Expert Advice for Medium and Midsize Businesses

ERP’s Move to the Cloud Continues to Gain Momentum

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By Kelly Fleskes, Marketing Director, North America Applications Consulting, Oracle

Did you know that nearly half of companies have moved at least one ERP function to the cloud? Are you one of them?

According to Gartner, “As of October 2018, almost half (47%) of recently surveyed Gartner customers have moved one or more ERP functions to the cloud.” It appears the migration from on-premises systems to the cloud continues to gain momentum.

Oracle introduced the Soar program for existing E-Business Suite and PeopleSoft customers and investment continues to incorporate additional on-premises applications. The intention is to make the transition from these on-premises applications to the cloud faster, and easier—an estimated 20 weeks from initiation of the service through data conversion to go-live.

The program interest prompted Gartner to publish a research note, “4 Things You Need to Know Before ‘Soaring to the Cloud’ With Oracle ERP Applications.” The note offers Gartner’s observations of the common challenges faced with a move to the cloud, and their recommendations to tune your strategies.

The Basics: What is Oracle Soar?

Soar is a packaged offering that combines conversion tools, data transformation services, training, consulting, and support to make the migration to Oracle ERP Cloud a relatively “hands-free” process. Evaluation tools inspect a customer’s database for workflows, organizations, configurations, customizations, and chart of accounts. Then consulting tools map these areas to business processes, financial data models, and configurations in Oracle ERP Cloud. These integrations and features replace the ubiquitous customizations that make patching, upgrading, and implementing on-premises software such a burden.

The Move to the Cloud and Soar’s Role

In addition to the insight provided in Gartner’s research note, recently I had an opportunity to catch up with Steve Reeter, GVP North America Applications Consulting, ERP Growth & Strategy, for his perspective on ERP’s move to the cloud and the role Soar plays.

“Customers view ERP as the portion of a business platform that ultimately represents the heartbeat of their business, and I agree with that important perspective. The financial applications enable how they report and measure the business. The supply chain applications directly enable and reach their customers, and ultimately their revenue,” states Reeter. “To move that heartbeat to the cloud, customers are seeking a comprehensive approach they can trust. Customers are identifying the economic and innovation value of the cloud and they want to feel equally confident with a trusted road map and approach.”    

When asked about Soar’s role in gaining trust and accelerating the move to the cloud, Reeter added, “We are not just moving systems, we’re moving enterprises. We're practitioners in the market, and what we directly observe is our customers needing more leveraged help and leadership to address the challenges and barriers to migrating their most critical business functions to the cloud. Soar emerged from that climate. We address key concerns such as business data migration and validation, enterprise integration, and business configuration. Everything we offer with Soar is deliberate towards removing these barriers and accelerating customer success.”

Gartner recommends that CIOs review four key areas when evaluating how to use Oracle Soar:

1.“Position as an opportunity to provide tools for business transformation.”

Oracle Soar helps to streamline the technical aspects of cloud migration. However, Gartner notes, “Organizations that treat a move to cloud applications strictly as a technical process risk losing out on business transformation opportunities.”

We believe this underscores Soar’s value proposition, which is not only about saving money and time on a cloud migration but also aligning your cloud ERP initiative with your overall business strategy.

One high-focus area where this advice might come into play is with the adoption of advanced technologies. Oracle’s product roadmap as listed in the Gartner report includes “artificial intelligence (AI), chatbots and conversational interfaces, advanced predictive analytics, and machine learning (ML)”—all embedded into Oracle ERP Cloud and designed to address specific business issues. If your organization’s strategy includes applying these technologies to everyday processes, this could be a compelling business case for using Soar.

2. “Evaluate Whether Your Customizations Deliver Truly Differentiating Capability Prior to Engaging the Oracle Soar Offering.”

Most on-premises ERP customers are using customizations because they’re running an older version of the software that didn’t include the desired functionality out of the box. However, over the years, customization sprawl has complicated application management for many companies and, at times, prevented organizations from using newly developed features and capabilities.

Customizations run counter to one of the basic value propositions of the cloud—regular updates, several times per year, based on best practices that continue to evolve and improve. Moreover, customizations are rarely needed in the cloud world. The Soar tools identify cloud features and configurations that can replace existing on-premises customizations.

Replacing customizations is high on the wish list of CIOs. Gartner cited its research to support this in the note:

“Customers are reporting that they are looking to cloud ERP vendors to deliver increased integration and functional capabilities. In fact, replacing customization is reported as the second highest requirement when implementing a new ERP solution, with integration capabilities ranked first.”

3. “Develop an integration strategy that incorporates multiple integration tools and master data management.”

According to the Gartner report, “An integration strategy that emphasizes web services and APIs will allow for greater reuse of integration programs and services while also managing the starting points and endpoints of the integration.” Gartner also points out that the integration strategy should extend beyond the Soar project:

“A good integration strategy will consider systems outside of the ERP and dictate how they should integrate, so that common methods and patterns can be adopted throughout the enterprise. The integration strategy will also tie in with a data strategy to eliminate data redundancies and focus on enforcing reliable data and ‘systems of truth’.”

4. “Prepare your organization for the amount and rate of change by adopting a product-management philosophy for ERP.”

When switching to a cloud application, you will need to alter expectations for how quickly applications evolve. Oracle releases changes frequently, automatically and in the background.

The rate of change for on-premises applications is much slower because the upgrade process is more difficult and relies on often-limited internal resources. With the cloud, these resources can be redeployed to support users through a continuous cycle of updates. 

Know No Limits 

When asked what he sees as he looks ahead, Reeter shared: “We’re excited about how far the Soar framework is taking us to serve our installed base initially, but ultimately we will address other new segments. We’ll make the cloud more accessible to more customers. Soar addresses the critical challenges and barriers to the cloud—the business data, integration, and setup. Soar enables customers to imagine—or rather reimagine—the roadmap to the cloud. Once a customer is in the cloud, transformation and innovation know no limits. Customers can stand on the shoulders of real innovations, future-proof their business, and focus their energy on customers and growth.”

Download the Gartner research note, “4 Things You Need to Know Before ‘Soaring to the Cloud’ With Oracle ERP Applications.”

Gartner, “4 Things You Need to Know Before ‘Soaring to the Cloud’ With Oracle ERP Applications,” 20 December 2018, Tim Faith, Alan Stanley

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