New research highlights Oracle Cloud ERP momentum and benefits

January 27, 2022 | 4 minute read
Jonathan Burdett
Product Marketing Analyst, Oracle
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In this digital era, the pace of change appears to be faster than ever before. Staying competitive in this new business environment requires adopting new technologies, embracing new business models, and using cloud as a platform for continuous innovation. Embracing a “business as usual” mindset about technology can have a detrimental impact on a business’s long-term prospects.

IDC, a leading technology research firm based in Massachusetts, recently conducted a study about cloud ERP adoption by Oracle’s on-premises ERP installed base, and published two new documents, Moving to Cloud ERP: What’s Behind the Migration Momentum  and Overcoming Barriers to Cloud ERP.

Cloud momentum is building rapidly

The IDC White Paper included a survey of over 1,600 organizations across North America, Europe, and Asia, currently running all or a portion of their business on Oracle ERP on-premises (either Oracle E-Business Suite, Peoplesoft or JD Edwards). 15% of these customers have migrated to Oracle Cloud ERP, and nearly 25% are currently in the migration process, signaling that the early adopter phase appears to be over.

Here are a few interesting findings:

  • 72% of organizations are seeking a cloud ERP provider that offers solutions for other lines of business beyond finance. Reducing technology risk and exposure was cited as an important reason for this. One organization told IDC, “We have over 800 applications and 150+ vendors, so reducing our technology vendor risk was critical to us choosing Oracle since they have so much more in capabilities.”
  • In addition to the over 40% who have migrated or are in the process of migrating, 47% plan on moving to Oracle Cloud ERP within the next 2–10 years, with the bulk of those moves planned in the next five. The remaining 13% currently have no current plans to make a move.
  • Organizations that have already moved to Oracle Cloud ERP (84%) rate their move as “good to very good.” This far outpaces the on-premises ERP ratings of any large vendor.
  • The onset of the global pandemic has also been a huge accelerant to cloud ERP adoption. According to IDC, “68% of organizations indicate the pandemic has hastened their journey to the cloud. It becomes obvious that working from anywhere, on any device is a necessity. It's apparent that a move away from on-premises technologies is now the norm.”

Recent drivers of cloud migration

As part of this move, more organizations are emphasizing environmental, social, and governance (ESG) issues like climate change, especially when it comes to technology vendors. Among the 1,600 executives surveyed, sustainability was cited as one of the major factors in selecting an ERP provider. In fact, 56% of organizations find that cloud uses less energy than similar on-premises systems in a datacenter. One CIO stated, “Oracle Cloud ERP usage provides us the ability to show less datacenter use, allowing them to report better energy usage.”

For on-premises customers concerned about the upfront project costs of moving to cloud, Oracle has recently introduced a new offer that lets customers convert upfront consulting and implementation fees into post-go-live monthly or quarterly payments.

Business benefits of cloud ERP

Companies that have embraced this digital transformation are receiving great IT and business benefits as well, ranging from shorter financial close times to faster merger integrations. Customers cited their favorite benefits of Oracle Cloud ERP in Moving to Cloud ERP: What’s Behind the Migration Momentum.

Greater return on investment. Because of the speed and scale afforded by SaaS, Oracle Cloud ERP customers have a project ROI that is 4 times higher than on-premises ERP. One CIO said, “If we had stayed on our on-premises ERP system, we would not be in business with the costs we would have incurred to keep it up to date.”

Faster merger integration. One CIO told IDC, “Bringing the business into a common and constantly up-to-date ERP platform has enabled us more agility in our mergers and acquisitions. Synergies and integrations are easier and divesting business is even easier now, too.”

Automating mundane processes. With built-in machine learning and an AI-powered digital assistant, automation dramatically improves. When asked about the biggest benefit of cloud ERP, one CIO told IDC, “The biggest area of improvement using Oracle Cloud ERP was the reduction of human manpower needed to process large masses of data. Now our employees can simply gain insights instead of spending hours sifting through the data to understand it.”

“While JDE has served us well, one challenge we were finding was getting data out of the system quickly enough to inform decision-making,” says Rob Janek, CIO of CTB. “Our business users had to rely on the IT team to generate reports, and then once they got the data, they had to spend time checking it over. We were spending about 80 or 90 percent of our time and effort getting the data, and 10 to 20 percent acting on it. We wanted to flip that ratio.”

One cloud platform. The simplicity of Oracle Cloud ERP gives customers consistency across UX, processes, planning and analytics, data, and cloud service delivery. Because of this common data model and pre-built APIs, data can be easily shared across applications. This allows customers to achieve company-wide, connected planning across different lines of business. A vice president of enterprise applications at an energy company said, “The benefit of Oracle Cloud ERP is the standardized processes—one system, one tool, and one source of data.”

Because Oracle Cloud ERP comes with automatic quarterly upgrades, our customers are getting a better solution every 90 days: more accurate cash forecasting, tighter security, and more automation. The difference between on-premises and cloud ERP couldn’t be starker.

With over 8,500 customers worldwide and counting, Oracle Cloud ERP is leading the shift from on-premises ERP to cloud, and more and more customers are coming along for the ride. Will you join?

Read the full IDC papers , IDC White Paper, Moving to Cloud ERP: What’s Behind the Migration Momentum and IDC Technology Spotlight, Overcoming Barriers to Cloud ERP.

Jonathan Burdett

Product Marketing Analyst, Oracle

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