The idea of migrating your ERP system to the cloud promises scalability, enhanced security, and cost efficiencies. However, data from Traust’s 2024 ERP Survey emphasizes that cloud migration isn’t a one-size-fits-all solution. A majority of respondents (57.3%) viewed cloud migration as important but only one part of their overall strategy, while 21.6% considered it a “critical” priority. This suggests that many companies, particularly those using Oracle EBS, are approaching cloud migration with caution.
Potential Benefits of Cloud Migration
- Scalability and Flexibility: More than half (54.1%) of respondents highlighted the ability to scale resources up or down as a key driver for cloud adoption. For growing enterprises, this flexibility offers a distinct advantage.
- Security Enhancements: While moving to the cloud introduces new risks, 59.5% of respondents see the cloud as an opportunity to improve data security and compliance.
- Operational Resilience: Cloud solutions improve disaster recovery, with 34.6% of companies citing better recovery capabilities as a major benefit.
These advantages can be compelling, but they don’t mean every Oracle EBS user needs to migrate. Some organizations may find that the costs and complexities of cloud adoption outweigh the benefits.
The Challenges of Cloud Migration for Oracle EBS Users
Migrating Oracle EBS to the cloud brings its own set of hurdles that must be carefully managed. Nearly 47% of survey respondents reported difficulties integrating cloud platforms with their existing infrastructure. This challenge is particularly relevant for Oracle EBS users who rely on complex, highly customized systems. Cost management also emerged as a major concern, with 46.5% citing budget constraints as a significant obstacle.
Additionally, 63% of companies that consider cloud migration a critical part of their strategy reported data security and privacy concerns. For highly regulated industries such as manufacturing or healthcare, ensuring compliance within cloud environments can introduce complexity.
The key takeaway here: not every EBS environment is ready — or suited — for cloud migration. IT leaders must carefully evaluate whether the promised benefits justify the operational and financial risks involved.
Application Modernization: Targeted Improvements vs. Overhaul
For many organizations, modernizing existing ERP systems provides a viable alternative to cloud migration. Rather than uprooting everything for a cloud solution, 48.7% of survey respondents are opting for targeted modernization — focusing on specific applications that deliver the most value without disrupting business operations.
Why Choose Application Modernization?
Modernizing Oracle EBS enables companies to extend the life of their systems while addressing current pain points. According to the survey, 52.4% of respondents pursue modernization primarily to reduce high maintenance and support costs. Additionally, 46.5% cited better integration with newer applications as a key driver. By modernizing incrementally, many companies can mitigate risks while improving performance, usability, and efficiency.
However, extensive modernization isn’t always necessary. In the survey, large enterprises — those with revenues exceeding $5 billion — were more likely to take a cautious approach, preferring to evaluate modernization potential rather than committing to it outright. This underscores the importance of aligning modernization initiatives with business priorities and available resources.
Balancing Risks and Rewards in Modernization Projects
Modernization brings its own set of challenges. Nearly 43.8% of respondents worry that modernization efforts could disrupt day-to-day operations. For Oracle EBS users, whose systems handle critical business functions, such disruptions could have serious consequences. Budget constraints also remain a significant barrier, with 38.9% citing limited financial resources as a challenge for modernization initiatives.
Given these risks, IT leaders should consider phased modernization strategies that minimize disruptions while delivering incremental value. For example, modernizing user interfaces or automating workflows can improve usability without requiring a complete system overhaul.
To that end, Oracle APEX is a great tool for building EBS extensions with modern UI and workflow automations. Moreover, The new Oracle EBS 12.2.14 offers improved ERP functionality, tighter APEX integration, and enhanced customization tools.
Key Considerations for IT Leaders Running Oracle EBS
Ultimately, the decision to migrate to the cloud or modernize existing systems depends on several factors, including business goals, budget constraints, and technical readiness. Based on the survey findings, here are some practical considerations to help IT leaders navigate their options:
- Assess Business Needs Before Migrating: If scalability, disaster recovery, or security improvements are not pressing concerns, a full cloud migration may not be necessary. Instead, focus on targeted improvements that enhance existing operations without adding unnecessary complexity.
- Balance Cost and Value in Modernization Efforts: While modernization can reduce long-term maintenance costs, it also requires upfront investment. Where practical, phased modernization — such as upgrading critical applications first — can spread costs over time while minimizing operational risks.
- Use External Expertise Strategically: Many companies, particularly those using Oracle EBS, are turning to IT consultants and staff augmentation services to bridge skill gaps and manage complex projects. Survey data shows that outsourcing database administration roles is a particularly popular strategy among EBS users.
- Prioritize Cross-Functional Collaboration: Aligning cloud or modernization initiatives with broader business goals ensures buy-in across all management levels. Survey respondents emphasized the importance of cross-departmental collaboration to successfully execute IT projects.
Is Cloud Migration Right for You?
Cloud migration is not a mandatory step for every organization running Oracle EBS. As the survey data highlights, many companies are still evaluating their options, preferring to focus on incremental modernization that aligns with their business goals. IT leaders should approach cloud migration and modernization with a healthy dose of pragmatism, carefully weighing the benefits against the risks.
For some, targeted modernization will deliver the most value with the least disruption. For others, cloud migration may offer strategic advantages that justify the challenges involved. Ultimately, the best path forward is the one that fits your organization’s unique needs and long-term goals.
By making informed decisions based on the experiences of industry peers, Oracle EBS users can find the right balance between innovation and stability — whether through modernization, cloud adoption, or a hybrid approach that leverages the best of both worlds.
Not sure if cloud migration is the right move for your ERP system? Traust’s Oracle EBS consulting experts can help you evaluate your options and design a modernization strategy that fits your business. Reach out today to explore how we can support your ERP journey — whether that’s in the cloud, on-premises, or somewhere in between.
For more insights, download the full 2024 ERP Survey Report and see how industry leaders are approaching cloud migration and application modernization.
The post Not Every ERP Belongs in the Cloud: Evaluating Oracle EBS Paths Forward appeared first on Traust.