November 13, 2019 | Kurt Moydell | Senior Vice President, Global Sales & Marketing
Last week at the Gartner IT Symposium/Xpo™ in Barcelona, Spain, I spoke to attendees on a topic that has caused no end of anxiety for many of our customers: how to know when – or even if – a cloud migration is best for their IT strategy.
Many Oracle and SAP customers facing end-of maintenance deadlines (especially for 2025 with SAP) tell us that they feel pressured to rush their on-premise applications to the cloud. In my session, I addressed this concern by explaining what we see as viable options and sharing three real-world examples from our customers.
Four Primary Approaches to Cloud Migration
After countless conversations over the past few years, we have categorized four approaches we see companies adopting in regard to cloud migration (shown below).
When discussing Oracle or SAP enterprise applications, these companies fall into two silos – those with no immediate plan for ERP cloud, and those that do have a plan. Within each silo, there are two states of thinking. Shawn du Plessis, the leader of our global SAP operations, covers these specifically for SAP in his most recent video.
In general, Spinnaker Support customers fall into category 2, above, which we refer to as “Optimize & Innovate.” With no immediate plans for the ERP Cloud, these enterprises have ignored arbitrary dates and vendor lock-in and chosen instead to optimize IT operations by moving to a third-party support vendor.
The obvious upside is realizing significant IT cost savings that can be invested in innovation on whatever schedule and terms work best for the company, not the software vendor. At the same time, these enterprises receive more responsive and comprehensive support from third-party vendors whose defining business model is to provide software support.
An Example of the Optimize & Innovate Approach
In my Gartner talk, I presented three examples of enterprises that have benefitted from the Optimize & Innovate approach. One of these was a global supplier of equipment solutions to the oil, gas, power, and petrochemical industries. Let’s call it Global Power.
Global Power needed to free up and redirect financial and human capital within its internal Oracle team to fuel its strategic initiatives – primarily the adoption of SAP on-premise and cloud solutions. While they focused forward on their SAP migration, the enterprise still required 100% uptime and support for its global Oracle applications, Fusion Middleware, and Database landscape, including global support for tax and regulatory reporting needs.
The solution was to bring in Spinnaker Support, a third-party support provider with:
- Named teams of E-Business Suite (EBS), Middleware and Database experts assigned to and aligned with Global Power’s support centers in the US, India, and France
- A global tax and regulatory team continuously monitoring, reporting and implementing tax and regulatory updates in the EBS systems across the globe
- Service fees that aligned with system use that saved Global Power more than 60% on its previous Oracle support spend
- Flexible commercial terms that realign fees during the contract period as countries and Oracle product suites are migrated and retired
The result? A company highly satisfied with its new Oracle support experience. Their internal IT resources are freed from supporting the Oracle landscape to focus on strategic initiatives (optimize), and the seven-figure savings on Oracle support fees have been redirected to drive the adoption of SAP on-premise and cloud solutions (innovate).
When Do Enterprises Fit this Approach?
Following the presentation, I was asked to describe how an organization would know it was a good fit for this approach. In my experience, leading indicators include:
- No immediate plan to migrate your enterprise applications to the cloud
- A need to optimize your existing applications and staff to better support the business
- A serious backlog of support tickets and grumbling from the IT staff over what isn’t being – or won’t ever be – covered by software vendor support
- You look at the high price of software support and wish you could recapture some of those annual costs for other, more important IT initiatives
Spinnaker Support is dedicated to the improvement of our customers’ Oracle and SAP support experience. If you’d like to learn more about our services and example customers, reach out and contact us today.