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Over the years, IBM and Oracle have competed on several fronts. They’ve also nurtured a close alliance since the early 1980s (there was even a stint years ago when IBM developers worked directly out of Oracle’s Redwood Shores headquarters), setting the bar for ‘co-opetition’ even before the advent of hybrid cloud began uniting erstwhile competitors.
The relationship was born from a joint effort to optimize Oracle database on IBM hardware. More co-innovation in mutual products followed, prompting IBM’s consulting unit to begin reselling Oracle financial software.
Today, IBM is a leading Oracle services provider.
Rob Churchyard leads that global Oracle practice inside IBM. Over the last year, he’s been overseeing a transition in that practice—where his team traditionally focused on delivering business management solutions through Oracle’s suite of enterprise applications, it’s increasingly branching out across the IT stack with Oracle Cloud Infrastructure (OCI).
As the business evolves, its foundational principles remain consistent. The first is “always lead with industry,” Churchyard said.
“You really have to sit down and listen and think about what the client needs, why they are doing this, what they want, understand the business case, and oftentimes that comes back to some kind of industry need, some reason at a higher level in their business that they are investing millions of dollars into a transformation project, and that’s usually driven by big market forces led by industry change, disruption of some form.”
That approach positions IBM to tackle complex, multinational digital transformation projects that call for close cooperation with Oracle to deliver the clients’ desired business outcomes.
Here’s Churchyard’s take on how to seize an abundance of opportunity in the enterprise IT market with a global Oracle practice.
For decades, IBM’s relationship with Oracle focused on apps.
That began to change 2 years ago, when IBM launched an OCI practice upon recognizing the potential of Oracle’s next-generation cloud infrastructure to deliver value to enterprises as they migrate to the cloud.
Today, cloud infrastructure is a growing percentage of the overall Oracle business, Churchyard said, and IBM continues to team with Oracle to enable its capabilities for clients on their cloud journey.
“We see Oracle as a serious up-and-comer that is growing market share,” Churchyard said.
It might surprise some, but both companies being well-positioned with strong offerings in the rapidly growing cloud market doesn’t create any friction for his team. IBM and Oracle both recognize it’s a multi-cloud world, Churchyard said, and “different customers want different things.”
As a relative latecomer to the IaaS market, Oracle needed to articulate a unique value-proposition for its emerging cloud infrastructure. The story of “Oracle on Oracle”—running Oracle databases and apps on OCI—was a good one.
“Everything has been architected to run Oracle systems, Oracle apps, Oracle technology in the best possible way on its infrastructure,” Churchyard said.
That shouldn’t come as a surprise, as OCI underpins the versions of all those products Oracle delivers as Software-as-a-Service and Platform Services offerings.
Oracle then complemented the technological benefits of a unified stack with commercial ones.
Financial incentives like Bring Your Own License, and offering SLAs far superior to what competitors could for hosting Oracle apps, is attractive to clients from a performance and pricing perspective.
While the value of Oracle’s IaaS has progressed beyond this initial messaging, “Oracle on Oracle” is still a great place from which to launch an OCI practice, he said.
The appeal of OCI has broadened of late.
“We’re seeing clients talk a lot more about moving non-Oracle workloads onto Oracle Cloud Infrastructure,” Churchyard said.
Large organizations increasingly recognize the differentiated price-performance characteristics of Oracle’s next-generation cloud. And as more migrate large swaths of their application portfolios to OCI, their stories circulate in the marketplace, encouraging new converts.
Overall, enterprises feel trapped in a “legacy spaghetti junction of mess,” Churchyard said, and the impact of the Covid-19 pandemic on mission-critical supply chain platforms heightened those concerns. The story driving those types of customers to public cloud is flexibility, elasticity, better security, and lower TCO.
“All the messages Oracle wants customers to understand in that space are resonating, are making sense,” Churchyard said. And some headlining wins of late, from Zoom Communications to Tanium, nicely reinforce that message.
Add in the breakneck growth in Oracle’s global data region footprint, giving clients in almost every locality an option of running their mission-critical workloads close to home, and OCI becomes a uniquely attractive IaaS option, he said.
Helping clients implement a hybrid cloud strategy—through services and technology solutions—is critical to IBM’s ethos.
“At IBM, we’ve been talking multi-cloud, hybrid cloud, for a number of years now because our clients require a cloud architecture that allows them to operate seamlessly and securely across on premises, private cloud, public clouds—and all the way to the edge,” Churchyard said.
In 2019, IBM made a major bet when it acquired Red Hat and its Open Shift hybrid cloud platform, which allows companies to build an application once and run it on any cloud, and integrate data and applications across multiple computing environments, from any vendor.
Oracle has embraced a similar philosophy, one put in practice by a set of complementary infrastructure offerings that can meet almost every possibility for the modern enterprise.
Among them, OCI offers Azure Interconnect, a service to link up with Microsoft’s Azure cloud. Customers can also deploy Oracle Cloud completely within their own data centers with Dedicated Region and Exadata Cloud@Customer, or use Oracle Roving Edge for extending cloud services into the field.
“Whatever you need and however you need it, Oracle and IBM have an offering,” Churchyard said. “In the hybrid cloud market, that’s very important.”
Software-as-a-Service still constitutes the largest portion of IBM’s Oracle practice.
“Because we help businesses transform, our focus will continue to be Oracle Fusion Cloud Applications Suite,” Churchyard said. “
About half of IBM’s Oracle engagements at the application layer involve ERP solutions (including supply chain), mostly delivered through Oracle Fusion Cloud Enterprise Resource Planning (ERP) and Oracle Fusion Cloud Supply Chain & Manufacturing (SCM). Oracle Fusion Cloud Human Resource Management (HCM) and Oracle Advertising and Customer Experience (CX) comprise the rest, Churchyard said.
IBM prides itself on an innovative approach to delivering Oracle software, melding its “cognitive enterprise” vision anchored on IBM Watson technology with Oracle’s entire product suite.
IBM has optimized and extended Oracle Cloud ERP and Oracle Cloud HCM applications, as well as OCI, with industry-specific capabilities incorporating its cutting-edge artificial intelligence and other emerging technologies like Internet-of-Things and blockchain, Churchyard said.
“We’ve identified 70 use cases, and then we’ve built out those use cases using machine learning and automation and integrated that back into Oracle Fusion Applications,” Churchyard said.
That effort is “at the heart of the Oracle business,” he said. “It shows we seek to differentiate ourselves.”
IBM’s Oracle business is extremely diverse across the global regions in which it operates. IBM has made “a conscious decision to focus on specific areas,” Churchyard said.
Many factors are considered when deciding the strategies to pursue in different regions: what sectors are likely to be early adopters, or have regulatory challenges, or just natural propensities to buy Oracle over competitors. Sometimes the decision comes down to something as simple as an existing customer win in a sector that IBM decides to replicate, he said.
The Oracle practice is particularly thriving in Japan, where IBM specialists are heavily focused on financial services and supply chain transformation, Churchyard said.
That success stems from what was a concerted effort about five years ago to go all-in on Oracle SaaS, even though the Japanese market “wasn’t entirely there yet.” IBM wanted to bring Oracle’s cloud-based application portfolio to Japanese enterprises, and the strategy proved to be fruitful.
“We worked really hard to make it successful and it paid off in that market,” Churchyard said.
In France, IBM has been busy deploying Oracle transportation management and distribution solutions.
“It’s very different by country, market, and sector,” Churchyard said.
For more information of IBM's Oracle Services, please visit: https://www.ibm.com/services/oracle