2016’s Oracle OpenWorld is in full swing, with all the keynotes and product news that you would expect. What does it all mean for J.D. Edwards and PeopleSoft customers? The key takeaways I am hearing are about increasing business and IT agility via the Cloud, innovating in your business via technology to create competitive advantages, and improving operational excellence to cut costs.
I asked Thomas Kurian, President of Product Development, what Oracle’s on-premises application customers should know about Oracle product directions. First, Thomas advises PeopleSoft and JD Edwards customers to take a look at the latest releases. Oracle continues to deliver useful new capabilities.
Second, he recommends that customers consider migrating some or all of their environments to infrastructure as a service (IaaS) or platform as a service (PaaS) clouds. About 100 customers have moved their on-premises applications to the Oracle Cloud.
Third, once you have made that move to the cloud, you can consider adding more ERP modules that you will run the in the cloud – or augment your in-cloud JD Edwards or PeopleSoft ERP with new software as a service (SaaS) applications.
Mark Hurd shared in his keynote that “The cloud is a generational shift. It sits at the intersection of people and success. It is a vehicle that harnesses the power of what we [as individuals and companies] do and gives us the perspective and tools to lead the future on a global level.”
He noted that growth in enterprise IT spending has been basically flat in recent years. Consequently, most current IT assets are old. How old? The average age of corporate software is 21 years, I presume from the date of original purchase, running on five-year-old infrastructure. In contrast, consumer IT spending in recent years has practically quadrupled. Now, consumers and employees expect more. At the same time, security demands are growing. Concurrently, corporate budgets for innovation are small and declining. Companies that are moving to the cloud are seeing an overall cut in the total cost of ownership (TCO) of about 33%.
All of those changes add up to a “generational shift” in information technology. With the cloud, business experience lower IT costs, new IT capabilities, and faster business innovation in business processes and economic models.
At OpenWorld in 2015, Mark Hurd made some interesting predictions for IT in 2025. Here are a few highlights worth revisiting:
* By 2025, 80% of production applications will run in the cloud
* Two business application suites will own 80% of the enterprise SaaS market
* 100% of enterprise Development and Test environments will run in the cloud. Update: now in 2016, 40% have already moved or are under consideration for migration to the cloud.
This year, Mark added some new predictions for 2025:
* 80% of IT budgets will be spent on cloud operations, not traditional on-premises computing
* The number of corporate-owned data centers will drop by 80% (leaving only old legacy systems)
* CIOs will spend 80% on innovation, not maintenance. That’s mostly a business benefit, bringing new ways to gain share, engage customers, and launch new products
In conclusion, Mark Hurd shared Oracle’s top two product strategies for helping businesses. First, Oracle is working to deliver best of breed (BoB) applications that operate as a suite. Second, Oracle is delivering infrastructure & platform services that get customers out of running their own data centers to get more flexible and cut costs.
Want to dive deeper? My next articles will go into more detail about JD Edwards and PeopleSoft product directions and conference sessions.– along with interesting insights from Safra Catz, co-CEO of Oracle.