Ilhwa Cuts SAP Costs by Half Through Third-Party Support
A major healthcare firm is swapping direct vendor maintenance for a third-party provider to slash expenses and redirect funds toward operational upgrades.
Healthcare company Ilhwa has switched its SAP S/4HANA maintenance provider from the original vendor to Rimini Street. The move is designed to cut annual support costs by more than half while keeping the existing enterprise resource planning environment stable. This shift allows the company to redirect significant IT budget savings toward internal development and hardware upgrades.
Ilhwa operates in the food, beverage, and pharmaceutical sectors, relying heavily on its SAP system for finance, production, and inventory management. The system is heavily customized to meet the specific needs of different business units. According to reports from GN technics/gaming (en-US), the previous maintenance arrangement was perceived as too expensive relative to the quality of issue resolution received.
Shifting to Dedicated Technical Engineers
Rimini Street provides Level 4 support services, which involve dedicated engineers handling technical issues directly. Instead of navigating multiple support channels or waiting for generic responses, Ilhwa now has a single point of contact for its maintenance needs. This setup is intended to resolve complex technical problems more quickly and with less administrative friction.
The trade-off for this cost reduction is moving away from the primary software vendor for ongoing maintenance. Ilhwa must now rely on a third party to maintain the stability of a system that is critical to its daily operations. While the financial savings are substantial, the company depends on Rimini Street’s ability to understand and manage the specific customizations built into its SAP environment.
Reinvesting Savings into Business Improvements
The reduced maintenance expenses are being used to fund new initiatives within the IT department. Ilhwa plans to develop internal reports within its SAP system and deploy new hardware. These investments are aimed at improving operational efficiency and giving business units greater flexibility to respond to changing needs.
By freeing up capital previously tied up in maintenance fees, Ilhwa can pursue small-scale business improvement projects that were previously out of reach. This strategic reallocation of the IT budget aims to create a more agile and responsive technical infrastructure for the company’s various divisions.
Balancing Cost and Operational Stability
The core benefit for Ilhwa is the ability to maintain a stable ERP system at a significantly lower price point. The company cites the previous cost structure as unsustainable given the level of service received. The new arrangement prioritizes cost efficiency and dedicated support over direct vendor relationships.
For enterprises with heavily customized SAP environments, this model offers a path to reduce overhead without disrupting critical business processes. However, it requires confidence in the third-party provider’s technical depth and long-term commitment to the specific system configuration.
