous value. How much? That depends on you and your vendor and the quality of that underlying relationship!