Monday, 11 February 2019 15:00

Oracle seeing big SaaS growth in Australia

Oracle general manager for ERP/EPM SaaS John Leonard Oracle general manager for ERP/EPM SaaS John Leonard

Oracle's SaaS business is enjoying 100% year-on-year growth in Australia, Oracle general manager for ERP/EPM SaaS John Leonard told iTWire.

Five years ago, many of Oracle's SaaS customers were relatively small – SaaS had put the company's products within their reach when the on-premises equivalents were not. For instance, some local councils that use Oracle SaaS would not have been able to afford the capital cost of on-premises systems, Leonard said.

Now, established users of Oracle products such as PeopleSoft and E-Business Suite users — including government agencies — are moving from on-premises to SaaS.

While Oracle's "applications unlimited" policy means on-premises applications, including JD Edwards and PeopleSoft, will see continuing development until at least 2030, customers can modernise their systems by switching to the Oracle Fusion SaaS equivalent.

Nearly every project is delivered within 12 months, said Leonard, with most completed in four to eight months.

An on-premises upgrade can cost as much as $20 million for a large organisation, so switching to SaaS is a lower-risk option. "Upgrades are costly and risky" but they are "no longer part of the ERP world if you're on Oracle", he said.

SaaS also makes it easier to adopt new technologies such as blockchain, because features are added to each quarterly release.

Around 2012, most of Oracle's CRM customers were using on-premises software, but by 2016 most were on SaaS. A similar shift is now happening with HR and finance software, he said. "We've got this really unique differentiator" in that Oracle operates a true SaaS platform, where its competitors use a "managed hosted" model.

Local customers include supplements vendor Blackmores, investment company QIC, online wine seller Vinomofo, funeral company InvoCare, fast food chain Hungry Jack's, and the University of Wollongong.

As part of a push to encourage more customers to move to SaaS, Oracle offers an arrangement whereby its consulting operation does the work and customers pay on delivery. That's "a pretty good offer", according to Leonard.

ERP is "a huge priority for Oracle" in terns of SaaS during 2019, he said, but the company will also be pushing SaaS HCM, encouraging PeopleSoft and E-Business Suite HCM customers to move to Fusion.

Most SaaS competitors offer point solutions (eg, CRM only or HR only), he said, but all of Oracle's SaaS applications share the same codebase and data model. Companies will look for providers that cover the whole of their businesses rather than one particular area, Leonard suggested.

Another advantage of SaaS is that it allows one to see what's happening with the software, but without being able to see customers' data. So it's possible to identify emerging latency issues before customers notice, and to detect trends such as IoT adoption, and respond quickly.

And when customers agree to be beta users of new functionality, this telemetry provides immediate feedback, and in some cases this means the new feature can be finalised in time for the next quarterly update. This is only possible with SaaS, he said, "and you keep iterating".

SaaS is "the quickest way to get innovation into customers' environments", providing "an enormous competitive advantage".

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Stephen Withers

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Stephen Withers is one of Australia¹s most experienced IT journalists, having begun his career in the days of 8-bit 'microcomputers'. He covers the gamut from gadgets to enterprise systems. In previous lives he has been an academic, a systems programmer, an IT support manager, and an online services manager. Stephen holds an honours degree in Management Sciences and a PhD in Industrial and Business Studies.

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