Many BTRG clients are evaluating a move from their on-premise applications to Oracle Cloud SaaS applications. In this blog series I will be examining my top 10 reasons on why it makes sense to make the move to Oracle Cloud Applications. Since this topic is important, I will be splitting up my series into 3 more continuous blogs.
If your enterprise owns on premise applications such as, Oracle PeopleSoft, JD Edwards, Siebel, E-Business Suite, SAP or others, now is the time to start considering a move to cloud applications. If you are planning on upgrading these applications, you’ll want to consider the option of moving to cloud SaaS applications instead of moving forward with the upgrade. Spending the time, effort and funds to upgrade on-premise applications may be much better served by making the move to cloud applications. In this series, we will explore BTRG’s top ten reasons to consider moving from on-premise applications to Oracle Cloud applications. There are significant and game changing benefits brought about by the move to cloud. These benefits include improvements to your business, reduced technical effort and overall reduction in Total Cost of Ownership (TCO) as cloud applications are approximately 2.5 times cheaper to run than on-premise applications. For example, an average on-premise ERP applications can cost $1,725,000 in the first year verses $440,000 for cloud applications. As you can see from the diagrams below, we can draw an analogy between electricity and IT. It doesn’t make sense for every company to produce its own power and electricity just as it doesn’t make sense for each company top provide its own IT, it simply makes sense to leverage the economies of scale and other benefits derived from the cloud paradigm.
Reason #1: Cloud/SaaS applications solve business challenges rapidly
Once a business challenge is identified, the time to realize the solution with on-premise applications is relatively slow compared to cloud applications. Typically, on-premise applications take 2 – 4 cycles to develop and implement solutions to business needs, whereas cloud applications can address business needs immediately to only 1 cycle.
Let’s look at a simple example, such as a report. A business user identifies the need for a new report. With on-premise applications, if this report requires development, you may be looking at a full development cycle to get this new report into the hands of those who need it. Depending on your company a development cycle can take weeks to months. Now with Oracle cloud applications, business intelligence is embedded in the product and perhaps this report is not even needed. If, however, there is a true need, Oracle Business Intelligence Publisher is built into he product along with a full catalog of business objects enabling a business user to create the report on their own without a development cycle. Meaning instead of weeks or months, the user can have this report in minutes.
Let’s look at another example, application upgrades. On-premise vendors are continually updating their applications, fixing bugs and improving them. However, on-premise customers don’t immediately apply these fixes and enhancements and typically take 2 to 4 cycles to get the enhancements into the hands of business users. Many clients don’t upgrade applications with every release and rather upgrade every other release or more. Therefore, from the time a new enhancement is created by the vendor to the time that functionality is in the hands of a business user can be 2 years or more! With cloud applications new functionality and fixes are much more rapidly applied, typically at least every 6 months. That means you can solve business challenges 4 times as fast with cloud applications. Get new features in months rather than years!
Reason #2 One unified global instance
It’s fairly common for enterprises to have best of breed implementations with Finance, Sales, Marketing and HR data in separate applications and databases. Often customers even keep multiple versions and instances of these disparate applications. Sometimes this is due to merger and acquisitions whereby multiple HCM, ERP or other applications are inherited from the acquired company. Sometimes these systems are consolidated and sometimes they are not. So not only are enterprises possibly supporting multiple versions, platforms and copies of one application, they may be supporting several different applications that perform the same functions.
Oracle Cloud Applications exist in one unified global instance for your data, this means that all modules coexist within the same environment. This makes HCM, Sales, Marketing, Finance, ERP and other module data easily available to each other. Gone are the days of writing interfaces and integrations between applications that are part of the same solution. This reduces the need for IT to write and maintain interfaces between your clouds and applications. For example, when using Oracle Cloud Project Performance Management, project resources can be pulled directly from employees within Human Capital Management.
From a support and infrastructure standpoint, this means that all applications are on the same version, same instance and same platform, therefore reducing the complexity within your environment. This also allows for increased and more seamless scaleability, because the cloud paradigm allows for much easier expansion. No longer will your enterprise need to procure, install, configure and support additional hardware for merger and acquisitions, you’ll simply request more capacity for your already existing global instance.