Multi-Tenancy and Other Useless Discussions

An Opinion by Meg Bear, Vice President, Oracle Cloud Social Platform 

Yes I am going to go there...

I know that there are very strong opinions on either side of the multi-tenancy divide. Both are clearly smart people. Both have years of experience and while one is responsible for my paycheck, the reality is the whole conversation is missing the point. 

So first let me clarify that Fusion HCM is multi-tenant....and it doesn't matter

 In the same way that your VHS player having progressive scan doesn't matter.

Really.

Let me break this down a bit more. The solution of multi-tenancy is just that; it's an architectural solution to solve a problem. That problem, has two major components:

  1. Vendor cost of service -- what does it cost to run a SaaS service and by extension, what is the price of that service (and the viability of the vendor).
  2. Customer access to innovation and latest code level -- the shared value customers get by being on the same code level. The ability to innovate more quickly, for the benefit of all customers. The ability to uptake of new features and versions without the heavy tax of customized systems.

Multi-tenancy was a great solution to address these two items.

You might have heard that being a database vendor is an excellent business. Reducing database spend as a SaaS provider is a logical place to go to reduce cost. In addition, legacy applications had much of their code in the database. Keeping everyone on the same codeline required keeping everyone with the same code in the database.

So if your problem is in the database, you would naturally see multi-tenancy as a great solution.

BUT....

If you happen to be a database provider and you happen to have a modern application architecture, then optimizing by putting everyone in a shared database becomes a less valid conclusion.

What is important for our customers to understand, is that we have the ability to provide them a competitively priced, feature rich service that is built to support their global business needs today and in the future. We have better tools and technology, to give our customers access to innovation at the pace of acceleration they have only ever imagined before.

So feel free to talk about VHS options, or multi-tenancy or other non-productive topics, but when you are done don't forget to discuss the business need and the business value

You see, conversations about business value -- that's what we're all about.

Meg Bear
VP, Oracle Cloud Social Platform
Comments:

Great post

I agree that multi-tenancy was driven by technology available at the time. 10 years ago major hardware vendors like Sun, HP sold big iron systems targeted for enterprise systems for on premise applications. The cost of these were in millions of dollars. Virtualization technologies were very immature. So companies like salesforce.com innovated and created multi-tenancy architecture at application level that allowed it to offer the SaaS service at a very cheap price point. Another factor was that these initial SaaS solutions were embraced by SMB typical with less that 100 seats.
Over the last 10 years, there have been significant innovation in both the Hardware and virtualization technologies. Engineered systems like Exalogic and Exadata allow to host large number of VMs and multiple database instance without the need to co mingle the customers data. In addition to this the SaaS model is now being embraced by
Larger enterprise customers with 1000's of seats and it makes sense to provide them with dedicated instances. It certainly helps if you don't have to pay the licensing fees.
however this is the state of affairs today. But it won't be feasible 10 years from now. One issue will be scale. One has to move from enterprise scale to Internet scale. For example, it just won't be feasible for Facebook to offer 800 million dedicated databases to each of its users. Now while i don't imagine HCM to be used by 800 million different companies, even a few 10000's will start to create operational issues.
Another analogy is the real world tenancy. Only a few can afford a dedicated island to build their secure homes. Most have to live in multi story apartment buildings. The same economics will apply. But then perhaps that is not the target market for HCM.

Posted by guest on July 13, 2012 at 12:50 AM PDT #

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