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U.S. Public Sector Eases Into Oracle Cloud Migration

State and local governments, heavily invested in Oracle solutions, outsource modernization after work disruptions shrink IT departments, ISG Provider Lens™ report says

State and local governments in the U.S., many of which use Oracle database management systems and applications, are beginning to pursue application modernization and cloud migration amid significant financial and staffing constraints, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The 2022 ISG Provider Lens™ Oracle Ecosystem report for the U.S. Public Sector finds that state, local and educational (SLED) organizations in the U.S. are under increasing pressure to migrate their Oracle implementations to the cloud to meet new requirements for efficiency, data sharing and constituent services. Due to labor shortages that grew worse with the COVID-19 pandemic, they are turning to service providers to plan and carry out these transitions, most of which are still in the early stages.

“The Great Resignation hit the public sector just when IT modernization became mission critical,” said Nathan Frey, partner and public sector transformation expert at ISG. “There is an almost unprecedented need to address technology and IT staffing requirements through external contracts and service providers.”

U.S. governments and agencies tend to use Oracle products for sensitive core functions such as finance and public records management, and they have a natural aversion to rapid change and disruption, the report says. As a result, many are taking an incremental approach to application modernization, engaging with service providers to rehost or re-platform their existing Oracle applications to deliver familiar user experiences at lower cost.

Deriving more value from data is also a major thrust of many digital transformation projects in the public sector, ISG says. New types of public services require access to once-siloed data by more agencies and constituents. SLED organizations are turning to Oracle ecosystem partners to extract, refine, consolidate and convert agencies’ reams of accumulated data from on-premises systems such as Oracle E-Business Suite for migration to Oracle Cloud.

“The cloud opens up many new uses for public data to serve constituents and multiple agencies,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “Oracle partners offer a growing number of tools to ensure the quality and accessibility of that data.”

As keepers of highly sensitive information about constituents, U.S. public sector agencies focus closely on security from cyberattacks when selecting service providers and moving existing functions and data to Oracle Cloud environments, ISG says. Strategies for achieving sustainability and other environmental, social and governance (ESG) goals are also increasingly important in the U.S. public sector, as in other industries. Service providers are helping public agencies implement single, integrated Oracle platforms that make it easier to monitor and report ESG metrics.

The report also examines other issues affecting Oracle users in the public sector, including competition between Oracle Cloud Infrastructure and other hyperscale public cloud platforms.

For more insights into the challenges facing U.S. public sector agencies, and advice about how to initiate and scope out Oracle application modernization projects, see the ISG Provider Lens™ Focal Points briefing here.

The 2022 ISG Provider Lens™ Oracle Ecosystem report for the U.S. Public Sector evaluates the capabilities of 20 providers across three quadrants: Consulting and Advisory Services, Implementation and Integration Services, and Managed Services.

The report names Accenture and Deloitte as Leaders in all three quadrants. It names Huron, IBM, Infosys and PwC as Leaders in two quadrants each and DXC Technology, KPMG and Wipro as Leaders in one quadrant each.

In addition, Huron, Infosys and KPMG are named as Rising Stars — companies with a “promising portfolio” and “high future potential” by ISG’s definition — in one quadrant each.

The 2022 ISG Provider Lens™ Oracle Ecosystem report for the U.S. Public Sector is available to subscribers or for one-time purchase on this webpage.

About ISG Provider Lens™ Research

The ISG Provider Lens™ Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across Europe, as well as in the U.S., Canada, Brazil, the U.K., France, Benelux, Germany, Switzerland, the Nordics, Australia and Singapore/Malaysia, with additional markets to be added in the future. For more information about ISG Provider Lens research, please visit this webpage.

A companion research series, the ISG Provider Lens Archetype reports, offer a first-of-its-kind evaluation of providers from the perspective of specific buyer types.

About ISG

ISG (Information Services Group) (Nasdaq: III) is a leading global technology research and advisory firm. A trusted business partner to more than 800 clients, including more than 75 of the world’s top 100 enterprises, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes in digital transformation services, including automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn., ISG employs more than 1,300 digital-ready professionals operating in more than 20 countries—a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry’s most comprehensive marketplace data. For more information, visit www.isg-one.com.

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