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In recent earnings calls, Oracle Chairman and CTO Larry Ellison explained how many companies have switched from SAP to Oracle Fusion Cloud Applications. Initially, 100 companies were identified, and in the 2021 fourth quarter earnings call1, the total number of companies that replaced SAP with Oracle has grown to more than hundreds.
The investments that companies have made in SAP ERP were very significant. So why would these companies decide to switch? What are these companies getting from Oracle that they don’t seem to get from SAP? And how does the transition work? Let’s take a deep dive.
By hosting an older solution on a public cloud or hyperscaler platform, these vendors will claim they are providing both a public cloud and a private cloud version of their apps. However, most buyers see this repackaging for what it is. It’s an old product being tarted up and not a real cloud-first application solution.
"How Oracle's latest announcements change multi-tenant vs on-premises decisions,” 16 Sept 2020
Legacy way of working
Why this matters
Periodic updates keep apps up-to-date with the latest new and technology.
|Few disruptive upgrades
The software is almost continuously outdated.
|Continuous innovation through periodic updates, both in applications as well as platform. Ability to opt-in to new features. Upgrades of legacy applications are so disruptive and costly, that most companies postpone them (sometimes indefinitely).|
Every module can be implemented separately.
ERP must be implemented first.
|ERP is typically optimized for Finance and typically doesn’t cater for sales, marketing, service, production, logistics etc. With an ERP-centric environment, customizations become a necessity to support the needs of sales, marketing, service, production, logistics (or alternatively: multiple instances of the same software). Customizations are costly and hinder upgrades. Companies use outdated software as a result, which increases security risks, and adds to the cost once upgrades become inevitable.|
|Structured and unstructured data
Combined seamlessly inside applications.
|Requires separate applications
for structured and unstructured data.
|Unstructured data (photos, videos, spreadsheets, PPTs, PDFs, etc.) form an integral part in modern business. Using separate applications for structured and unstructured data means that users cannot relate the two. It makes business processes and decision making suboptimal.|
|For all organization sizes
Supports large, medium and small organizations.
|For large organizations||With a legacy hosted application, when an organization outgrows it, it must consider implementing another solution. This is costly and disruptive.|
Data drives the process. continuous innovation.
The process drives the data.
|The business process rules are determined during the implementation, and process optimization is neglected. In a data-driven process, AI will detect anomalies in the data. Highly data-driven organizations are three times more likely to report significant improvements in decision-making.|
|One data model
Data dictionary is designed around modern business processes.
|Many data models
Data dictionaries are designed around 1990s business.
|Conflicting or wrong data as a result of inconsistencies in reporting and analysis with multiple data models leads to inferior and slower decision making.|
Learn why more companies are choosing Oracle over SAP
1 Q4 FY21 earnings call: https://investor.oracle.com/home/default.aspx