Oracle Survey Finds that Operational Siloes Hinder Effectiveness of Cloud Applications
Broad Set of Integrated, Cloud Applications Help Organizations Reduce Operational Inefficiencies and Innovation Challenges
Redwood Shores, CA – May 14, 2013
Organizations are looking to the cloud to change not only how they buy and consume IT, but also how cloud actually impacts the business. In fact, one of the main drivers for organizations deploying cloud applications is to improve operational agility and effectiveness. To determine if cloud applications are delivering on this promise, Oracle partnered with market research firm Dynamic Markets to survey 1,355 executives from companies across the world with revenues of $65 million or more. The results showed that operational silos are often preventing organizations from realizing the promise of improved business performance and highlighted the need for a broad set of integrated cloud applications.
Today Oracle announced the results of a “Cloud for Business Managers: the Good, the Bad, and the Ugly” report, which found that the majority of businesses around the world have not yet adequately integrated their cloud applications across their business functions. Due to this, many have reported operational inefficiencies and challenges around innovation.
The independent market research report by Dynamic Markets details interviews with 1,355 senior decision makers from businesses globally. Respondents were selected from a wide range of business functions including R&D, Sales/Commerce/E-commerce, Marketing, CRM, Finance and HR.
The report found that:
Over half of respondents (54 percent) say their department has experienced staff downtime in the last six months due to cloud integration problems. In fact, departments not even using cloud apps have been affected by their colleagues that are.
Over half of businesses (54 percent) have suffered from missed deadlines and three quarters of respondents (75 percent) have had their ability to innovate impaired by poor integration of their cloud applications, which has left applications isolated from the rest of their business functions.
This is despite the fact that for the majority of businesses one of the main drivers for deploying cloud applications is to improve operational agility and effectiveness.
The impact of poor cloud integration on business productivity: Over half (54 percent) of businesses stated that their department has experienced staff downtime over the past six months due to cloud application integration problems, with departments not even using cloud applications among those affected. A further 54 percent said project deadlines had been missed in the past six months due to similar problems around the lack of application integration.
Application siloes proving a challenge for innovation: The vast majority (83 percent) of businesses have been prevented from getting the best out of their departmental cloud applications, with one in four blaming poor integration with other applications. Importantly, 75 percent said their ability to innovate using cloud applications has also been hindered, with one in two (53 percent) citing a lack of integration. Being unable to integrate the cloud application with other software owned by the company (36 percent) was highlighted as a particular issue, followed by being unable to customize the cloud application to meet company specific needs (33 percent).
Promise of cloud failing to materialize due to business process siloes: Over three quarters (76 percent) of businesses stated that their motivation behind deploying cloud applications was to get quick access to software, while 47 percent did it to get access to more appropriate software for their department. This contrasts dramatically with the reality of their experience and highlights the importance of getting business processes and applications out of organizational siloes.
Businesses aiming for better application integration: The good news is that the majority of businesses have recognized the need to better integrate business functions and applications. The vast majority (81 percent) of companies stated that it is important that cloud applications are fully integrated with each other and with other software in the organization. While 50 percent claim to have integrated cloud apps where they are able to access cloud data in other departments directly from within their departmental business application, one in two departments are still unable to do this.
“Cloud applications have the power to dramatically improve business performance while reducing costs, but only if they can work across the business. For example, sales managers need to have their territory planning and quota management tools integrated with the Human Resource and Compensation applications in order to better drive behavior and achieve sales goals. Subscribing to a cloud service may be relatively straightforward, but how this application fits in with the rest of the enterprise, including on-premise systems and other cloud applications must be thought through,” said Rex Wang, vice president of product marketing, Oracle. “Oracle’s Cloud portfolio has been built with this in mind, enabling us to provide integrated cloud solutions for the whole enterprise. This is a unique capability which means that our customers can source all of their cloud requirements from one place and deliver integrated processes across all their lines of business.”
1,355 surveys were collected from companies with revenues of $65 million or more. All respondents confirmed prior to interview the size of their organization by turnover, as well as their job role/department and level of seniority within it. The research was conducted by independent market research consultancy, Dynamic Markets. Businesses were surveyed in the following countries: Australia, Brazil, China, France, Germany, Hungary, India, Italy, Nordics, Russia, Singapore, South Africa, Spain, Turkey UAE, UK, and USA.
Oracle engineers hardware and software to work together in the cloud and in your data center. For more information about Oracle (NASDAQ:ORCL), visit www.oracle.com.
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