September 3, 2025 • 37 mins
Nasdaq-listed tech services company Rimini Street is challenging the status quo in New Zealand’s enterprise IT market, offering a striking alternative to the upgrade treadmill set by big software vendors.
On this week’s episode of The Business of Tech, Seth Ravin, founder and CEO of Rimini Street, and Joe Locandro, global CIO, share their vision for how New Zealand enterprises and government agencies can maintain legacy enterprise resource planning (ERP) systems, dramatically reduce support costs, and harness artificial intelligence for innovation, all without costly upgrades or cloud migrations.
Rimini Street’s business model is built on lower profit margins than the incumbents, which Ravin used to work for with executive-level stints at PeopleSoft and SAP.
“If you’re driving a 90% plus profit margin, just do the math. You cannot offer much service. You have to say no to just about everything,” Ravin said.
“So in that environment, we said, we’re going to spend more on the customer, give them more service. We’re going to cut the price in half, accept a much lower profit margin. We’re going to make it better for the customer, and we’re going to have a good business, a solid business”.
Tune in to episode 114 of The Business of Tech for the full discussion powered by 2degrees Business, streaming on iHeartRadio or wherever you get your podcasts.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
You're listening to the business of tech power by two
degrees business. I'm your host, Peter Griffin, and amidst the
news of business closures, growing unemployment and a puttering economy,
will take any good news we can get as we
head into spring, and definitely a big win this week
is Amazon's launch finally of its New Zealand Data Center region,
(00:23):
which represents a major injection of dollars into the country.
Speaker 2 (00:27):
Amazon is going to invest seven and a half billion
New Zealand dollars, and as I mentioned before, this represents
the largest publicly announced global tech investment in New Zealand ever.
We expect to support one thousand new jobs and the
multiplier effect of these investments will affect local businesses, drive skills,
(00:51):
but most importantly will accelerate the transformation of New Zealand
into a leading technology hut.
Speaker 1 (00:57):
So what else do we know about these data centers?
There are three of them in the Auckland region or
within one hundred kilometers of each other, and co located
with third party data centers, so AWS hasn't built its
own one from the ground up. It did have a
site in West Auckland with that in mind, but after
(01:18):
issues with drainage there. It's opted instead for three co
located sites, which is not unusual for AWS overseas. It
hasn't named who these data center hosts are for security reasons.
It says there are big players in the Auckland regions
such as DCI and Canberra Data Center's CDC, so they'd
(01:41):
be top of the list as potential candidates there as hosts.
The data centers, according to AWS, are powered one hundred
percent by renewable energy from day one. That's through a
long term energy agreement with Mercury. Microsoft did a similar
deal with Contact Energy for its data centers, which opened
in December. AWS has pledged to train one hundred thousand
(02:04):
kiwis in cloud skills by twenty twenty seven. Over half
of them are already trained according to AWS, so people
through various partners have done cloud skills or AI courses.
It's unclear exactly how extensive they are, how advanced those
skills have got, but I can imagine a lot of
(02:26):
people in existing companies that use AWS cloud tools have
been able to upskill and reskill with these three courses.
That's a good thing. The region is fully operational with
all required consents and environmental considerations addressed. According to AWS,
and there are some big names that have signed on
(02:47):
to be hosted in these data centers, including Kiwibank, Deloitte,
Vector one, Enz and Datacom smattering off government customers as well.
Couldn't tell me exactly what proportion of AI workloads will
be represented by the data center usage at launch, but
(03:07):
he did say that AWS will bring advanced AI services
such as Amazon, Bedrock and sage Maker to the region
later this year, so that'll be good for Kiwi innovation.
Those tools are currently only available from data centers offshore.
So yes, this is a decent investment in cloud infrastructure,
(03:28):
you know, that's critical to the digital economy, a sort
of benchmark really as to whether we're a developed nation
actually worth investing in, which is a question that has
given many companies pause of late when they look at
New Zealand. But the data center arrives a year late
and into a pretty soft economy, much softer than when
that investment was planned out four years ago. Amazon's business
(03:52):
model depends on New Zealand businesses and government department sending
increasing amounts of data and applications to the cloud, but
that requires significant investment for businesses with their own on
premises or even co located infrastructure. Many of them just
don't have the money at the moment. They're deferring cloud
migration and so called digital transformation projects, even if the
(04:15):
cost equation may work out favorably over the long run.
But this week's guests on the Business of Tech have
a different take on the race to the cloud. Seth
Ravin is the founder of Las Vegas based NASDAQ listed
IT services firm Remeny Street. Joe Lecandro is the company's
Australia based group executive vice president and global Chief Information Officer.
(04:39):
Remeny Street provide third party support for big on premises
enterprise IT systems from the likes of Oracle, PeopleSoft, SAP,
and VMware. Their pitch is that they can save customers
up to fifty percent on support fees for those systems,
below what they typically be charged by the software vend
(05:00):
annual support programs. Not only that, Ravin's big pitch is
that you can stay on those legacy systems for another
fifteen years. They'll support them out to twenty forty In
many cases, don't get caught up in the race to
the cloud. They say, sweat your perfectly good existing assets
and save significantly on support fees. But what about new
(05:23):
features like AI? AI agents are all the buzz at
the moment. Remeny Street say they've come up with a
way to run AI tools and agency even over the
top of those legacy platforms, which Ravenc's is basically becoming
large databases of information that you use AI to extract
information and insights from. You don't actually need to upgrade
(05:48):
to the cloud version to get that added functionality. It's
a bit of a controversial approach that has seen remeny
Street tied up for years in legal action with Oracle,
which are just this year's set, but the cost saving
narrative certainly has widespread appeal. Remeny Street had revenue off
around four hundred and twenty nine million dollars US last
(06:09):
year and has a growing slate of customers in New Zealand.
So here's remeny Street founder Seth raven and global CIO
Joe Lecandro on how to find new life in your
legacy tech Seth and Joe, Welcome to the business of tech.
(06:31):
How are you doing?
Speaker 3 (06:32):
Great? Good, good good to be back in the Australia,
New Zealand market and looking forward to having a trip
to New Zealand in a couple of days.
Speaker 1 (06:42):
Yeah, yeah, that's great. You're coming over to see customers
and talk to enterprise IT people here, and quite a
compelling proposition that you'll be giving them, and we're going
to get into that shortly. But big milestone for you,
seth the company is as we record this, a couple
of weeks away from being twenty years old two thousand
and five. You set up this company after very senior
(07:05):
roles at vice prison of SAP for instance, PeopleSoft. You're
at enterprise IT guy through and through. Tell us about
the genesis of the company. What inspired you doing really
well in these highly established companies? What inspired you to
go out on your own and sit up Reminy Street.
Speaker 3 (07:23):
You know, Peter, I was actually in the business of
the maintenance and seeing the customer value at PeopleSoft. We
built the company from the early team up very successfully,
and we built a maintenance team, and I watched how
we continued to raise the rates or we used to
charge them fifteen percent of their of what the license
(07:47):
fees were, then seventeen, then eighteen, then twenty, then twenty
one and twenty two percent, and the profit margins continued
to rise up to in the ninety percentage points. I'm
sure many of your listeners would love the idea of
a ninety percent profit margin, but the reality is there's
(08:07):
few companies in the world that achieved that kind of number.
And so I went off and I looked at a
bunch of things, and when I left SAP, I looked
at this opportunity. And in every other part of the economy,
there's choice. You can take your car to the dealer
(08:28):
that you bought it from and have the mechanics work
on it, but you can also take it to the
local mechanic down the street if you like them better.
And so every part of our world had alternatives. But
in the world of enterprise software, there was an assumption
that only the software vendor could fix the system, could
(08:48):
run the system, and therefore you had to pay these
exorbitant amounts of money for in many cases, low value,
and that's the only choice. So there was this attached
rate of over ninety nine percent. I looked at that
and said, you know what, I'm going to take my
experience and I'm going to come in and offer an
alternative in that space. At half off and better service.
Speaker 1 (09:12):
Well, look, that's that's the pitch, isn't it. You know,
remeny Street says it can help organizations dramatically cut their
support costs on platforms like SAP and Oracle. You know,
big customers here using both of those. What's at the
core of the savings. Where do you find the sort
of efficiencies that Oracle or SAP don't.
Speaker 3 (09:33):
It's not just about the efficiencies. If you if you're
willing to accept a lower profit margin, you're in a
position where you can say, Okay, we're going to accept
a reasonable profit margin and we're actually going to spend
more money to service the client. Because if you're driving
a ninety percent plus profit margin, just do the math,
(09:58):
you cannot offer much service. You can't. The money's not there.
You have to say no to just about everything. And
so in that environment, we said, we're gonna we're gonna
spend more on the customer, give them more service. We're
gonna cut the price in half, accept a much lower
profit margin. That's reasonable, and that's how we're going to
(10:22):
do this. We're gonna make it better for the customer,
and we're going to have a good business, a solid business.
Speaker 1 (10:27):
And Joe, look, you're also enterprise it guy, through and through,
you know, senior roles, Emirates, Cathay Pacific and many Australian companies,
and then over the ditch here at at Fletcher's for
a while as as CIO, and that is a big
sap shop, you know, Fletcher's, So give us your perspective
(10:48):
being a CIO, I guess frustration at exactly what Seth
was talking about in those roles, seeing these high maintenance
and support charges and then being inspired to actually join
Seth and cutting those for customers.
Speaker 4 (11:04):
I've been a practicing CIO globally for over twenty five
thirty years, and for me, like most other CIOs, you're
on the treadmill, you're on the upgrade path, and in
most cases the cost to move is a barrier, even
if you were getting a huge price increase, and vendors
(11:28):
typically know that that even if they rip up the
price year on year, the cost to exit is greater
than the price of the increase. But for me, the
value proposition of Rhymney and It was that we had
some tech debt and everybody wants to modernize and until
(11:53):
you know the advent of AI and things like that.
There wasn't many alternatives. Most CIO and most executives got
their world best practice through upgrades or supposedly through your
maintenance fee. The problem is sometimes you used all the functionality,
(12:13):
sometimes you didn't, but you're still stuck with the cost
of upgrading. And that's the real hidden cost. It's not
necessarily the license cost. It's the cost of upgrading because
sometimes and I did an upgrade from ECC six S
for Hannah, and the most common bit of feedback I
(12:36):
was getting is that this runs totally different. It's not
an upgrade, it's a new implementation and the change management
and all everything that's associated with it, and all that
is for the sake of I'm going to get more
functionality because I have to modernize. But now there are alternatives.
(12:57):
And when I joinedney Street and I'd seen firsthand as
a customer, and I think that's the proof in the putting.
When you're a customer and you've got all the cost
pressures and you've got all the board pressures and compliance pressures,
and you know that doesn't go away. And rymney Street
offered me, in my role in New Zealand, an alternative
(13:21):
that I was able to keep those systems running more
cost effectively.
Speaker 1 (13:27):
Yeah, and look the exactly as you say that upgrade
treadmill that you know most New Zealand Australian organizations are on.
You know, I've been hearing a lot from SAP, you know,
putting out this message support is ending for our legacy
systems in twenty twenty seven. You need to move to
the cloud to is for Hannah, don't be left behind.
(13:50):
So that is very much from all the vendors, whether
it be Microsoft, Oracle or any of them, you'll fall
behind on security, compliance and integration. And if you don't
go on this pathway. What is quite refreshing and different
is this opposite you view that you take that legacy
platforms can continue running safely and reliably.
Speaker 3 (14:13):
So how do you do this? Again, You start with
excellent engineers. We have nearly one thousand engineers across twenty
three different countries, and you start with the quality of
that engineering talent, and then you build a system of
processes that allow you to respond in things like two
(14:37):
minutes or less twenty four by seven, which again we
support all the way up to military and then of
course things like nuclear power very very high security operations
that we help manage. And so when you see all
that and you put all those pieces together, you have
(14:58):
a program that can right what the vendors offer. It's
actually more robust. We cover things that the vendors don't uh.
And it really is a function of what is it
you're willing to do, what is it you're willing to
spend in order to service the customer, and what profit
margin you're willing to take. And I think we've come
(15:18):
up with a great balance that allows for a strong company.
You know, we're grown over four hundred million US a
year as a stock exchange a traded company in the US,
and we've been able to build a company with thousands
of clients, including hundreds of the world's largest companies and
government agencies. And so it's it's been a really exciting
(15:41):
thing to come into a market and change the dynamic
where customers are like, wow, I mean I actually have
an alternative and it's and it's a very pragmatic alternative
because they're used to this in their common life. You
you know, if you're washer and dry or break down home,
you can call the manufacturer, you can call Joe's repair shop.
(16:04):
Down the street and you have those rights. I mean,
this is in many ways we're just bringing the same
kind of choice that consumers have in their daily lives.
Speaker 1 (16:14):
And that speaks to really the disconnect I see and
here when I talk to cio CTOs and boards of companies,
there's a disconnect between the speed at which the vendors
want to move, particularly in the cloud era where it
is moving very very quickly, and their ability to move
their legacy systems. And particularly it's hard times in New Zealand.
(16:38):
We're in a recessionary environment at the moment. A lot
of budgets have been cut, so they're being told we're
going to have to defer these upgrades. So your pitch,
I think is very attractive. But is there a danger
that companies that sort of sit on their legacy stuff
defer upgrades, that they're just pushing cost into the future,
(17:01):
or are they going to end up with sort of
brittle systems that limit their ability to innovate.
Speaker 3 (17:06):
But you know, Peter, there's two things. You can save
money and you can invest money. And what we do
is by lowering the daily cost of operations, we allow
organizations to make decisions. You know, if you're really in
a tight financial position, you can drop all the savings
(17:26):
to the bottom line. You can do that if you
are in a middle ground where you're saying, look, I
need to save something, but I also need to innovate.
Because the truth is, Peter, you can never cut your
way to growth. And if you're in a position, and
it always depends on where you are in the economic
cycle of both an organization as well as the economy.
(17:49):
If you're in a defensive position again where it's throw
everything overboard and we just need to we need to
cut costs, we need to get that cost down. Great,
we can help with that if you want it and
make an investment. You must invest in innovation in order
to accelerate growth and maintain and grow competitive advantage. And
(18:10):
that's why most of our customers, instead of saving the
full amount, they'll save some of the money that we
help cut in costs, and then they'll invest some of
that money. Some do fifty to fifty. We'll drop for
every you know, for every dollar that we say, we're
going to put half of that on the savings line
and we're going to put half of it into innovation,
(18:32):
and we allow innovation to continue forward by reallocating that
part of the savings into new technology, so they don't
have to sit on their hands and knees, and they
don't have to just wait and do nothing. And because
we've now got an innovation model investment that says we
(18:53):
can do small pieces at a time, they don't need
to do some massive project that nobody is going to
approve from a risk and cost perspective. But we can
do a piece at a time and move a customer forward.
So progress is possible even within a cut budget if
they're willing to allocate for it.
Speaker 1 (19:14):
Joe Remenie Street often talks about you know, layering artificial intelligence,
data analytics and the like on top of these stable
but you know, legacy systems to extract new value from
those older systems. So how does that work in practice?
Particularly again the message from the vendors, if you want
to get the best out of AI agents, for instance,
(19:37):
on SAP or Salesforce or Oracle, you really need to
be on our cloud. But you're saying no, you can
run AI over the top of all of that off
those older systems.
Speaker 4 (19:47):
Yeah. Correct, And I think this is the this is
the paradigm shift. This is the choice as a CIO
did not have two years ago. If I wanted innovation
or increased functionality, I had to upgrade because the older
system was seen as a blocker to innovation. AI wasn't
(20:07):
around two years ago in the sphere, little one agentic
the term. So the difference now is those systems of record,
those ERPs, financial systems or whatever run well. They've got
their customizations where they're giving value, you're really sweating the asset.
(20:28):
But they're compliant, they're auditable, etc. So therefore the premise
is, is there an alternative path to give me functionality, give
me innovation without having to rip out and replace the core.
And this is where agentic AI comes in. Now, agentic
AI and generative AI. Most people are familiar with generative
(20:51):
AI through co pilot and chat GPT, and it does
a bit of predictability based on some sample sets prior.
Agentic AI is a workflow and when you combine predictive
analytics and generative AI together with workflow, you can put
(21:13):
that on the top of the ERPs. And that's the
big difference. In the old days, you would have to
customize your old ERP to a new workflow and new
job type, but speed to market is what is important
now because an ERP upgrade or a functionality one would
take several years and significant cost to build. On Seth's point,
(21:39):
the agents that are roaming across the top go through
what we call a data fabric layer, and those are
like self determining data dictionaries. If the agent is looking
for financial information, it will recognize that when it goes
into a financial system, there's numbers, and there's customer attributes,
(22:05):
and it knows it's a financial system. It's building up
that on the fly. If it goes into a CRM
system like a salesforce, etc. It's seeing customer notes, it's
seeing all those things. So the intelligence is now being
in the layer above, just as the intelligence in routers, etc.
(22:26):
Is now in the software above. This is a trend
that you see where the intelligence gets taken out of
the core hardware or firmware into that next layer above.
So what that means is for companies and CIOs is
that they can mix and match processes, they can mix
(22:47):
and match data and analytics, and they only have to
go into the source system for the information it needs.
And a good example is if you're in inventory, you
have to go through two or three systems to do
your job, and you do about twenty clicks. If you
had an agent, it could go and check the inventory
(23:09):
through the inventory system. It could predict that through the
sales that you're going to run out within four months.
It can create a process where it automatically creates a
purchase order, looks at the vendor file, and automates all
that from twenty clicks to one click, from twenty minutes
to two minutes, with all the recommendations and automation. And
(23:33):
that is quick, cheap and easy to do on top
of the ERP and you can keep doing that many
many times over. You don't have to wait for the
next upgrade, which is like I say, a reinstall in
most cases.
Speaker 1 (23:50):
It's really quite a challenging concept to the model we've
been sold. I mean, what's the future of these big
ERP systems. Are they essentially just going to become like
databases where you use your own AI agents and interfaces
to interrogate those systems and get the reporting and the
information you need out of them.
Speaker 3 (24:10):
Well, Peter, I believe in five to ten years our
position is there's no ERP software. We are now in
the process of converting. If you look at ERP software,
these big monolithic systems, they were designed to run most
of the key processes of a business or an organization.
(24:34):
And we always had these defined processes like order to cash,
procure to pay.
Speaker 4 (24:40):
They haven't really changed.
Speaker 3 (24:42):
We've been doing We've been counting the beans as accountants
for years. You know, we have to send out invoices,
we have to pay employees. None of that has changed really,
you know, in fifty years, we just have improved the systems.
They've got prettier screens and things along the line, but
it makes it a little bit easier. But we're still
(25:03):
doing the same functions. And what we're doing now is
we're taking these processes and we're turning them into aegentic
ERP processes that live above where the ERP system is.
And as we build these out, connecting up a whole
bunch of different services with a workflow system like service
(25:26):
now and then we're using intelligent agents to run those
processes instead of human beings. And so when all that
comes into play, there's no need for the underlying EARP
software anymore. It goes away. And so you can imagine
how terrifying This is for the ERP software vendors, and
(25:47):
this is the vision we're out there. In fact, we're
installing this already. We just put in in a company
called Absent Pharmaceuticals in Brazil. We took their existing SAP system,
their ECC system, and instead of doing the big migration
that SAP wants them to do, we put the service
(26:07):
now over the top. We've now automated almost seventy percent
of all the manufacturing processes where they had human intervention,
and they're loving it. They went from an experiment to
the company's full position, and this is the direction they're going.
Instead of the big upgrade migration, which really wasn't going
(26:28):
to provide any value. It wasn't going to change the game.
We're changing the game with this new agentic AI across
the top. It's really exciting you are.
Speaker 1 (26:38):
But as the world goes sort of cloud night, of
which most companies will end up there, what does that
mean for you guys.
Speaker 3 (26:45):
It was interesting in our panel sessions yesterday with a
lot of the biggest companies that you can imagine across
the ANZ market, it really came out that SAS is
dead and that was you know, it's shocking. It's we're saying, well,
the underlying ERP is dead, and they think SaaS is
(27:06):
dead because the whole model of software is changing. Everything
is about data. Now. Data is the gold, and so
it's not about the number of users, it's not about
how you know, Oh, let's see the turnover of your
organization and price it that way. Everybody wants to meter
the data. The data is moving from point A to
(27:27):
point B, to point C to point D. Everyone wants
to get in on figuring out how do I get
a piece of the action. So everyone wants to set
up tall boots so that they can collect a toll
as data moves from place to place. It's a fascinating change,
and we don't even understand how to cost. What's this
(27:48):
going to look like If everyone's putting a toll booth
and it's my data, but you want you want to
charge me for pulling my own data from from here
to there.
Speaker 4 (27:58):
We don't really even understand that.
Speaker 3 (28:00):
Yeah, but it's a whole new world.
Speaker 1 (28:01):
Already we're getting bill shock in the cloud for data
egress and all of that. So that is a concern.
You've You've had lengthy court battles with Oracle over how
you deliver support. So this is challenging to that vendor
in particular. So I think you've resolved a lot of
that now, but how do you reassure prospective clients here
(28:23):
in New Zealand who might be worried about sort of
being caught in the crossfire between Remeny Street and and
and Oracle or SAP.
Speaker 3 (28:30):
The only vendor we ever went to court with was
Oracle for many years. We just settled the Oracle litigation. Uh,
you know, terms are seen and available, but there was
no findings of infringement, there was no no admissions of
any wrongdoing. It's done, uh, and we've moved forward. And
(28:52):
this was a you know, again, these were related to
third party support on very specific Oracle platforms. But the
reality is third party support is legal. There is no
other challenges that have ever been raised in the near
twenty years and we've been doing this, so obviously we're
very confident. When you've got governments and you've got people,
(29:14):
again thousands of customers around the world that have done this,
from your Hyundais in one hundred countries to the largest
of organizations. So this is not a new concept. This
is a proven concept, proven savings, proven value. And this
is just a really exciting time when you're talking about
(29:34):
putting AI over the top of existing systems, and you know,
obviously a little scary in the labor markets, and you know,
what's this mean for people's jobs that were these agents
are getting so smart and they're able to make decisions,
and really it's really something to watch. It's almost science
fiction in so many ways.
Speaker 1 (29:55):
So, Joe, what's the pitch when you come across here?
For instance, as talked about government clients, We've got a
government here that has a cloud first policy, so it's
pushing everything to the cloud, which here effectively means sending
it to Azure with a little bit of a WS
and Google Cloud maybe and a little bit in private
(30:16):
cloud if it's really sensitive for data sovereignty and military
applications and that sort of thing. So is government prospective
client for you here, because they're all struggling with cut
budgets and legacy systems that they will need to upgrade.
But essentially, the pitch is the same to a government
(30:39):
agency is you can sweat that asset for a bit
longer and run AI over the top of it.
Speaker 4 (30:44):
And that's true and I'm seeing that, you know in
Auckland City Council where they've been trying to manage the budgets.
I'm seeing it in Wellington where you know the current
government is trying to optimize its cost structures. And to
be fair, there is just not enough money to go
round in all the government departments and to follow that
(31:08):
traditional path. And the real question for the ministers and
the governments there is can I do and give a
customer or a citizen a better facility and service at
a cheaper cost that doesn't put too much pressure on
(31:29):
the budget. And we know that New Zealand's been in
a bit of pain and continues to be in the
pain and in the interest rates, and you're seeing the
consents are still low, etc. And given that scenario one,
you've got to minimize the cost of just running the
business as it is or running the technology. And that's
(31:52):
where Rymney is really good at supporting the existing at
a far better rate than going through an OEM. Then
the ability to optimize all the systems and get them
supported in a better fashion is another tenet of Rimney Street.
(32:12):
And then finally, after you've consolidated and supported and optimized
freeing up the budget to either allocate towards other goods
or services or to reinvest in what I call agentic
AI and building on gives you a speed and cost
(32:33):
efficiency that is far more superior than the traditional approach.
And that's why I'm saying that you're not really kicking
the can down the road on innovation if you stay
on your traditional ERP. What you're doing is taking an
alternative path to innovation such that you quarantine and quarterize
(32:55):
and make that the most efficient databases it can be,
and redeploy the funds to a smarter, quicker way of
deploying innovation than the traditional path. And that's that's the
big difference.
Speaker 1 (33:10):
Well, I think that's something that's going to resonate with
you know, Judith Collins, our Minister for digitizing Government here
in New Zealand, who is tasked with you know, they're
going to introduce a digital driver's license for instance, and
all of the stuff is great and needed, but initially
you're thinking how much is this going to cost us?
If they can you know, we have a database of
(33:31):
driver licensed data. If we can use AI agents or
something to interrogate that database, that's going to save money,
but just finally seth for you. Where do you see
Reminy Street in a decade at its thirtieth birthday, Is
it still going to be fighting the support cost battle,
or do you see the company moving more deeply into
this AI driven IT architecture, becoming the company that specializes
(33:54):
in the sorts of agents and technology you can use
to get get the best out of those systems.
Speaker 3 (33:59):
Well, I think our smartpath methodology, which is cut the cost,
stop doing things you don't need to do. It's very pragmatic.
That's what creates the people time and money freed up
to either again drop to the bottom line in savings
or drop some to the bottom line and invest some
in innovation. And by the way, you know, we do
(34:21):
governments all over the world. We've got a whole of
government agreement in Australia where we're supporting I think nearly
a dozen different agencies already. We've got an agreement with
the government in New Zealand, and I believe we have
two agencies already in New Zealand that are using Ramini services,
as well as many in the private sector. And so
(34:43):
it really is popular for governments and governments are coming
on board is what Joe said. They're looking for ways
to deliver more value to constituents. This is a really
tough thing. It's always tough to cut budgets, especially in government.
People don't like to give up what they have. But
when we can take the current spend and make it
(35:04):
more efficient, where we can drive, we can pay for
innovation out of the existing spend and so we can
make it a much better experience and we can deliver more.
And when we get to thirty years, I think we're
going to be an innovation leader.
Speaker 1 (35:20):
We are the.
Speaker 3 (35:20):
Guys who figure out how to pay for it, not
come in and say, oh, give us a billion dollars
and we'll see what happens in a few years. Those
projects are dead. Nobody wants to do that, not in
the government, not in the private sector. The way that
we're approaching this is saying, look, we're going to pay
for that innovation because we're going to get smart about
(35:42):
how we're spending today. That budget money is in there,
It is in the existing budget. We just have to
spend it better and then we can reallocate that spend
and do both. We can deliver savings and we can
deliver innovation.
Speaker 1 (35:59):
Yeah, well a compelling proposition. You're on your way to
New Zealand, so hopefully it resonates with some of our
IT decision makers here. Happy birthday, congratulations on your twentieth anniversary,
and thanks both of you for coming onto Business of Tech.
Speaker 3 (36:14):
Our pleasure, thanks for having us.
Speaker 1 (36:22):
So thanks to Seth Ravin and Joe Lecandro from Remeny Street.
A really interesting point of differentiation from most of the
tech vendors I talk to, who really want to get
you to the cloud as quickly as possible, basically so
they can lock in your business. Remeny Streets approach is
actually quite refreshing. You know, what is the future of
these big, monolithic enterprise resource planning systems in the world
(36:46):
of AI is software as a service, something that New
Zealand companies have done very well out of on the
way out as well. Let me know what you think.
Get in touch with me on Peter at Petergriffin dot
Co dot MX, or you'll find me working on LinkedIn,
stream the Business of Tech on iHeartRadio or your favorite
(37:06):
podcast app, and find the show notes at Businessdesk dot
co dot NZ. Just look in the tech section next
week Australia's former Chief Science Advisor and the big bets
Ozzie has made on advanced technologies in recent years and
the potential for us to be smart in doing exactly
the same. That drops next Thursday. I'll catch you in
You're listening to the business of tech power by two
degrees business. I'm your host, Peter Griffin, and amidst the
news of business closures, growing unemployment and a puttering economy,
will take any good news we can get as we
head into spring, and definitely a big win this week
is Amazon's launch finally of its New Zealand Data Center region,
(00:23):
which represents a major injection of dollars into the country.
Speaker 2 (00:27):
Amazon is going to invest seven and a half billion
New Zealand dollars, and as I mentioned before, this represents
the largest publicly announced global tech investment in New Zealand ever.
We expect to support one thousand new jobs and the
multiplier effect of these investments will affect local businesses, drive skills,
(00:51):
but most importantly will accelerate the transformation of New Zealand
into a leading technology hut.
Speaker 1 (00:57):
So what else do we know about these data centers?
There are three of them in the Auckland region or
within one hundred kilometers of each other, and co located
with third party data centers, so AWS hasn't built its
own one from the ground up. It did have a
site in West Auckland with that in mind, but after
(01:18):
issues with drainage there. It's opted instead for three co
located sites, which is not unusual for AWS overseas. It
hasn't named who these data center hosts are for security reasons.
It says there are big players in the Auckland regions
such as DCI and Canberra Data Center's CDC, so they'd
(01:41):
be top of the list as potential candidates there as hosts.
The data centers, according to AWS, are powered one hundred
percent by renewable energy from day one. That's through a
long term energy agreement with Mercury. Microsoft did a similar
deal with Contact Energy for its data centers, which opened
in December. AWS has pledged to train one hundred thousand
(02:04):
kiwis in cloud skills by twenty twenty seven. Over half
of them are already trained according to AWS, so people
through various partners have done cloud skills or AI courses.
It's unclear exactly how extensive they are, how advanced those
skills have got, but I can imagine a lot of
(02:26):
people in existing companies that use AWS cloud tools have
been able to upskill and reskill with these three courses.
That's a good thing. The region is fully operational with
all required consents and environmental considerations addressed. According to AWS,
and there are some big names that have signed on
(02:47):
to be hosted in these data centers, including Kiwibank, Deloitte,
Vector one, Enz and Datacom smattering off government customers as well.
Couldn't tell me exactly what proportion of AI workloads will
be represented by the data center usage at launch, but
(03:07):
he did say that AWS will bring advanced AI services
such as Amazon, Bedrock and sage Maker to the region
later this year, so that'll be good for Kiwi innovation.
Those tools are currently only available from data centers offshore.
So yes, this is a decent investment in cloud infrastructure,
(03:28):
you know, that's critical to the digital economy, a sort
of benchmark really as to whether we're a developed nation
actually worth investing in, which is a question that has
given many companies pause of late when they look at
New Zealand. But the data center arrives a year late
and into a pretty soft economy, much softer than when
that investment was planned out four years ago. Amazon's business
(03:52):
model depends on New Zealand businesses and government department sending
increasing amounts of data and applications to the cloud, but
that requires significant investment for businesses with their own on
premises or even co located infrastructure. Many of them just
don't have the money at the moment. They're deferring cloud
migration and so called digital transformation projects, even if the
(04:15):
cost equation may work out favorably over the long run.
But this week's guests on the Business of Tech have
a different take on the race to the cloud. Seth
Ravin is the founder of Las Vegas based NASDAQ listed
IT services firm Remeny Street. Joe Lecandro is the company's
Australia based group executive vice president and global Chief Information Officer.
(04:39):
Remeny Street provide third party support for big on premises
enterprise IT systems from the likes of Oracle, PeopleSoft, SAP,
and VMware. Their pitch is that they can save customers
up to fifty percent on support fees for those systems,
below what they typically be charged by the software vend
(05:00):
annual support programs. Not only that, Ravin's big pitch is
that you can stay on those legacy systems for another
fifteen years. They'll support them out to twenty forty In
many cases, don't get caught up in the race to
the cloud. They say, sweat your perfectly good existing assets
and save significantly on support fees. But what about new
(05:23):
features like AI? AI agents are all the buzz at
the moment. Remeny Street say they've come up with a
way to run AI tools and agency even over the
top of those legacy platforms, which Ravenc's is basically becoming
large databases of information that you use AI to extract
information and insights from. You don't actually need to upgrade
(05:48):
to the cloud version to get that added functionality. It's
a bit of a controversial approach that has seen remeny
Street tied up for years in legal action with Oracle,
which are just this year's set, but the cost saving
narrative certainly has widespread appeal. Remeny Street had revenue off
around four hundred and twenty nine million dollars US last
(06:09):
year and has a growing slate of customers in New Zealand.
So here's remeny Street founder Seth raven and global CIO
Joe Lecandro on how to find new life in your
legacy tech Seth and Joe, Welcome to the business of tech.
(06:31):
How are you doing?
Speaker 3 (06:32):
Great? Good, good good to be back in the Australia,
New Zealand market and looking forward to having a trip
to New Zealand in a couple of days.
Speaker 1 (06:42):
Yeah, yeah, that's great. You're coming over to see customers
and talk to enterprise IT people here, and quite a
compelling proposition that you'll be giving them, and we're going
to get into that shortly. But big milestone for you,
seth the company is as we record this, a couple
of weeks away from being twenty years old two thousand
and five. You set up this company after very senior
(07:05):
roles at vice prison of SAP for instance, PeopleSoft. You're
at enterprise IT guy through and through. Tell us about
the genesis of the company. What inspired you doing really
well in these highly established companies? What inspired you to
go out on your own and sit up Reminy Street.
Speaker 3 (07:23):
You know, Peter, I was actually in the business of
the maintenance and seeing the customer value at PeopleSoft. We
built the company from the early team up very successfully,
and we built a maintenance team, and I watched how
we continued to raise the rates or we used to
charge them fifteen percent of their of what the license
(07:47):
fees were, then seventeen, then eighteen, then twenty, then twenty
one and twenty two percent, and the profit margins continued
to rise up to in the ninety percentage points. I'm
sure many of your listeners would love the idea of
a ninety percent profit margin, but the reality is there's
(08:07):
few companies in the world that achieved that kind of number.
And so I went off and I looked at a
bunch of things, and when I left SAP, I looked
at this opportunity. And in every other part of the economy,
there's choice. You can take your car to the dealer
(08:28):
that you bought it from and have the mechanics work
on it, but you can also take it to the
local mechanic down the street if you like them better.
And so every part of our world had alternatives. But
in the world of enterprise software, there was an assumption
that only the software vendor could fix the system, could
(08:48):
run the system, and therefore you had to pay these
exorbitant amounts of money for in many cases, low value,
and that's the only choice. So there was this attached
rate of over ninety nine percent. I looked at that
and said, you know what, I'm going to take my
experience and I'm going to come in and offer an
alternative in that space. At half off and better service.
Speaker 1 (09:12):
Well, look, that's that's the pitch, isn't it. You know,
remeny Street says it can help organizations dramatically cut their
support costs on platforms like SAP and Oracle. You know,
big customers here using both of those. What's at the
core of the savings. Where do you find the sort
of efficiencies that Oracle or SAP don't.
Speaker 3 (09:33):
It's not just about the efficiencies. If you if you're
willing to accept a lower profit margin, you're in a
position where you can say, Okay, we're going to accept
a reasonable profit margin and we're actually going to spend
more money to service the client. Because if you're driving
a ninety percent plus profit margin, just do the math,
(09:58):
you cannot offer much service. You can't. The money's not there.
You have to say no to just about everything. And
so in that environment, we said, we're gonna we're gonna
spend more on the customer, give them more service. We're
gonna cut the price in half, accept a much lower
profit margin. That's reasonable, and that's how we're going to
(10:22):
do this. We're gonna make it better for the customer,
and we're going to have a good business, a solid business.
Speaker 1 (10:27):
And Joe, look, you're also enterprise it guy, through and through,
you know, senior roles, Emirates, Cathay Pacific and many Australian companies,
and then over the ditch here at at Fletcher's for
a while as as CIO, and that is a big
sap shop, you know, Fletcher's, So give us your perspective
(10:48):
being a CIO, I guess frustration at exactly what Seth
was talking about in those roles, seeing these high maintenance
and support charges and then being inspired to actually join
Seth and cutting those for customers.
Speaker 4 (11:04):
I've been a practicing CIO globally for over twenty five
thirty years, and for me, like most other CIOs, you're
on the treadmill, you're on the upgrade path, and in
most cases the cost to move is a barrier, even
if you were getting a huge price increase, and vendors
(11:28):
typically know that that even if they rip up the
price year on year, the cost to exit is greater
than the price of the increase. But for me, the
value proposition of Rhymney and It was that we had
some tech debt and everybody wants to modernize and until
(11:53):
you know the advent of AI and things like that.
There wasn't many alternatives. Most CIO and most executives got
their world best practice through upgrades or supposedly through your
maintenance fee. The problem is sometimes you used all the functionality,
(12:13):
sometimes you didn't, but you're still stuck with the cost
of upgrading. And that's the real hidden cost. It's not
necessarily the license cost. It's the cost of upgrading because
sometimes and I did an upgrade from ECC six S
for Hannah, and the most common bit of feedback I
(12:36):
was getting is that this runs totally different. It's not
an upgrade, it's a new implementation and the change management
and all everything that's associated with it, and all that
is for the sake of I'm going to get more
functionality because I have to modernize. But now there are alternatives.
(12:57):
And when I joinedney Street and I'd seen firsthand as
a customer, and I think that's the proof in the putting.
When you're a customer and you've got all the cost
pressures and you've got all the board pressures and compliance pressures,
and you know that doesn't go away. And rymney Street
offered me, in my role in New Zealand, an alternative
(13:21):
that I was able to keep those systems running more
cost effectively.
Speaker 1 (13:27):
Yeah, and look the exactly as you say that upgrade
treadmill that you know most New Zealand Australian organizations are on.
You know, I've been hearing a lot from SAP, you know,
putting out this message support is ending for our legacy
systems in twenty twenty seven. You need to move to
the cloud to is for Hannah, don't be left behind.
(13:50):
So that is very much from all the vendors, whether
it be Microsoft, Oracle or any of them, you'll fall
behind on security, compliance and integration. And if you don't
go on this pathway. What is quite refreshing and different
is this opposite you view that you take that legacy
platforms can continue running safely and reliably.
Speaker 3 (14:13):
So how do you do this? Again, You start with
excellent engineers. We have nearly one thousand engineers across twenty
three different countries, and you start with the quality of
that engineering talent, and then you build a system of
processes that allow you to respond in things like two
(14:37):
minutes or less twenty four by seven, which again we
support all the way up to military and then of
course things like nuclear power very very high security operations
that we help manage. And so when you see all
that and you put all those pieces together, you have
(14:58):
a program that can right what the vendors offer. It's
actually more robust. We cover things that the vendors don't uh.
And it really is a function of what is it
you're willing to do, what is it you're willing to
spend in order to service the customer, and what profit
margin you're willing to take. And I think we've come
(15:18):
up with a great balance that allows for a strong company.
You know, we're grown over four hundred million US a
year as a stock exchange a traded company in the US,
and we've been able to build a company with thousands
of clients, including hundreds of the world's largest companies and
government agencies. And so it's it's been a really exciting
(15:41):
thing to come into a market and change the dynamic
where customers are like, wow, I mean I actually have
an alternative and it's and it's a very pragmatic alternative
because they're used to this in their common life. You
you know, if you're washer and dry or break down home,
you can call the manufacturer, you can call Joe's repair shop.
(16:04):
Down the street and you have those rights. I mean,
this is in many ways we're just bringing the same
kind of choice that consumers have in their daily lives.
Speaker 1 (16:14):
And that speaks to really the disconnect I see and
here when I talk to cio CTOs and boards of companies,
there's a disconnect between the speed at which the vendors
want to move, particularly in the cloud era where it
is moving very very quickly, and their ability to move
their legacy systems. And particularly it's hard times in New Zealand.
(16:38):
We're in a recessionary environment at the moment. A lot
of budgets have been cut, so they're being told we're
going to have to defer these upgrades. So your pitch,
I think is very attractive. But is there a danger
that companies that sort of sit on their legacy stuff
defer upgrades, that they're just pushing cost into the future,
(17:01):
or are they going to end up with sort of
brittle systems that limit their ability to innovate.
Speaker 3 (17:06):
But you know, Peter, there's two things. You can save
money and you can invest money. And what we do
is by lowering the daily cost of operations, we allow
organizations to make decisions. You know, if you're really in
a tight financial position, you can drop all the savings
(17:26):
to the bottom line. You can do that if you
are in a middle ground where you're saying, look, I
need to save something, but I also need to innovate.
Because the truth is, Peter, you can never cut your
way to growth. And if you're in a position, and
it always depends on where you are in the economic
cycle of both an organization as well as the economy.
(17:49):
If you're in a defensive position again where it's throw
everything overboard and we just need to we need to
cut costs, we need to get that cost down. Great,
we can help with that if you want it and
make an investment. You must invest in innovation in order
to accelerate growth and maintain and grow competitive advantage. And
(18:10):
that's why most of our customers, instead of saving the
full amount, they'll save some of the money that we
help cut in costs, and then they'll invest some of
that money. Some do fifty to fifty. We'll drop for
every you know, for every dollar that we say, we're
going to put half of that on the savings line
and we're going to put half of it into innovation,
(18:32):
and we allow innovation to continue forward by reallocating that
part of the savings into new technology, so they don't
have to sit on their hands and knees, and they
don't have to just wait and do nothing. And because
we've now got an innovation model investment that says we
(18:53):
can do small pieces at a time, they don't need
to do some massive project that nobody is going to
approve from a risk and cost perspective. But we can
do a piece at a time and move a customer forward.
So progress is possible even within a cut budget if
they're willing to allocate for it.
Speaker 1 (19:14):
Joe Remenie Street often talks about you know, layering artificial intelligence,
data analytics and the like on top of these stable
but you know, legacy systems to extract new value from
those older systems. So how does that work in practice?
Particularly again the message from the vendors, if you want
to get the best out of AI agents, for instance,
(19:37):
on SAP or Salesforce or Oracle, you really need to
be on our cloud. But you're saying no, you can
run AI over the top of all of that off
those older systems.
Speaker 4 (19:47):
Yeah. Correct, And I think this is the this is
the paradigm shift. This is the choice as a CIO
did not have two years ago. If I wanted innovation
or increased functionality, I had to upgrade because the older
system was seen as a blocker to innovation. AI wasn't
(20:07):
around two years ago in the sphere, little one agentic
the term. So the difference now is those systems of record,
those ERPs, financial systems or whatever run well. They've got
their customizations where they're giving value, you're really sweating the asset.
(20:28):
But they're compliant, they're auditable, etc. So therefore the premise
is, is there an alternative path to give me functionality, give
me innovation without having to rip out and replace the core.
And this is where agentic AI comes in. Now, agentic
AI and generative AI. Most people are familiar with generative
(20:51):
AI through co pilot and chat GPT, and it does
a bit of predictability based on some sample sets prior.
Agentic AI is a workflow and when you combine predictive
analytics and generative AI together with workflow, you can put
(21:13):
that on the top of the ERPs. And that's the
big difference. In the old days, you would have to
customize your old ERP to a new workflow and new
job type, but speed to market is what is important
now because an ERP upgrade or a functionality one would
take several years and significant cost to build. On Seth's point,
(21:39):
the agents that are roaming across the top go through
what we call a data fabric layer, and those are
like self determining data dictionaries. If the agent is looking
for financial information, it will recognize that when it goes
into a financial system, there's numbers, and there's customer attributes,
(22:05):
and it knows it's a financial system. It's building up
that on the fly. If it goes into a CRM
system like a salesforce, etc. It's seeing customer notes, it's
seeing all those things. So the intelligence is now being
in the layer above, just as the intelligence in routers, etc.
(22:26):
Is now in the software above. This is a trend
that you see where the intelligence gets taken out of
the core hardware or firmware into that next layer above.
So what that means is for companies and CIOs is
that they can mix and match processes, they can mix
(22:47):
and match data and analytics, and they only have to
go into the source system for the information it needs.
And a good example is if you're in inventory, you
have to go through two or three systems to do
your job, and you do about twenty clicks. If you
had an agent, it could go and check the inventory
(23:09):
through the inventory system. It could predict that through the
sales that you're going to run out within four months.
It can create a process where it automatically creates a
purchase order, looks at the vendor file, and automates all
that from twenty clicks to one click, from twenty minutes
to two minutes, with all the recommendations and automation. And
(23:33):
that is quick, cheap and easy to do on top
of the ERP and you can keep doing that many
many times over. You don't have to wait for the
next upgrade, which is like I say, a reinstall in
most cases.
Speaker 1 (23:50):
It's really quite a challenging concept to the model we've
been sold. I mean, what's the future of these big
ERP systems. Are they essentially just going to become like
databases where you use your own AI agents and interfaces
to interrogate those systems and get the reporting and the
information you need out of them.
Speaker 3 (24:10):
Well, Peter, I believe in five to ten years our
position is there's no ERP software. We are now in
the process of converting. If you look at ERP software,
these big monolithic systems, they were designed to run most
of the key processes of a business or an organization.
(24:34):
And we always had these defined processes like order to cash,
procure to pay.
Speaker 4 (24:40):
They haven't really changed.
Speaker 3 (24:42):
We've been doing We've been counting the beans as accountants
for years. You know, we have to send out invoices,
we have to pay employees. None of that has changed really,
you know, in fifty years, we just have improved the systems.
They've got prettier screens and things along the line, but
it makes it a little bit easier. But we're still
(25:03):
doing the same functions. And what we're doing now is
we're taking these processes and we're turning them into aegentic
ERP processes that live above where the ERP system is.
And as we build these out, connecting up a whole
bunch of different services with a workflow system like service
(25:26):
now and then we're using intelligent agents to run those
processes instead of human beings. And so when all that
comes into play, there's no need for the underlying EARP
software anymore. It goes away. And so you can imagine
how terrifying This is for the ERP software vendors, and
(25:47):
this is the vision we're out there. In fact, we're
installing this already. We just put in in a company
called Absent Pharmaceuticals in Brazil. We took their existing SAP system,
their ECC system, and instead of doing the big migration
that SAP wants them to do, we put the service
(26:07):
now over the top. We've now automated almost seventy percent
of all the manufacturing processes where they had human intervention,
and they're loving it. They went from an experiment to
the company's full position, and this is the direction they're going.
Instead of the big upgrade migration, which really wasn't going
(26:28):
to provide any value. It wasn't going to change the game.
We're changing the game with this new agentic AI across
the top. It's really exciting you are.
Speaker 1 (26:38):
But as the world goes sort of cloud night, of
which most companies will end up there, what does that
mean for you guys.
Speaker 3 (26:45):
It was interesting in our panel sessions yesterday with a
lot of the biggest companies that you can imagine across
the ANZ market, it really came out that SAS is
dead and that was you know, it's shocking. It's we're saying, well,
the underlying ERP is dead, and they think SaaS is
(27:06):
dead because the whole model of software is changing. Everything
is about data. Now. Data is the gold, and so
it's not about the number of users, it's not about
how you know, Oh, let's see the turnover of your
organization and price it that way. Everybody wants to meter
the data. The data is moving from point A to
(27:27):
point B, to point C to point D. Everyone wants
to get in on figuring out how do I get
a piece of the action. So everyone wants to set
up tall boots so that they can collect a toll
as data moves from place to place. It's a fascinating change,
and we don't even understand how to cost. What's this
(27:48):
going to look like If everyone's putting a toll booth
and it's my data, but you want you want to
charge me for pulling my own data from from here
to there.
Speaker 4 (27:58):
We don't really even understand that.
Speaker 3 (28:00):
Yeah, but it's a whole new world.
Speaker 1 (28:01):
Already we're getting bill shock in the cloud for data
egress and all of that. So that is a concern.
You've You've had lengthy court battles with Oracle over how
you deliver support. So this is challenging to that vendor
in particular. So I think you've resolved a lot of
that now, but how do you reassure prospective clients here
(28:23):
in New Zealand who might be worried about sort of
being caught in the crossfire between Remeny Street and and
and Oracle or SAP.
Speaker 3 (28:30):
The only vendor we ever went to court with was
Oracle for many years. We just settled the Oracle litigation. Uh,
you know, terms are seen and available, but there was
no findings of infringement, there was no no admissions of
any wrongdoing. It's done, uh, and we've moved forward. And
(28:52):
this was a you know, again, these were related to
third party support on very specific Oracle platforms. But the
reality is third party support is legal. There is no
other challenges that have ever been raised in the near
twenty years and we've been doing this, so obviously we're
very confident. When you've got governments and you've got people,
(29:14):
again thousands of customers around the world that have done this,
from your Hyundais in one hundred countries to the largest
of organizations. So this is not a new concept. This
is a proven concept, proven savings, proven value. And this
is just a really exciting time when you're talking about
(29:34):
putting AI over the top of existing systems, and you know,
obviously a little scary in the labor markets, and you know,
what's this mean for people's jobs that were these agents
are getting so smart and they're able to make decisions,
and really it's really something to watch. It's almost science
fiction in so many ways.
Speaker 1 (29:55):
So, Joe, what's the pitch when you come across here?
For instance, as talked about government clients, We've got a
government here that has a cloud first policy, so it's
pushing everything to the cloud, which here effectively means sending
it to Azure with a little bit of a WS
and Google Cloud maybe and a little bit in private
(30:16):
cloud if it's really sensitive for data sovereignty and military
applications and that sort of thing. So is government prospective
client for you here, because they're all struggling with cut
budgets and legacy systems that they will need to upgrade.
But essentially, the pitch is the same to a government
(30:39):
agency is you can sweat that asset for a bit
longer and run AI over the top of it.
Speaker 4 (30:44):
And that's true and I'm seeing that, you know in
Auckland City Council where they've been trying to manage the budgets.
I'm seeing it in Wellington where you know the current
government is trying to optimize its cost structures. And to
be fair, there is just not enough money to go
round in all the government departments and to follow that
(31:08):
traditional path. And the real question for the ministers and
the governments there is can I do and give a
customer or a citizen a better facility and service at
a cheaper cost that doesn't put too much pressure on
(31:29):
the budget. And we know that New Zealand's been in
a bit of pain and continues to be in the
pain and in the interest rates, and you're seeing the
consents are still low, etc. And given that scenario one,
you've got to minimize the cost of just running the
business as it is or running the technology. And that's
(31:52):
where Rymney is really good at supporting the existing at
a far better rate than going through an OEM. Then
the ability to optimize all the systems and get them
supported in a better fashion is another tenet of Rimney Street.
(32:12):
And then finally, after you've consolidated and supported and optimized
freeing up the budget to either allocate towards other goods
or services or to reinvest in what I call agentic
AI and building on gives you a speed and cost
(32:33):
efficiency that is far more superior than the traditional approach.
And that's why I'm saying that you're not really kicking
the can down the road on innovation if you stay
on your traditional ERP. What you're doing is taking an
alternative path to innovation such that you quarantine and quarterize
(32:55):
and make that the most efficient databases it can be,
and redeploy the funds to a smarter, quicker way of
deploying innovation than the traditional path. And that's that's the
big difference.
Speaker 1 (33:10):
Well, I think that's something that's going to resonate with
you know, Judith Collins, our Minister for digitizing Government here
in New Zealand, who is tasked with you know, they're
going to introduce a digital driver's license for instance, and
all of the stuff is great and needed, but initially
you're thinking how much is this going to cost us?
If they can you know, we have a database of
(33:31):
driver licensed data. If we can use AI agents or
something to interrogate that database, that's going to save money,
but just finally seth for you. Where do you see
Reminy Street in a decade at its thirtieth birthday, Is
it still going to be fighting the support cost battle,
or do you see the company moving more deeply into
this AI driven IT architecture, becoming the company that specializes
(33:54):
in the sorts of agents and technology you can use
to get get the best out of those systems.
Speaker 3 (33:59):
Well, I think our smartpath methodology, which is cut the cost,
stop doing things you don't need to do. It's very pragmatic.
That's what creates the people time and money freed up
to either again drop to the bottom line in savings
or drop some to the bottom line and invest some
in innovation. And by the way, you know, we do
(34:21):
governments all over the world. We've got a whole of
government agreement in Australia where we're supporting I think nearly
a dozen different agencies already. We've got an agreement with
the government in New Zealand, and I believe we have
two agencies already in New Zealand that are using Ramini services,
as well as many in the private sector. And so
(34:43):
it really is popular for governments and governments are coming
on board is what Joe said. They're looking for ways
to deliver more value to constituents. This is a really
tough thing. It's always tough to cut budgets, especially in government.
People don't like to give up what they have. But
when we can take the current spend and make it
(35:04):
more efficient, where we can drive, we can pay for
innovation out of the existing spend and so we can
make it a much better experience and we can deliver more.
And when we get to thirty years, I think we're
going to be an innovation leader.
Speaker 1 (35:20):
We are the.
Speaker 3 (35:20):
Guys who figure out how to pay for it, not
come in and say, oh, give us a billion dollars
and we'll see what happens in a few years. Those
projects are dead. Nobody wants to do that, not in
the government, not in the private sector. The way that
we're approaching this is saying, look, we're going to pay
for that innovation because we're going to get smart about
(35:42):
how we're spending today. That budget money is in there,
It is in the existing budget. We just have to
spend it better and then we can reallocate that spend
and do both. We can deliver savings and we can
deliver innovation.
Speaker 1 (35:59):
Yeah, well a compelling proposition. You're on your way to
New Zealand, so hopefully it resonates with some of our
IT decision makers here. Happy birthday, congratulations on your twentieth anniversary,
and thanks both of you for coming onto Business of Tech.
Speaker 3 (36:14):
Our pleasure, thanks for having us.
Speaker 1 (36:22):
So thanks to Seth Ravin and Joe Lecandro from Remeny Street.
A really interesting point of differentiation from most of the
tech vendors I talk to, who really want to get
you to the cloud as quickly as possible, basically so
they can lock in your business. Remeny Streets approach is
actually quite refreshing. You know, what is the future of
these big, monolithic enterprise resource planning systems in the world
(36:46):
of AI is software as a service, something that New
Zealand companies have done very well out of on the
way out as well. Let me know what you think.
Get in touch with me on Peter at Petergriffin dot
Co dot MX, or you'll find me working on LinkedIn,
stream the Business of Tech on iHeartRadio or your favorite
(37:06):
podcast app, and find the show notes at Businessdesk dot
co dot NZ. Just look in the tech section next
week Australia's former Chief Science Advisor and the big bets
Ozzie has made on advanced technologies in recent years and
the potential for us to be smart in doing exactly
the same. That drops next Thursday. I'll catch you in
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