Building a Better Cloud

Oracle delivers a new generation of cloud software and services.

by Anne Ozzimo, November 2011

Early software-as-a-service (SaaS) solutions were designed to service a single function or line of business, with little thought to how they would support an organization’s broader business objectives. Today, the proprietary legacy architectures, immature integration technologies, and limited solution footprints of niche SaaS vendors have generated multiple cloud silos that limit the ability of organizations to fully reap the benefits of cloud computing.

Disparate platforms and multiple approaches to managing applications and IT services drive up the cost and complexity of integrating and maintaining applications, effectively eliminating over time any up-front savings earned from low-cost subscription services and exposing organizations to operational and security risks. And because it’s left up to customers to integrate their SaaS solutions with enterprisewide business processes and analytics, it’s often the niche SaaS vendor that benefits most from the economies of scale provided by the cloud.

“The ability to get relevant, timely, and accurate enterprisewide business information using niche SaaS solutions is really difficult,” explains Steve Miranda, senior vice president of applications development at Oracle. “Their platforms and data models are proprietary and don’t integrate easily into existing IT infrastructure. And they’re not built on open standards, so it’s difficult to tailor business processes to meet unique industry demands.”

Oracle product strategists and developers have long believed that there is a better way to run applications in the cloud. Customers can realize multiple benefits using Oracle’s cloud platform, a fully integrated stack of enterprise-grade cloud software and services. Oracle Fusion Applications, a new class of next-generation applications, is designed to deliver an entirely new level of performance in the cloud, leveraging a single code line built on open standards to offer customers unprecedented flexibility in deployment options, extensibility, and integration. Each layer of Oracle’s enterprise-grade cloud platform has been engineered to work together seamlessly and openly in the cloud, bypassing the limitations of niche SaaS solutions and unlocking the true potential of cloud-based applications.

Limitations of Niche SaaS Solutions

Standalone SaaS solutions found in the market ironically limit businesses rather than liberate them. They establish data silos, fragment business processes, and create integration complexities that introduce new long-term costs and risks and limit worker productivity. These problems undermine any efficiencies gained through the cloud’s virtualized and shareable infrastructure.

“Limited cloud solutions are becoming a point of frustration in our customers’ infrastructure,” says Chris Leone, group vice president of ERP application product strategy at Oracle. “As more customers build cloud-based business processes, they’re asking for broader, end-to-end business processes, extensibility on a standards-based platform, and more accountability over the entire stack, from applications to disk.” The power of the cloud is thwarted by the following limitations:

Incomplete solutions. The limited product footprints and functionality of niche SaaS vendors mean customers must deal with multiple systems and partners to create end-to-end business processes. Fragmented business processes, inconsistent user interfaces, and disparate data infrastructures all increase total cost of ownership, requiring investments well beyond the original SaaS cost to resolve. The additional work required for users to traverse disparate infrastructures also saps productivity and innovation.

This lack of integration also means information can end up trapped in multiple data silos, making it difficult to get a consistent view of business intelligence required in today’s data-driven economy. And since most niche SaaS vendors don’t offer historic, predictive, or embedded analytics, users lose the ability to leverage information for competitive advantage—unless they incur additional expense.

Proprietary platforms. Making business processes more efficient can prove challenging with niche SaaS solutions that are not built on open standards. Customers may need to tailor SaaS applications to meet local regulatory requirements, but modifying a SaaS point solution often demands a large, complex API that is subject to constant change. Users cannot take advantage of standard off-the-shelf tools to help with enterprise reporting, business intelligence, data warehousing, and other common processes. And the proprietary nature of some niche SaaS vendors’ object models makes it difficult to migrate back to an on-premises solution.

Security and privacy risks. Niche SaaS solutions add new security risks associated with managing single sign-ons from multiple vendors. Not having a common security model can be risky and costly. Oracle calculates a company of 10,000 employees will spend an additional US$200,000 over five years to manage and maintain system logons, passwords, security roles and permissions, workflows, and approval and auditing processes. Companies with global operations must also ensure that SaaS solutions comply with data privacy regulations of local geographies.

Limited vendor accountability. In the January 2010 article “Why You Need a SaaS Strategy,” InformationWeek predicted that niche SaaS vendors’ lack of accurate measures of service levels inside customers’ operations will ultimately shift responsibility to monitor and manage SaaS application performance back onto customers. Having multiple SaaS vendors compounds this issue, as customers must themselves maintain critical provisions such as performance reliability, disaster recovery, and data ownership.

Next-Generation Cloud Applications

Real enterprise business problems require more-powerful solutions, more choice of deployment options, and greater vendor accountability. Oracle built Fusion Applications to address these needs, working with thousands of business users and IT experts for more than five years to develop a complete cloud software portfolio that delivers the true benefits of cloud efficiencies with the least cost, complexity, and risk. Oracle’s cloud portfolio consists of multiple application families and a consistent user interface, data infrastructure, and common security model across all applications. The combination of Oracle Fusion Applications and Oracle’s end-to-end cloud services can help companies achieve real business results quickly and cost effectively, while preserving freedom to choose deployment location, upgrade path, and application modules.

Oracle Fusion Applications are an integrated suite of 100 modules across seven product families, which can be adopted in a modular fashion for rapid business innovation without the fragmentation challenges of niche solutions. Oracle Fusion Applications product families include Oracle Fusion Customer Relationship Management; Oracle Fusion Financials; Oracle Fusion Governance, Risk, and Compliance; Oracle Fusion Human Capital Management; Oracle Fusion Project Portfolio Management; Oracle Fusion Procurement; and Oracle Fusion Supply Chain Management.

Oracle Fusion Applications deliver a role-based user experience with business intelligence and collaboration capabilities built into the context of the work at hand. “We created every Oracle Fusion Applications screen by asking, ‘What does the user need to know?’ ‘What does he or she need to do?’ and ‘Who do they need to work with to get the job done?’” Miranda explains. “When the sales department needs new laptops, the self-service procurement screen displays a list of approved vendors and configurations, but also a running list of reviews by coworkers who recently purchased the various models.”

Users also have the ability to tailor Oracle Fusion Applications to the way they like to work, creating personal workspaces by using a browser-based, drag-and-drop composition environment to integrate other applications and systems. Additional fields can be added to business processes, and steps can be removed or changed—all without involving IT. And all changes will remain safely in place through upgrades.

Oracle Fusion Applications leverage a common data model and master data management to deliver historic, real-time, and predictive analytics across the enterprise. Business intelligence is embedded into the transaction layer to bring information into the user’s daily work. With actionable information at their fingertips, all kinds of users—from transaction workers to business users and corporate executives—can make better operational decisions and continually align those decisions with the organization’s corporate, financial, and operational strategies.

Whether customers choose one module or the entire suite, Oracle Fusion Applications are designed to coexist with current applications, using coexistence solutions that support the most-popular business flows between Oracle Fusion Applications and solutions in other Oracle Applications lines. Organizations not only get access to standard tools for integration; they also have access to a large IT talent pool trained on the most-current engineering techniques.

Oracle Fusion Applications use a modular approach that supports a complete set of deployment options—on premises, public clouds, private clouds, and hybrid public/private clouds. This gives customers the flexibility to scale up, scale down, or make changes quickly. At the same time, powerful and intuitive management capabilities ensure that business needs are met and resources are available while reducing IT overhead costs.

Cloud-Ready Infrastructure

When it comes to cloud success, a unified technology stack enables standardization and delivers operational efficiencies and much lower operating costs. The Oracle cloud platform includes Oracle Database; Oracle Fusion Middleware; Oracle Enterprise Manager; Oracle VM; and Oracle’s Sun compute, storage, and networking hardware. Oracle developers engineer these systems to work together, integrating and optimizing them to deliver breakthrough performance, efficiency, scalability, availability, security, and manageability. Examples of engineered systems include the Oracle Exadata Database Machine and Oracle Exalogic Elastic Cloud. 

Additionally, world-class data centers with embassy-grade security and redundant environments are the backbone of Oracle Fusion Applications cloud deployments. Oracle operates world-class data centers around the world. The Austin Data Center is home to nearly 10 petabytes of storage and runs a complete and integrated stack of Oracle applications, platforms, and infrastructure software inside a 130,000-square-foot building.

More than 20,000 Oracle Service and 1,500 Oracle On Demand experts support Oracle Fusion Applications cloud deployments, with service in 27 languages. Oracle’s 200,000-square-foot data center opens in Utah in 2012 to support customers and provide infrastructure for the company’s research and development activities.

Proceed with Confidence 

With Oracle’s cloud strategy and offerings, customers can avoid the pitfalls and limitations of niche SaaS products and leverage years of knowledge, best-in-class capabilities, and solid reliability. 

Oracle’s Miranda, a 20-year software industry veteran, sees several developments bringing about an inflection point in enterprise computing—a move toward rapid adoption. Standards-based, service-oriented applications; user interfaces with embedded business intelligence and collaboration; pervasive enterprise mobile computing; and cloud computing all indicate this trend. “It really has a chance to change the way people do business and help determine who will be the winners and losers going forward,” Miranda says.

Product strategists and developers at Oracle—one of the world’s largest SaaS providers—created a cloud strategy with rapid adoption in mind, creating the ability to mix and match applications and deployment models based on unique business needs. This includes technology that enables customers to build private clouds for shared service centers or other applications; public clouds to subscribe to SaaS or platform-as-a-service offerings; and hybrid clouds to deploy some applications as a service and others in a private cloud.

“Only Oracle supports hybrid deployments, something that is unique in the industry,” Miranda adds. “So, you might want CRM [customer relationship management] in the cloud and financials on-premises. Oracle can support that. You might want SaaS now, but you want the option to change later if needed. Oracle can support that.”

For More Information

Your Cloud, Your Way
Oracle Cloud Solutions
Oracle Fusion Applications


Anne Ozzimo writes frequently on financial management topics.