Oracle Application StrategiesDecodedOracle licensees cOntinue tO leverage Mature On-PreMise aPPlicatiOns rather than Migrate tO clOud/FusiOn

Introduction

As Oracle focuses investment and mindshare primarily on its cloud and software-as-a-service (SaaS) applications in a rapidly evolving ERP software landscape, on-premise licensees are left with an unclear picture of future Oracle application roadmaps, including possible Oracle upgrades.

Rimini Street recently commissioned a global survey of Oracle licensees using on-premise applications -- including E-Business Suite, JD Edwards, PeopleSoft, and Siebel -- to understand their challenges, priorities, and plans for 2016 and beyond.

This ebook highlights key findings from 443 Oracle licensees as they plan their Oracle application strategies and roadmaps for 2016 and beyond.

Demographics

29.6%

11.5%

9.3%

9%

5.6%

5%4.7%

VP of IT

9%

6%

5%

IT Manager Director of IT

CEO VP of IT CIO

Other Procurement

CFO

30%

25%11%

9%

5%443Worldwide Respondents

Survey respondents comprised current Oracle application licensees representing a range of industries and company sizes in North America, Asia-Pacific, Europe and the Middle East.

Key Findings

Oracle Licensees Continue to Leverage Mature On-Premise Applications

CIOs are carefully assessing and selectively using cloud technologies to innovate around the edges of their existing software investments. Survey results confirm that Oracle licensees are continuing to leverage and benefit from their mature on-premise applications to run core business functions, and are considering options from several vendors, aside from Oracle, to extend their on-premise investments with new functionality and capabilities.

THE BOTTOM LINE: The majority of Oracle licensees surveyed continue to leverage and seek benefit from their existing on-premise applications.

Respondents say

another top reason for not migrating to Oracle Cloud/Fusion applications is they provide no incremental value over existing applications

of respondents

cite high licensing and maintenance costs

62%

60% of respondents

see no strong business case to migrate to Oracle Cloud/Fusion applications

TOP REASONS respondents cited for not migrating to Oracle Cloud/Fusion applications include:

Many Oracle Licensees Are Not Committed to Upgrading Current On-Premise Applications

Oracle licensees are critically evaluating whether there is a clear business case to devote significant time, money, and resources to upgrade projects.

Nearly half of Oracle licensees surveyed are running at least one version behind the latest application release, with a significant portion questioning the value of expensive, disruptive upgrades and change for the sake of change.

THE BOTTOM LINE: Respondents’ application roadmaps and strategies lean towards extracting maximum value out of their existing systems and platforms, avoiding expensive, unnecessary upgrades, and re-platforming without a solid business case.

50%of respondents are

running at least1 version behind the latest Oracle release with many Oracle licensees questioning the value of expensive, disruptive upgrades and change for the sake of change

NEARLY 64%of respondents

say their stable, mature on-premise applications meet current business needs

41%of respondents

believe Oracle upgrades are cost-prohibitive

Licensees Frustrated with Oracle Annual Support

Many Oracle licensees question if they are receiving fair value for their annual Oracle support and maintenance contracts. These contracts are typically calculated at the Oracle standard rate of 22% of the original cost to license the software.

Respondents also say they continue to struggle with the inefficiencies of the vendor support model.

“Pricing doesn’t decrease as they reduce support for older versions.”

“The answer to any support issue seems to be ‘Upgrade’.”

THE BOTTOM LINE: IT ends up wasting precious time and resources to compensate for inefficiencies in the vendor support model instead of focusing on strategic projects.

“Please hold, your call is important to us...”

challenge respondents face is being required by Oracle to upgrade to the latest release to resolve a support issue in their current release

THE# 1

Explaining the same issue multiple times

Being asked to reproduce the issue to prove its validity

Additional challenges faced with Oracle vendor support model inefficiencies include...

HELP!

Conclusion

Customers Want More

Numbers very rarely lie.

These findings shows that most customers want maximum value from their stable and mature on-premise applications.

Given that most new Oracle capabilities and features are reserved for Cloud/Fusion applications, licensees can look to one of the following strategic recommendations as they plan for their next-generation application strategy.

Existing, stable, and mature E-Business Suite, JD Edwards, PeopleSoft or Siebel application platforms include rich, potentially untapped function-ality that, when leveraged, can continue to meet the majority of your business needs for the next10 to15 years.

Look for ways to reduce costs while maintaining your core “systems of record” by considering alternatives like independent support. Future-proof the life of your existing application investment, including interoperability and customization support with the flexibility to upgrade on your own timeline.

1. Maximize your investment in existing, stable, and mature on-premise applications.

Innovate around the edges of your on-premise applications by integrating best-of-breed “systems of engagement” applications like mobility, big data, and cloud solutions.

Many vendors, including Oracle, provide add-on features and capabilities that do not require any upgrade to your existing, core applications or a migration to Oracle Fusion/Cloud.

Shift funds from current, on-going operations and maintenance to invest in new technologies and innovation that will drive business growth.

2. Develop a Hybrid IT application strategy

Eliminate inefficiencies in the support process and benefit from higher service levels, faster response times, and support for customizations. Choose a provider that can not only ensure your systems run flawlessly and in full compliance, but also preserve your ability to update, evolve, and grow on your own terms.

Re-allocate limited time, money and resources towards projects that will help achieve strategic goals for your business.

3. Consider independent support to shift from “keeping the lights on” to innovation IT

Oracle Licensees Want More From Existing Applications

Survey results confirm that most Oracle licensees want to maximize the value and return-on-investment from their existing, stable and mature on-premise applications.

Given that most new Oracle capabilitiesand features are reserved for Cloud/Fusionapplications, Oracle licensees can look to one of the following strategic recommendations as they plan their next-generation application strategy.

three recommendations to get you started

Further Reading

Learn how today’s rapidly changing technology landscape and the onset of a Hybrid IT era can drive a vision for your next-generation ERP platform.

Download A Strategic Timeline for Next-Generation ERP now.

Download it now

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