Oracle E-Business Suite – Should I Stay, or Should I Go?

By Yuval Gal • June 4, 2019

Table of Content

What is Oracle EBS?

If your head is also spinning with all the mixed messages around Oracle E-Business Suite and the Oracle cloud, you’re not alone. This blog post is an attempt at clearing the confusion.

Let’s start with the basics. Oracle EBS is an integrated suite of business applications for automating customer relationship management (CRM), enterprise resource planning (ERP), and supply chain management (SCM) processes within organizations. With this, businesses can manage various areas of their operations, including:

Financials
Human Resources
Manufacturing
Supply Chain
Projects
Customer Relationship Management (CRM)
Procurement
Advanced Planning & Scheduling
Business Intelligence

A common conversation among Oracle power users and IT decision makers is the best way to gain greater value from their Oracle investments.

While the Premier Support for Oracle EBS 12.2 was originally scheduled to the announcement that there will be no release of 12.3 has caused Oracle to extend support for 12.2 through at least 2033. IT organizations at enterprises that are heavily invested in EBS received this message with a collective sigh of relief. Nevertheless, they must keep their upgrades current.

Oracle Cloud or On-Premise What should you choose

IT leadership in enterprises running Oracle must keep an open mind. This announcement provides only the assurance that a migration to the cloud could happen on their own timeframe, and even in a phased approach. It DOES NOT provide a clear guideline on the urgency of moving to the Oracle cloud suite.

Mixed Messages

It is no secret that Oracle has been maintaining a strategy of mixed messages with regards to its cloud suite adoption. On one hand, it is working hard on delivering value to loyal customers wishing to keep their on-prem ESB current. This strategy currently pays off, with 65% of Oracle’s revenue derived from maintenance payments from on-prem solutions.

Should You Stay, or Should You Go?

So, Oracle is pushing towards the cloud, but is the market biting? Well, not so fast, apparently. Here are some proof points according to recent surveys:

~69% of Oracle EBS customers are still on 12.2.x, which is a considerable increase, up from 51% the previous year.
74% of customers who have been on EBS 10-15 years use EBS 12.2.x.
There is a new Oracle EBS version in the market: v12.2.12 and Oracle has since announced a 12.2.13 version to be released.
65% of survey respondents say their instance of Oracle EBS is hosted on-premises
Oracle patches are still being released quite frequently

Pros and cons of Oracle EBS on-premise

With Oracle’s recommendation to remain with the on-premise EBS, let’s look at some of the advantages and disadvantages to consider when making this decision.

Advantages:

Data Control: On-premise infrastructures give businesses 100% control over their data. This is a significant advantage in industries where there are strict regulations surrounding compliance.
Customization: Organizations can tailor their IT environments according to their specifications by;
- Modifying source code
- Adding custom features
- Integrating with third-party applications

Disadvantages:

Cost: Creating on-premises infrastructure requires considerable funds to begin with. This includes hardware, software licenses, not to mention an experienced IT team to handle the work.
Maintenance and Updates: On-premise ERPs need strict maintenance as they involve dealing with networks, hardware, security, software, as well as an range of support issues. This requires a highly professional IT team. In addition, they occasionally will need to be upgraded, which can disturb organizations’ daily business operations.
Scalability: On-premises infrastructures can be difficult to scale. It can also be time-consuming, and expensive for organizations to manage.

Now what are the advantages of Cloud Migration?

In a few simple words: speed, reduction in costs & scalability. But let’s look at this more closely.

Decrease in costs

Many organizations turn to cloud services for the simple reason that it costs less than an on-premises data center. Rather than dealing with extensive up-front costs, cloud customers merely pay for IT as an operating expense. Organizations therefore need to have fewer IT employees dealing primarily with maintenance as there is no need to run the data center, maintain hardware, and upgrade software.

Adaptability

Cloud infrastructure equips businesses with the nimbleness to swiftly adapt to emerging opportunities and challenges, capitalizing on technological advancements. IT units can integrate new cloud tools more rapidly as there’s no need to set up data center hardware or install software.

Once operational on cloud platforms, users continuously receive updated features without the need for manual software upgrades. With the elimination of purchasing and setting up hardware, databases, and containers, initiating new development tasks in AppDev frameworks becomes a matter of mere minutes.

Flexibility

Cloud solutions empower organizations to scale their computational capabilities up or down based on evolving requirements. For instance, during the initial phase of the COVID-19 pandemic, the global pivot towards blended and remote working led to a sudden dependence on video conferencing. Platforms like Zoom utilized cloud resources to augment their capacities to cater to this unprecedented demand.

On a larger scale, cloud providers facilitate numerous businesses in swiftly amplifying resources during high online sales periods and reducing them during lulls, optimizing operational expenses. Achieving such instantaneous resource modulation would be unfeasible with an in-house data center.

What next?

You might ask, ‘what practical steps should I take today?’ Well, Oracle recommends keeping the on-premise EBS current on your journey to a hybrid cloud approach. In the interim, leveraging technologies that can help you standardize, automate and accelerate the overall change process will help you change faster and with confidence. This White Paper provides expert advice on coexistence in a hybrid reality of Oracle on-premise and cloud applications.

Frequently Asked Questions

What factors should organizations consider when deciding whether to continue using Oracle EBS on-premise or migrate to the cloud?

Organizations should consider several factors including cost considerations, such as upfront investments versus subscription-based pricing, as well as scalability, flexibility, and agility offered by cloud solutions. Additionally, organizations should evaluate their IT infrastructure, security requirements, regulatory compliance, and business continuity needs to determine the best deployment option aligned with their strategic goals and objectives.

What are the key advantages and disadvantages of sticking with Oracle EBS on-premise?

Sticking with Oracle EBS on-premise offers advantages such as full control over infrastructure, data security, and customization options. However, it involves significant upfront investments, ongoing maintenance costs, and limited scalability compared to cloud solutions. Additionally, on-premise deployments may require more resources for IT management and lack the agility and flexibility offered by cloud-based solutions.

What steps should organizations take to assess their readiness for cloud migration and evaluate the potential benefits and challenges?

Assess current IT infrastructure, applications, and processes. Evaluate factors like data security, regulatory compliance, and technology stack. Consider benefits like cost savings and scalability, as well as challenges such as integration complexities and data privacy concerns. Engage stakeholders, conduct pilot projects, and seek guidance from experts to develop a strategic migration plan.

Start changing with confidence