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Enterprising Insights, Episode 23 – Oracle Analyst Summit, Industry News, and a CX Rant

Enterprising Insights, Episode 23 - Oracle Analyst Summit, Industry News, and a CX Rant

In this episode of Enterprising Insights, The Futurum Group’s Enterprise Applications Research Director Keith Kirkpatrick discusses the Oracle Analyst Summit, a survey on the changing nature of service organizations from Salesforce, and brief commentary on the plethora of earnings announcements from SaaS vendors. He then closes out the show with the Rant or Rave segment, where he picks one item in the market, and either champions or criticizes it.

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Listen to the audio below:

Disclaimer: The Enterprising Insights podcast is for information and entertainment purposes only. Over the course of this podcast, we may talk about companies that are publicly traded and we may even reference that fact and their equity share price, but please do not take anything that we say as a recommendation about what you should do with your investment dollars. We are not investment advisors and we do not ask that you treat us as such.

Transcript:

Keith Kirkpatrick: Hello everybody. I’m Keith Kirkpatrick, Research Director with The Futurum Group, and I’d like to welcome you to Enterprising Insights. It’s our weekly podcast that explores the latest developments in the enterprise software market and the technologies that underpin these platforms, applications and tools. This week I’d like to recap the Oracle applications and Industry Analyst Summit, which I attended in Redwood Shores, California, a couple of weeks ago. Now, this event really highlighted Oracle’s approach to its Fusion apps and how it’s embedding AI to improve efficiency, productivity, and accuracy. Then I’m going to go through a few news items from the past week or so, and of course, close out the show with my rant or rave segment where I either champion or chastise something from the enterprise applications, CX, EX or collaboration market. Let’s get right into it.

As I mentioned, I spent some time at Oracle’s Industry Analyst Summit. They talked about a number of different things, but I want to focus in on the items that really resonated with me. There’s a couple of things, first, if we talk about Oracle and AI, let’s first talk about why do they have a compelling vision. Well, first of all, they are uniquely positioned in that they own the entire technology stack. Everything from the cloud infrastructure to the AI models to the applications, all of that they actually make available to their customers. Now, honestly, not all customers are going to use everything from Oracle and only Oracle, but what this does mean is that because Oracle doesn’t have all of this available, they are able to better control the implementation, they’re able to manage cost quite a bit more. And of course, the most important thing is the way that they handle applications, particularly their Fusion applications, is that they only have one version of the software that is out there at any one time.

So all of their customers get all of the upgrades at the same time, they’re all running on the same build. Why is that important? Well, the first thing is that you don’t have a situation where perhaps one division or one segment of the company is using one version versus another, and you run into issues there with various APIs breaking and what have you. So it’s very stable and it’s very consistent, it’s very consistent experience. That alone is really important, particularly if you are doing a lot of moving of data in between applications or you’re trying to implement artificial intelligence across these different platforms and different applications. So in that instance, it is a really great approach to using AI because you have such a stable and robust platform. Now, one of the other things that they talked about here, which is really interesting, is their work around artificial intelligence and the different use cases that they’ve been building out.

Now, they claim that over the past year, year and a half, they’ve developed about 50 use cases that are now available to all of their customers because again, it’s basically one build is out there. They are really trying to take the approach that generative AI should not be this bolted on capability that’s productized separately. They really want push the vision of generative AI is just another technology that is embedded within the application. It’s available to everybody, and in most cases, they will not be charging anything extra to use that generative AI. That is in contrast to some other vendors out there that are saying, okay, if you have a seat license, if you want generative AI, you need to pay an extra 25, 30, 50, whatever extra amount a month to use that technology. Now, the reason again, that Oracle can do this is because they own these entire stack, they have a much tighter control over the cost of deploying generative AI. So in that sense, they have a real advantage in the marketplace and that they can deliver this functionality and then obviously maintain their cost structure and then pass that along to their end users.

Now, I wanted to also talk about a couple of different capabilities here that they’re talking about. Obviously, like a lot of companies, they’re talking about using generative AI to assist the generation of answers by using generative AI to mine the company data to surface insights and answers to prompts or queries. That’s not necessarily a unique capability, but what is pretty interesting is that because, again, if you think of Oracle and just their size and scale, they have a ton of data. They have a long history of working within very specific industries, so they understand the various use cases, the various scenarios that might come up, and then as a result, they’re able to tune those models to basically learn those different processes, which in response really helps them tune and provide a much more accurate response. And there are talked about some other use cases that are pretty interesting, obviously talking about opportunity qualification scoring. Again, you’re basically trying to identify the right buying group, looking at the different factors that are incurring during the deal, and then you’re able to really assess is this a good lead?

Is this this not a good lead? Assisted authoring for marketing sales, that would be like targeted sales outreach or marketing outreach using customer data, using data where we’re looking at, where they are along in the buying process, what are the triggers that would hopefully entice a customer to buy. And these can include things like copy for emails or landing pages, that sort of thing. And then of course, one of the other new use cases is looking at seller engagement recommendations. This is basically providing targeted recommendations on specific products based on, who is the seller, who is the buyer, what are the trigger points there, and how can they be brought together in such a way that then you can develop content where you highlight that and then pass that along to help sellers really engage with their customers in a more targeted and personalized way. So certainly really interesting. The only other thing I really want to talk about with respect to the AI, is that one of the great things that I heard at the event is that Oracle realizes that the power of generative AI is actually not even with the AI necessarily, it’s really about having a solid data management, data governance strategy.

Making sure that the data you have is properly labeled, properly segmented in a way where once you have these algorithms, you’re able to actually apply that information or apply that LLM to that data and have that return something useful. And this also comes down to making sure that it’s accessible. If you have data that’s sitting in a number of different silos across the organization, it can’t be used, there’s not a one single source of truth, it doesn’t matter how great the model is, it’s not going to return anything. So I think that’s going to be certainly something that we hear much more about from not only Oracle but from other vendors as well. If there’s one thing that I would like to have heard a little more about, it’s instead of just talking about capabilities, I would love to hear more about outcomes. Now, I understand that a lot of this stuff is still in pilot, a lot of this stuff is still pretty new, but I would love to hear more about what are some of the expected outcomes from being able to use generative AI in terms of whether it’s expected metrics, specific ROI figures, that sort of thing. I think that’s the stuff that’s really going to move the needle for many customers because any technology, it’s great to hear about, “Oh, what does it do? What are the features there?” But ultimately they want to know how is this going to impact my business in terms of the big picture, top line growth, bottom line growth, all of that kind of stuff.

So I think that Oracle, like a lot of other vendors needs to get away from just talking about the features and get into some more of the business benefits. And this can also extend to how they work with customers in terms of implementation, being able to say, “Look, this is something you can implement within 30 days or 60 days as opposed to two or three quarters.” Their time to value. Certainly a big consideration when we’re talking about new technology that is really moving very quickly. And then the other piece of news that really came out right before the conference was that, Larry Ellison announced that Oracle was going to move its headquarters again, this time from Austin to Nashville, Tennessee. And the reason for that is apparently Oracle is going to double down and really focus in on the healthcare industry. And essentially Nashville, it’s apparently headquarters to a number of large healthcare companies or systems. And I would assume that there’s other stuff going on there, I’m sure Nashville gave Oracle a very nice incentive package in order to move the headquarters there.

But I think it’s also interesting to see how Oracle is taking a very public approach to going after companies within a specific regulated industry. Why can they do that where others can’t? Well, again, it comes down to they have size and scale, they have lots of experience working with these types of companies. They have experience dealing with the various regulations that are involved, as well as the different types of processes and pieces of data that are common to that industry. So it’ll be interesting to see how this goes over the next months and years. But I think it’s an interesting approach, I think it was interesting that I talked to a few folks in Oracle who’ve seen the little caught off guard in terms of the move, but they Oracle moved from the Bay Area to Austin, four or five years ago? And they seem to be trucking along. And I think that’ll be the case here if they do make that move to Nashville.

Okay, so now I want to quickly move ahead and talk about a little bit of news from the past week. That was interesting. Salesforce actually released some news. They did a survey of about 5,500 service professionals across the world, about 30 countries or so to really try to understand how service organizations are adapting to rising consumer expectations. So when we’re talking about rising expectations it’s really about, we live in a instant gratification, immediate service world where you can get food at any time of day from pretty much anywhere you want through the delivery apps. Or if you want a product from Amazon, you don’t need to even wait overnight, it can be delivered to you in hours. So I think this is a really interesting survey. I’m just going to go through a couple of quick highlights here that I found interesting. According to the survey, about 79% of these organizations invest in AI and 81% use workflow or process automation. This is really interesting to me. And this is not just generative AI, I’m sure this is also just predictive or analytics-based AI. I think this is interesting because it’s clear that if we look at the market and look back 10 years ago where we were talking about AI, I certainly wrote reports 10 something, 10, 12, however many years ago where the level of adoption of AI was certainly nowhere near these levels.

So it’s clear that AI has become commonplace and is seen as a tool that is absolutely necessary in order to compete in today’s world. Now, the other interesting thing is that despite the fact that we are in an era of high inflation and certainly rising costs, the survey said that 83% of survey decision makers plan to increase their AI investments over the next year as well as increase their automation investments. So it is by no means done, there’s still a lot of work that is being going on in terms of trying to infuse AI across these different organizations to improve responsiveness, to improve predictability, and to ultimately improve the customer experience of those organizations’ customers. Now, another thing that’s really interesting is that 85% of those decision makers said that customer service organizations are now expected to contribute a larger slice of revenue through upselling, cross-selling and customer retention strategies over the coming year. So again, this is interesting because if you think about customer service in the past, it was really about just solving a particular problem as it came in. If you did that, the thought was, “Okay, well that was good enough. We hopefully satisfy the customer and we’ll move on.”

Now with the advent of all of this data that’s being incorporated, so things like more customer journey, information history, transaction history, personalization data, now the needle is shifting to taking these support organizations and starting to impose revenue generation responsibility onto them because they have all this data and they have the tools now or will be getting the tools to help them actually generate revenue instead of just being a cost center. So that was interesting, but not surprising. And along with that, there’s a stat here. It said the share of service organizations that are tracking revenue driven by service agents actually jumped from about 51% of organizations in 2018 to 91% in 2024. So this is going on across the industry, and it’s why when you’re on the phone with a support agent now, they’ll do that suggestive sell much in the way if you go to a fast food joint and they offer you, “Hey, would you like fries with that?” So we can expect that continue. And of course, this means that if you think about organizations and their labor force, 86% of the agents say that their expectations are higher than they used to be placed on them.

And the other part of that is 81% of those agents say that customers are expecting a more personal touch than they ever did in the past. So there’s a lot of pressure on agents and a lot of pressure on organizations to provide that upselling capability, but also that personal touch. And I think the reason this is all really important is, if you think about AI and generative AI in particular, there’s going to be a distinct need for technology that serves up this relevant information very, very quickly, but doing it in the appropriate time to maximize the chance of conversion from a support interaction to a sales interaction. So interesting to see how this shakes out over time because simply there are different skills. Providing support is a different skill than selling. And I think the missing piece in all this is what is the implication for organizations for either offloading some of the load to self-service? And also what is the responsibility of these organizations to implement training to help them use these tools to help them sell?

So with that, I would like to then quickly shift gears here and talk about the rant or rave I have for the week. And basically again, I have a rant, and this goes to an experience I had traveling to one of the many conferences I was at. I had booked a flight on an airline or someone booked the flight for me. And unfortunately it was not my normal carrier, and I could not get the boarding passes on the mobile app or on the website to work. I’ve tried several times, different ways, could not get a boarding pass. And then of course, I finally thought I had a boarding pass that I could print out. And being at the hotel early in the morning, four or five in the morning, I couldn’t print it out because our problem with the printer in the hotel Lobby. So I went to the airport thinking, “Great, I’ll just do it some at old-school and go get my boarding pass at the kiosk.” Only to find there are new kiosks available. So then I had to wait in line with everybody else to meet a gate agent. And of course, waited quite some time, got up to the front and asked the agent why could I not print it out or why could I not get it through the mobile app, which was promised, or I could not get it through a kiosk.

And I was told, well, apparently it’s a co-chair flight, and I was unable to complete that because of two systems couldn’t talk together to let me actually get my boarding pass on my phone. And that, I think from an enterprise application, customer experience lens is unacceptable these days. If you think about airlines are trying to remove as much cost as possible. If you can’t take care of that type of activity online, you’re really missing an opportunity to save costs because then you have to staff more agents to deal with the longer lines. And then the second part of it is the fact that there was no kiosks that I could print out my boarding pass at the airport is absolutely inexcusable these days. It’s not something that… Essentially, it’s almost a fixed cost once you buy that. It shouldn’t really be much cost at all. Forcing the agents to deal with me in line, it just doesn’t make any sense.

So that is definitely a rant this week. I’m not going to name the airline, but I bet you can guess who it is. But these points of friction can be eliminated through better integrations and a more robust application or platform to handle the ticketing to boarding pass process.So anyway, that is the rant and all the time I have for today. So I want to thank everyone for joining me here on Enterprising Insights. I will be back again next week with another episode focused on the happenings within the enterprise application market. So thanks again for tuning in and be sure to subscribe, rate and review this podcast on your preferred platform. Thanks, and we’ll see you next time.

Author Information

Keith has over 25 years of experience in research, marketing, and consulting-based fields.

He has authored in-depth reports and market forecast studies covering artificial intelligence, biometrics, data analytics, robotics, high performance computing, and quantum computing, with a specific focus on the use of these technologies within large enterprise organizations and SMBs. He has also established strong working relationships with the international technology vendor community and is a frequent speaker at industry conferences and events.

In his career as a financial and technology journalist he has written for national and trade publications, including BusinessWeek, CNBC.com, Investment Dealers’ Digest, The Red Herring, The Communications of the ACM, and Mobile Computing & Communications, among others.

He is a member of the Association of Independent Information Professionals (AIIP).

Keith holds dual Bachelor of Arts degrees in Magazine Journalism and Sociology from Syracuse University.

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