“Get all of the benefits and eliminate the headaches by outsourcing Oracle apps” is the compelling argument made by many hosting companies and ASPs.
It’s an enticing proposition to trade the headache of managing DBAs, hardware administrators, etc. and replacing it with a fixed monthly charge. Why have the corresponding overhead when your assets can be focused on projects that improve competitive position and profitability? Let the experts manage the effort – they do it for hundreds of other clients so they can quickly and efficiently resolve any problem which may arise.
If the benefits are so great, why don’t all companies adopt this outsourcing strategy? There are many reasons why companies are less than enthusiastic about having their Oracle Apps hosted: concerns about data security, fear of longevity of the providers, doubt that another firm could understand their business and customizations, and all of the other issues related to outsourcing.
Having implemented several projects where a hosting strategy was used by the client, typically large well known hosting firms, and briefly contracting with a hosting firm, there are some factors that lead to a successful hosting relationship.
Quality service is at the top of the list. There is no substitute for timely response by knowledgeable practitioners. This is particularly true during the implementation phase where minutes can become precious. It is also true for system down problems after go live. The voice at the other end of the line needs to be able to command a team of people to quickly diagnose and take the needed actions to correct problems.
At this point, the perception of the value of the hosting company will be made. Typically it won’t be based on facts like response time and time to close issues. Or even better, a comparison to the actual resolution time to that specified in the agreement. Instead, it will be based on a comparison of the in-house staff that used to support Oracle Apps who typically knew the business and system configuration very well.
In many cases, the hosting company is labeled with a reputation of not being knowledgeable or responsive enough after comparison to in-house staff. It is hard for many people to be objective when they compare the new way of doing things to the old. There are many facets involved with arriving at this conclusion including the emotional ties to the team members that may have been made redundant.
Other factors must be considered too when evaluating a hosting firm. Some of these include the design of the hardware architecture, breadth of services offered by the hosting company, quality of the network, strength of the service level commitment, reputation with current customer base, overall cost benefit, etc., It is not a simple decision to make.
Is having your Oracle apps hosted a smart strategy? It depends. Does the hosting firm offer the services that are needed? Is the team available technically strong enough and abundant enough to resolve tough problems in a timely manner? Does the overall level of service provided meet the expectations as they are written in the agreement? Are the constraints to customizations acceptable? Does it make financial sense? Can you live with the perception of lower quality of service?
Each company needs to answer these questions honestly and weigh the importance of each question appropriately when determining if Oracle apps should be hosted and who the vendor will be.
How would you rate your experience implementing Oracle apps in a hosted environment? Please share your insights into the pros, cons and helpful tips that you may have.
Men occasionally stumble over the truth, but most of them pick themselves up and hurry off as if nothing ever happened. - Sir Winston Churchill