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Douglas Hughes, VP, Applications Product Development, Oracle, JAPAC, is upbeat about Oracles cloud vision announced recently at Oracle Open World. In conversation with N Geetha, Hughes brings to light the initiatives taken around its Fusion middleware to make it cloud enabled.
Can you elaborate on Oracles application road map for the future?
Oracle is invading its cloud mission enabling all its enterprise technologies and business applications through internet. As a process, the company has announced various platform services, application services, social platform, and mobility services. Besides, the product development team has ensured building these on smart platforms such as SQL, Java, HTML5, SoA, while creating user interfaces with strong web applications.
We are also assuring our customers and partners that we have created a robust support system through self-service models and also created support communities to support them.
Which of the cloud service models do you think is gaining momentum from the application outsourcing perspective at this point of time?
It is interesting to note that SaaS as a model is taking the right direction and most parts of the world are absorbing this service area. Now, I see customers being comfortable about putting CRM around the SaaS model. The reason for this is that it is logical, because one of the biggest problems in the business today have been surges in demand by the business and users. There have been massive demands in the HR segment where the customer behavioural pattern often changes, and it is easy to put such applications on cloud for its dynamic feature. With changing market dynamics, most customers find cloud to be a viable model to put customer facing applications on SaaS. HR applications on cloud are seeing a major boost. The next one we are starting to hear a lot of noise around is procurement and financials. Procurements had been there for a while, financials is the next wave.
Can you elaborate on how you intend to take the Fusion suite forward as part of the cloud strategy?
What we have done with fusion with our next generation applications is to make sure that every module within Fusion can be deployed on the cloud on the same code line. For example, if one of the manufacturing modules is able to go with the cloud, other modules too would have the same code line and to enable this functionality, we had to rewrite to build Fusion.
The reason for this is that there are many options out there. Cloud is always there, but the moment you mean to do something more, you need to customise, and you need to change and you need a different code line and thats a major downfall for a lot of companies and a lot of them dont even understand that.
How do you see Fusion and cloud from the Indian customer perspective?
We have built a capability that allows us to go on to the cloud or come off the cloud. From the Indian perspective, what I see is that there are many companies which are emerging, and I am always amazed when I interact with these. There are ambitious growth plans around these small and medium businesses which is indeed a reality. It is interesting to see the sheer growth scale in India and China, which is phenomenal. I found customers asking the most pertinent questions; for instance, they would ask, If I am going to scale to that, I want to make sure about putting infrastructure in correctly for my IT system, I would not like to start off with an off-the-shelf package that runs on a disk. I want what the top end of the town is using. I want to get enterprise software, now how can I do it? Since these customers would not want a big infrastructure cost, SAAS suits that. While it is an easy way to get up and running fast in a cost effective manner without having all the overheads, later if need be, they may want to bring it on purpose and that becomes interesting, so thats one of the key things.
It could be a reverse trend in places like India and China.
Where do you see the challenges for cloud in large enterprises?
Yeah, the interesting observation with regard to the large enterprises are that we are seeing pockets of areas with the same logic, so customers want to look at SaaS as a service because they see it as a cost saver. In reality, what happens is that if you think of it in terms of on premise,there is a high upfront cost and then it gets lower afterwards. If I look at it as a service lower upfront cost, there is a long ongoing cost. However, we are positioning our services as a cost saving measure.
I see bigger companies have got their own premise solution and they are allowing a surge capability on the demand solutions with service solutions. For instance, a big telecom company in India might have a 1,000 seats of CRM but it will take 200 -300 or 400 seats as SaaS, so it still has its very solid core with which it can do its service chores and sites chores and all its cross area chores and that tends to be tough as a service system to do. But when it is just pure marketing or any other functionality, it can do that but as a service, it is now allowed to blend its models. There is a hybrid model that will evolve. It already has an investment in it and it cant throw that away. However, what is going to happen is that as time goes on, companies will get to an inflection point, when they say, I have got to update my hardware. So the question would be, do I want to update my hardware, do I buy a hardware to put a software on it or do I want to own the hardware because I want to install the software or could I just buy a software and just have it? So those are the decisions that might be made. And I think it will be about using what the top end of town uses. Again, when I say SaaS I talked to a lot of C-levels around the world - and there is no logical checkbox to go with as a service.
Do you have any India-specific strategy for this? How will the IT heads buy in the line of business?
It is interesting to watch that many IT heads are putting across their core ideas to board members and say it would make sense if a particular task was done this way. The key change is that the C-levels have the discussion nowadays and they can choose which way they want to go and then some of them will be heard and some of them will go ahead.
However, there are a couple of things that the CIOs can think of. So, we all start with a PaaS, and if I look at the platform as a service - and it is not necessarily India-specific - I do see it as a smart direction for India. A lot of times, we want to turn around and we want to try something; say,we are in a big end of town and we might be in one of the big banks in India, you know, ICICI or any of those that are out there. Now in the past, what they had to do was a question of hardware. Get software, get everything up and running into a runner proof concept. I see a lot of C-Levels now saying, it would have been nice to just link that. I mean if it works, this is where we see the platform, I see the platform and infrastructure service setting up our IT department to deliver services to their customers to make them more not just cost effective but quick in the market. We know that the history has always been that the IT department has been slow, they havent delivered on budget, they havent delivered on time, and this allows levels of flexibility. The interesting thing that is happening right now, which is a great thing about software as a service is it is OPEX not CAPEX, and the bad thing about software as a service it is OPEX not CAPEX.
Where do you see the direction for Indian customers from Oracles cloud standpoint?
I see customers demand more references and proven models around Fusion. They want to see more and more customers allowing the operations on the product. They want to ensure that this continued innovation goes on and it is more about mobility. So, we have done a lot of announcements about mobility this week - mobility is very hot, social, it is not there yet but it is starting to tick in the peoples minds, and I think they also want to see if the directions taken around architectural framework makes sense. However, more and more people need to start to understand those foundations that have built up this structure and how to put that together.
Customers dont need to do away with the existing model or platform, only a part of it, and thats what we are doing. We know companies cant do that. There will be points in time when logical decisions will come and they can go, I will get rid of everything, all infrastructure that is there. But there are others thinking that I cant throw it out - I want them to focus on the big things and that is to make money. I dont want them to just throw it off, I want them to get up to the solution of the software, be it the older software or the existing products, so they are on a platform to be ready for Fusion. Thats a big one and India is pretty good at that. But getting on the lightest version is important for the key functionalities and then getting ready to deploy new products to extend their functionality, extend their capabilities. I call it extension because thats what we are doing. You are applying IT functionality into areas that are currently not applied and there is value there. Some questions that can be asked are: Whats my return on investments on upgrading my financials? I dont know. Whats my return on investment on the talent management system? If I can save three people, I have already started to see a lot of money coming in.
At this point, getting customers to Fusion is a slow process and we just have 100 customers. Rewriting Fusion was a big job. We didnt think when we started that we would have to rewrite from scratch and how big this would be. This is the first rewrite of enterprise software in 25 years by anyone.
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