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Executive Viewpoint: Freeing Up Resources for Innovation

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David Baum Sonny Singh

David Baum spoke with Sonny Singh, senior vice president of the Oracle Industries Business Unit, about the challenges and opportunities CIOs face in managing the complexities of today’s IT environments.

Baum: Companies deploy information systems to simplify and automate their business operations. Why is there so much complexity in these IT environments?

Singh: The problem exists because companies have assembled their data center infrastructure and application architecture by piecing together and integrating different technologies built on different standards, followed by different upgrade cycles. They consume four times the amount of resources to just “keep the lights on” – integrating, configuring, testing, and tuning custom-built systems – as they do on business growth and innovation.

Baum: How are CIOs addressing this situation?

Singh: The only way CIOs can reduce the share of budget dedicated to maintaining the status quo is to simplify their IT infrastructure. They need to develop a strategy for eliminating IT complexity in order to free up resources for growing and differentiating their business. Oracle is investing aggressively in helping companies achieve this goal. Oracle offers customers the broadest portfolio of best in class products at every layer of the hardware and software stack, as well as a choice of deployment models including private cloud, public cloud and hybrid options. By engineering these best in class hardware and software components to work together – not as an afterthought or workaround, but from the ground up – Oracle frees IT organizations from the day-to-day maintenance and lets them focus on applying new technologies to their business. The more CIOs take advantage of Oracle’s integrated technology stack, the more they benefit from our investments in engineering – and the more room they have to address critical business issues.

Baum: What are the key issues CIOs are confronting?

Singh: The primary focus of CIOs is to deliver technology that supports the mission critical capabilities of their business. Mission critical capabilities are those that create differentiation and drive value such as transforming the customer experience, ensuring the efficiency of core business operations and driving better business outcomes with analytics and Big Data. In addition, we are witnessing the confluence of a number of transformational technologies such as cloud, mobile and social that are helping companies reinvent their business models and drive competitiveness. CIOs are racing against time to understand and deploy these technologies to transform their business.

Baum: Let’s take these in turn. What does “customer experience” mean today?

Singh: Customer experience is all about how companies acquire, serve and retain customers and drive customer loyalty. Our research shows that there’s plenty of room for improvement in this area. Right now, only one percent of consumers are satisfied with their customer experience, which means that 99 percent are up for grabs. Nine out of 10 customers will actually change suppliers after a bad experience. And they will tell others, compounding the damage to the seller’s reputation.

Baum: What can companies do to increase customer satisfaction?

Singh: Customers become frustrated whenever a seller requires them to repeat steps or re-enter information. It’s not enough to support multiple channels; companies need to create a seamless customer experience across channels. They also need to provide personalized attention; customers want the seller to know who they are, understand their specific needs and requirements, and make suggestions and promotions based on those needs. And when customers commit to an order, they expect flawless execution and efficient customer service. The customer’s loyalty is based on a seamless experience throughout the customer life cycle from evaluation to buying to service.

Baum: How does Oracle provide a seamless customer experience?

Singh: Oracle offers a comprehensive suite of best-in-class customer experience solutions including CRM, e-commerce, customer service, web experience, portal, store inventory, point of sales, social marketing, social commerce and social selling. These solutions are more than just best in class, they’re connected. They work together across channels to create a seamless customer experience from the time a customer researches, selects and buys a product or service, to the point when she receives, uses, maintains and recommends a product.

Baum: Switching topics, what do you mean by core business operations?

Singh: Core business operations are those processes that differentiate a company from the competition, whether it’s product and service development, operations and fulfillment, or revenue capture. Unlike general and administrative functions, core business operations are specific to a particular industry and therefore not addressed by standard ERP applications. Until now, IT had the task of building industry-specific capabilities themselves. If you were in the retail industry, you acquired planning and merchandising, point of sale, and profit optimization systems from different vendors and integrated them yourself. If you were in the public sector, you assembled your own public safety, tax, and social services systems. No matter what industry you were in, you had little choice about how to support your unique business requirements other than taking on complex IT projects like these.

Baum: How does Oracle help CIOs address the unique challenges in their industry?

Singh: Oracle offers complete, integrated solutions that address complex business processes relevant to a wide range of industries. Our industry strategy starts with building in industry functionality at every layer of the stack, such as warranty management for manufacturing, case management and accounting for public sector, HIPAA compliance for healthcare, and industry-specific data models for airlines, communications, and retail. To add depth to this functionality, Oracle invests in best-in-class industry specific applications, either built by us or acquired. Today, we offer a broad portfolio of the leading solutions in specific industries, such as communications, financial services, health sciences, retail, manufacturing, and utilities. Finally, we bring all this together to deliver end-to-end industry solutions including rapid offer design and order delivery for the communications industry, tax and revenue management for the public sector and smart grid for the utilities industry.Baum: We hear a lot about Big Data. Is this hype or reality?

Singh: For decades, companies have used transactional information to drive business decisions. Today, in addition, we are generating huge volumes of unstructured data from a variety of sources like social media, weblogs, sensors and images. This Big Data, that is growing by 2.5 quintillion bytes (or 2.5 exabytes) every day, could be a gold mine of competitive value – but the challenge is harnessing and gaining insight from the data. Ninety percent of executives believe their organization is losing revenue because they’re not able to leverage the information they have, whether it’s operational data or Big Data.

Baum: How does Big Data deliver value and how should CIOs respond?

Singh: By harnessing digital assets from mobile devices, e-mails, social media and sensors, businesses can gain new perspectives on customers, markets, partners, costs and operations. While Big Data has the potential to deliver measurable value to the business in terms of both customer intimacy and capital efficiency, it also introduces new complexities for IT.

These large volumes of data generated at high velocity put more stress on system performance. With the advent of social networks like Twitter and Facebook, a different set of tools is required to handle new data types such as videos and pictures. Users can gain unique insights from all this data, but they have to search through gigantic datasets in order to extract the elements of value that will make a difference in day-to-day business. They need a completely new class of infrastructure that can handle the performance requirements, new tools to acquire and organize both structured and unstructured data, in-memory processing for real time decision support and discovery and a completely new class of analytics to uncover the patterns and inter-relationships found in all this data.

Baum: How does Oracle simplify the analytics lifecycle?

Singh:Oracle has Big Data solutions that address every stage of the data lifecycle – from acquiring, organizing, and analyzing data to determining a course of action. These innovative hardware and software products like the Big Data Appliance, Exadata, Exalytics, Advanced Analytics, Oracle Information Discovery and Oracle Business Analytics deliver a complete set of capabilities to help companies extract value from Big Data. Oracle Business Analytics not only has capabilities unique to Big Data, but it also easily integrates with existing systems so companies can analyze all their enterprise data together. With real-time, speed-of-thought visual analysis, users can see trends, patterns and insights like never before.

Baum: Cloud computing is the latest rage, but have first-generation cloud solutions lived up to their promise?

Singh: Cloud technologies are changing the way companies consume IT services. However, significant gaps in first generation clouds have generated a lot of hidden costs. Because each distinct cloud offering addresses only a small fraction of an enterprise’s requirements, 40 percent of companies report that the result is a siloed environment where the onus of integration falls back on their shoulders. More than 62 percent of them report a loss of visibility and control over their data, and they find themselves locked into silos on proprietary technologies. In addition, over eighty percent of companies cite security as a key risk in cloud deployments. Even though a company has well-established security policies and procedures, they may not apply to external cloud deployments.

Baum: How does Oracle bridge these gaps?

Singh: Oracle has fundamentally changed the definition of how cloud technology is offered to customers. With Oracle’s next generation cloud, customers have access to the most comprehensive suite of integrated services, eliminating the data and business process fragmentation that come with cloud silos. Oracle also provides complete data isolation to ensure data privacy. The benefit of having complete data isolation is that customers can choose from different deployment models as well as set their own upgrade schedule.

Baum: What are Oracle’s latest cloud solutions?

Singh: Oracle now offers the broadest cloud functionality in the industry including applications as a service, platform as a service and infrastructure as a service. Oracle Cloud Application Services include ERP, human capital management, talent management, sales and marketing, customer experience, planning and budgeting and financial reporting – all integrated with Oracle Cloud Social Services so that customers can adopt social capabilities throughout the enterprise. Customers can utilize Oracle Cloud Platform Services such as Java services, database services and developer services to deliver extensions that can add value to cloud applications. They also have access to Oracle Cloud Infrastructure Services for compute and storage needs.

Baum: Concerns about security have stymied some cloud deployments. How does Oracle address this issue?

Singh: First generation clouds used a multi-tenancy configuration as a cost-saving measure, but a co-mingling of data among customers resulted in significant security and performance gaps. In contrast, Oracle Cloud is built on a modern virtual tenancy architecture that ensures complete data isolation through either dedicated virtual machines or virtual private databases. Not only is each company’s data secure, Oracle’s architecture makes it possible for each company to decide its own upgrade window and deployment model.

Baum: How does Oracle accommodate the mobile enterprise?

Singh: Like first generation clouds, mobility presents security and integration challenges for IT as more employees use personal devices for some, or even large, elements of their work. Oracle’s mobile strategy tackles the challenges of securing enterprise data, integrating mobile applications to enterprise applications and supporting multiple devices and platforms through a combination of a common development platform and mobile applications designed for different types of users. Oracle’s mobile platform lets companies develop their applications once and then extend them to both mobile use and enterprise use – as well as to multiple device types. Changes to the enterprise application are automatically propagated to the mobile applications. Security is maintained at all critical points, including authentication at the device level and securing data in motion between the device and the enterprise.

Companies can not only extend and deploy applications on mobile devices but also build their own applications for their specific business needs. In addition, Oracle offers a range of mobile applications including task-based applications for every major product line as well as a single tablet application that lets users access Fusion Applications.

Baum: What is the impact of social technologies on business today?

Singh: Earlier we discussed how consumers talk about brands on social networks, and yet the majority of marketers lack insight into these social media conversations. The proliferation of social media channels and technologies makes it difficult for companies to orchestrate interactions with customers across these different channels, monitor their reactions, listen to their feedback and respond quickly.

Baum: How is Oracle helping companies keep pace with the changing social media landscape?

Singh: While marketing has been the first to adopt social technologies in the enterprise, other areas of the business will soon follow. The social enterprise is about building personal and engaging relationships with customers – as well as partners, employees and candidates. With Oracle Social Relationship Management Suite, customers can now drive this fundamental social transformation into the enterprise by integrating social capabilities with marketing, sales, services, human resources, talent management and ERP business processes.

Baum: What is Oracle’s overall strategy to help CIOs keep up with rapid technological change?

Singh: With Oracle’s integrated technology stack, IT organizations can adopt transformational technologies quickly and efficiently without worrying about how they will integrate with the rest of their system. In addition, CIOs have the unique opportunity to ensure cloud, mobile and social technologies are secure, reliable, and integrated into enterprise business processes.

David Baum is a freelance business writer and marketing consultant with 25 years of experience covering the high tech industry.