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Delivering Oracle Success
Cloud Computing for Finance
Deb Morton
“I’m a CFO, Why Do I Need to
Know About the Cloud”
April 5th, 2012
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About DBAK
Oracle Solution Provider and License Reseller
Core Technology and EBS Applications
Colorado Owned and Operated
Average 15 Years of Oracle Expertise
“Top 250 Private Companies, 2011” – CoBIZ Magazine
“Emerging Business of the Year, 2008” – South Metro Denver
Chamber of Commerce
100+ Clients
170+ Implementations, Upgrades, Conversions, Support Projects
Oracle Gold Partner
OEM “Specialized”
About Deb
20+ years in information technology
Brocade - Senior Director, IT
Exabyte - Director, Information Systems, Senior Business
Systems Manager, Business Systems Analyst
Project lifecycle expertise including leadership, analysis,
conceptual design, user training, implementation
BS in Business Administration
Oracle Applications Implementer of the Year, 2006
Continuing professional studies in Conflict Resolution,
Negotiation Skills, and Facilitative Leadership,
Graduate of the Women’s Vision Leadership Institute
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DBAK Clients
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Agenda
Cloud 101
Reasons to Consider
Questions to Ask
Customer Experience
“Cloud computing is still very much at the peak of the Gartner Hype
Cycle (and very much on the mind of CFOs).”
–Choosing a Cloud Application: A Hornet’s Nest of Complexity, CFO.com, March 2012
According to a survey conducted by CFO Magazine, nearly a third
of all CFOs admitted that they didn’t know much about cloud
computing, and weren’t even sure what the term meant. Yet, when
asked how cloud computing might affect their company’s approach
to IT, almost half believed that it would enable a significant
restructuring of their entire IT strategy.
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“CFOs have high hopes for cloud computing, even though they
don’t appear to know much about it.”
–Cloud Computing: Sounds Great! (But What Is It?), CFO Magazine, March 2011
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Cloud Layers
Platform
End User
Infrastructure
Applications
Cloud Computing 101
According to the National Institute of Standards (NIST), Cloud computing is a
model for enabling convenient, on-demand network access to a shared pool
of configurable computing resources that can be rapidly provisioned and
released with minimal management effort or service provider interaction.
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Table: NIST Definition of Cloud Computing
Essential Characteristics
On-demand self-service • Provision computing capabilities without human interaction
Resource Pooling • Multi-tenant model, resources assigned dynamically
• Location independence
Rapid elasticity • Scale rapidly ‘outward and inward’ commensurate with
demand
• Can appear unlimited
Measured service • Usage can be monitored, controlled and reported
• Transparent to both provider and consumer
Broad network access • Available over the network – thick or thin clients
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Deployment Modes
Software as a Service (SaaS)
• Applications are delivered as a service to end users,
typically over a web browser. There are hundreds of
SaaS service offerings available today, ranging from
horizontal enterprise applications to specialized
applications for specific industries, and also consumer
applications such as Web-based email.
• Multi-tenant as well as single-tenant options that can be
deployed over public, private, or hybrid clouds,
depending on an organization’s needs
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Deployment Modes
Platform as a Service (PaaS)
• Application development and deployment platform
delivered as a service to developers who use the
platform to build, deploy and manage SaaS
applications. The platform typically includes databases,
middleware and development tools, all delivered as a
service via the Internet.
Infrastructure as a Service (IaaS)
• Servers, storage, and networking hardware delivered
as a service. In this mode, infrastructure hardware is
often virtualized, so virtualization, management and
operating system software are also part of IaaS
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Service Models
Private Clouds
For exclusive use by a single organization and typically
controlled, managed and hosted in private data centers. The
hosting and operation of private clouds may also be outsourced
to a third party service provider. This type of service model is
well-suited to larger organizations that need to standardize their
processes and infrastructure, and desire the security, reliability,
and greater control delivered with a private cloud.
Public Clouds
For use by multiple organizations (tenants) on a shared basis
and hosted and managed by a third party service provider.
Public clouds work well for companies seeking to avoid upfront
capital costs and willing to forego customization of the
processes being outsourced.
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Service Models
Community Clouds • For use by a group of related organizations who wish to make use of
a common cloud computing environment. For example, a
community might consist of the different branches of the military, all
the universities in a given region, or all the suppliers to a large
manufacturer.
Hybrid Clouds • When a single organization adopts both private and public clouds for
a single application in order to take advantage of the benefits of
both. For example, in a “cloud bursting” scenario, an organization
might run the steady-state workload of an application on a private
cloud, but when a spike in workload occurs, such as at the end of
the financial quarter or during the holiday season, they can “burst
out” to use computing capacity from a public cloud, then return
those resources to the public pool when they are no longer needed.
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Putting It All Together Logical diagram
Cloud Computing Changes the Way
IT Impacts Business Delivering Agility and Faster Innovation with Lower Cost
Greater Agility Cost Effective More Innovation
Faster Deployment and Responsiveness to Changing
Business Requirements
Focus on Core Competencies, Differentiation and Innovation
Lower Costs, Greater Efficiency and Utilization
Innovation and Agility
Growing Factors For Cloud Adoption
Top Expected (Non-Cost Driver) Benefits from Cloud Business Solutions*
*Source: “Advancing Business Innovation in the Cloud”, Saugatuck Technology. June 2011
Enable Business Process Improvement
Speed Implementation
Increase Revenue
Speed Time to Market
Focus on Core Competencies
Reduce Risk
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Top Five Reasons 1. Reduce Capital Expenditures
With economic instability and reductions in capital expenditure (CAPEX)
budgets, CFOs are keen to trade owned IT costs for solutions that can
be logged as operating expenditures (OPEX). Booking a predictable,
periodic IT expense for guaranteed service levels is more appealing to
finance than writing a big check for a big IT implementation.
With cloud computing, instead of making a large up-front investment in
IT infrastructure, staff, and resources, customers rent computer
capacity, saving CAPEX budget for revenue-generating efforts.
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There’s tremendous benefit in relying on experts to manage IT
infrastructure. The lines of business reduce requests to the already-busy
IT department and avoid additional hiring, training, and management of
their own IT staff. Also, managers reduce their spending on tech
solutions—offerings like Oracle Cloud Services often proactively
address them. In the end, this means managers spend less time
working on IT and more time thinking about the business.
System administration, upgrades, and maintenance become the
responsibility of the cloud services supplier.
Top Five Reasons 2. Reduced IT Cost and Complexity
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Security and compliance are top priorities for companies looking to
invest in the cloud. Sensitive customer and business data must be
protected, and regulatory and reporting requirements must be rigorously
met. With the right solution, CFOs must have confidence that these are
top priorities for cloud services and technology providers.
“That is one of our highest priorities, both for our customers and our
company,” says Avenier. “Working with Oracle and being in the cloud
has made me, as CFO, a lot more comfortable with what I am
approving. I can trust the people I’m working with. Had we been using
our own infrastructure and database, I would have been spending a lot
more time reviewing security and compliance details.”
Top Five Reasons 3. Protect Data and Enable Compliance
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On-premises IT solutions can require valuable hours and investment for
hardware and software setup and maintenance—and changing the
environment can involve significant effort. When enterprise IT is
managed by a cloud service such as Oracle Cloud Services, it’s faster
to implement and easier to change. This helps companies go about
their business more quickly and reduces long-term costs.
Morpho Detection reduced system implementation time by 60 percent
with the help of Oracle’s managed cloud services, allowing managers to
quickly start bidding on major, time-sensitive U.S. government projects
representing hundreds of millions of dollars of revenue. “A technology
project that would have taken 18 months was completed in 4 to 5
months,” says Avenier.
Top Five Reasons 4. Deliver Innovation Quicker
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The right cloud services solution can offer CFOs in-depth technical
expertise, lower IT costs, faster business returns, and peace of mind.
But how does a CFO choose the right provider? Hutchinson says
executives should look for a vendor that has spent considerable energy
and resources in making its cloud solutions enterprise-ready.
“To be in the cloud services business in a real way takes a tremendous
amount of investment,” says Hutchinson. “The right provider is
constantly investing in the ability to support applications of enterprise-
level size and scale.”
Hutchinson says more customers are looking to support their
businesses as a whole—including their manufacturing, customer, and
financial systems—in the cloud.
Top Five Reasons 5. Support the Enterprise
Questions to Ask
What are you trying to accomplish with the cloud -- i.e., where are the optimal
workloads in your organization that would benefit the most from a cloud
infrastructure?
How viable is the cloud vendor – years in business, financial status, etc.
Do you have the option to move back to on premise if your needs or goals
change?
How flexible is the technology? Can business processes be customized or
personalized without IT involvement?
How successful has the vendor been at meeting SLAs?
Will the vendor provide data migration support?
Does the vendor have clear channels for communication regarding service and
performance issues?
If you have global operations, is the cloud vendor able to provide 24x7 access
and help desk support globally?
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© DBAK 2011
GL and AP Cloud Based Rapid Implementation Business Case
Why make the transition to enterprise (Oracle E-Business Suite):
Control costs
Manage risk
Automate and standardize accounting practices
Increase visibility for improved decision making
Position for faster growth
Modernize outdated or non-integrated legacy system
Gain efficiencies existing applications don’t provide
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Is This You? Typical Company Profile
Industry agnostic
Single location or multi-location global
Scaled to suit $10M - $500M revenue company
Outdated or inadequate Financials system
Looking for more efficient Financial tracking and
reporting
Looking to improve Total Cost of Ownership (TCO)
Limited budget
Looking to manage data across divisions including
merge and purge functionality for a growing company
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1
No change Ready for ERP
2 3 4 5 6 7 8 9 10
Does your current configuration meet your business requirements?
Do you wish to make changes to the current software and configuration?
Is your business structure changing significantly (more/fewer business
units/orgs, currencies, shared services)?
Is there a need to replace 3rd party applications with software that has new
features and functionality?
Meets requirements
Not much need
Current software and configuration are OK
Significant need
Structure is correct for our needs Our structure is
changing/needs to change
We require changes
A change is needed
Criteria For Deciding Whether
Or Not To Adopt Oracle Financials
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Key Milestones
VALIDATION CRP, Document, Update Configurations
USER ACCEPTANCE User Acceptance Testing, Knowledge Transfer
TRANSITION Production Readiness – System and People
GO-LIVE and SUPPORT First line of support
Sample Timeline
Week 1-2 Week 3-4 Week 5-6
CONFIGURATION Define Support Structure, Configure GL/AP,
Create Reports
DEFINITION Collect Requirements, Confirm Scope, Plan
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Questions
Our position on enabling customer choice in the cloud supports Gartner’s view that enterprises should evaluate the benefits of cloud computing across multiple dimensions - such as the level of control an enterprise needs over cloud services, to the type of architecture, access, and skills required to make cloud computing a success.
Gartner estimates that 90 percent of all SaaS deployments today are not pay for use. Like on-premise, organizations often end up paying for more seats than they actually need – in effect paying rent at the SaaS provider’s data center.13
The CIO Executive Board reports that a lower TCO of up to 20 percent over a three-year period can only be achieved with smaller SaaS deployments (less than 500 users) and highly standardized implementations. Scale, customization, and integration all erode the cost advantages of SaaS to less than 10 percent and in the third or fourth year of a SaaS implementation, costs could swing lower in favor of on premise software. 14
A January 2011 PricewaterhouseCoopers study on HR and payroll solutions found that there were no demonstrable TCO savings, on average, for companies with 1,000 employees or more using a SaaS model vs. an on-premise solution.1
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