Cloud Tech to Boost SME Empowerment

Q: What challenges has Oracle faced in Mexico?

A: Overall, Latin America represents 12-13 percent of our operations and Mexico accounts for roughly 30 percent of that. Our biggest challenge was our shift from product sales to service provider. Previously, companies would ship out unfinished products and customers had the responsibility of finishing those products. This was a challenge for customers as it detracted attention from their core business, which was to finish the information system. By moving to the cloud customers can concentrate on their core business and Oracle provides end-to-end services.

Instead of being product driven, we need to be service driven, which changes the way we behave. We need to concentrate on making customers happy on an hourly basis. The biggest challenge we are facing is our ability to attract talent with these new characteristics. The cloud is becoming popular because there are other complementary technologies. Mobility, the Internet of Things, Big Data and the cloud are the four main drivers that are transforming the business. We do not provide a tool that is faster or cheaper, we provide a new way of working and we empower companies to manage their business from a different perspective. We need the right people to send out this message, informing customers on how to transition from a traditional model to a new one.

Q: Which sectors are most interested in these services and what are the main benefits?

A: The telecommunications sector has already incorporated the cloud into its day to day activities and others, such as banking, are increasingly doing the same. To my surprise, the banking industry is increasingly interested in cloud services. The law states the information of financial transactions must physically reside in Mexico so the Mexican Tax Authority (SAT) can audit this more efficiently. We have been working with the National Banking and Securities Commission (CNBV) to have our cloud tested and certified. There are now some banks in Mexico fully running on our cloud. The retail sector also is interested in our services. When customers make an online purchase or interact with the web, they are leaving digital traces. This information is not being used to the benefit of the customer nor the company that could capitalize on this information to better serve those markets.

The retail industry is increasing its awareness of this challenge and is realizing that implementing a digital strategy and hiring data scientists could benefit them. For example, a fitness watch monitors a person’s activity and heartbeat, generating a great deal of information that synchronizes to the person’s phone and the cloud. Companies are doing nothing with this information. The cloud is enabling business models that are impossible without it.

Q: What is your take on the ethical questions raised by cloud technology?

A: Data protection is a chapter that must be rewritten in the near future or the concept in Mexico will be erased because there are some things that can be disclosed and others that cannot. However, there can be huge benefits. There was a physician who realized that premature newborns between 6.5-7 months old had little chance of survival. She discovered a correlation between the deaths and the temperature and the beats per second of the babies’ heart. She dispersed this information and helped reduce the mortality rate from 80 percent to 15 percent. Importantly, the information released onto the cloud included only heartrate, temperature and survival and did not disclose names. The use of digitalization, the Internet of Things and Big Data can save lives. We must change our public policy in Mexico, working hand in hand with the government to align these needs to the new economy.

In Mexico, when developing applications for the web, the intellectual property of that task belongs to the employee that developed it. After two weeks’ work, that employee has the right to a severance package. This discourages people from setting up development centers in Mexico. Public policy needs to be realigned with the digitalization era. The government is realizing this. The challenges Mexico faced a year or two years ago are slowly being overcome. Private and public initiatives are shaping up to push for these changes.

Q: How are you differentiating your cloud services from that of Amazon or other companies?

A: Oracle tries to deliver information technology solutions to empower businesses and manage processes at the lowest cost possible. A new telecommunications company could manage end-to-end processes by engaging with Oracle. Everything from billing to collecting money can all be managed through our company. To provide these end-to-end solutions, the user must have hardware, inside which there must be an operating system. There must be a hard drive to hold this information. There needs to be applications, such as accounts payables and receivables among other more complex applications. Below that there must be a database and a middle layer to connect internal and external systems. There must be a communication layer and in addition to all that, business intelligence or Big Data to manage the business. Oracle is the only solution in the world that provides all of this from a single vendor. Failing to engage with our cloud solution means sourcing all these components separately. When implementing a new system, clients want to see significant improvements in their operations. If a client needs to integrate different vendors and there is an issue, companies will blame each other.

Q: Which sectors are reluctant to incorporate this technology? 

A: Certain segments are slow to install new technology into their businesses. For example, the small and medium business segment is lagging in this area in Mexico simply because companies cannot afford it. Cloud and mobile devices are the key to changing this because the common barriers used to be complexity and cost. The cloud lowers complexity by 90 percent and reduces cost by 70 percent. There is no longer a need to invest in computers as all applications can be accessed through mobile phones. This enables people to get connected without having to invest a great deal of money.

I do not think there are borders anymore. When Brexit was confirmed, our financial market suffered for three or four days. SMEs are realizing they are competing with companies that incorporated technology a long time ago. Oracle is taking advantage of this. The software industry in Mexico grows by around 4-5 percent on a yearly basis. We are growing at double digits, above 30 percent. Technology gives people a competitive advantage to grow faster. A few years back, a solution could be bought and fully customized, which used to take longer and cost more. Different combinations can be chosen within the system to give it different behaviors, but the business flows and processes within the system cannot be changed. They go to market within weeks, rather than months or years.

Q: What alliances or partnerships do you think need to be formed to make Mexico the best it can be?

A: Many companies are making alliances with system integrators and big firms. Small and medium businesses work with recommendations and they trust their counterparts rather than big firms. We need to reach out to trusted advisers and partner with them to extend our reach. When interacting with SMEs, we talk to the owners directly, not CEOs or CFOs, and they want reasons for investing in our products. In this way, Mexico will become more efficient.