Oracle OpenWorld 2015 - Macy’s praises Oracle for changed behaviour and warns against old ways

Profile picture for user ddpreez By Derek du Preez October 28, 2015
Summary:
Macy's is transforming its HR function with the Oracle cloud. However, the retailer was also keen to highlight how the cloud has transformed Oracle's behaviour. Good news for customers.

A woman holds a Macy's Inc shopping bag outside a store in New York

The United States’ largest department store, Macy’s, took to the stage at Oracle OpenWorld this week to talk about its shift from on-premise to the cloud, which is being facilitated by its need to completely redesign its HR function.

Gerry Halphen, VP of HR Business Optimization (a title he himself admits is nebulous), described the incredible scale and difficulties that Macy’s has in hiring tens of thousands of staff each year and how its legacy on-premise systems, of which there are many, were not up to the challenge.

However, what was also interesting about Halphen’s talk was that he took the time to praise Oracle for its changed behaviour within its cloud operations. Specifically with regard to the way it is open to working with the department store to identify solutions, rather than dictating which ones should work from afar.

This is a message that Oracle itself has been pushing at OpenWorld, with claims that the old way of doing things involved multi-year roll-outs and multi-year customisations, which often failed to hit the mark. It now argues that its cloud infrastructure allows for it to be far more agile and attentive in its approach to customers.

That is the nature of cloud, of course. But given Oracle’s rep for sometimes being bullish in its approach, it was good to hear a major customer agree that the company’s approach is changing. Halphen said:

The technology portion of this is just that, it’s just a portion. Because we are literally reinventing how HR is structured, where it does its work, the work that it does and then the tools that it uses to do that work. Because we really wanted to take on something a lot more challenging than doing the lift and shift of technology.

That made that partner decision much more important. What I’m most pleased about - we are about six months into our design phase - I’m pleased with the fact that I’m seeing behaviour out of Oracle that I’ve not seen personally, and I think a lot of people who have been around the industry wouldn’t have seen [in the past] . But it’s the model of the future.

However, Halphen was quick to say that whilst he was pleased with what he had seen out of Oracle thus far, he wouldn’t have put up with anything else given the significant challenges that Macy’s is facing in this area. He added:

But because it’s so complex what we are wrestling with, we need much more transparency, much more willingness to come in and help solve problems collaboratively, rather than [the vendor] just going off and figuring it out and coming back with a solution.

That’s not happening and frankly we can’t accept that. I’m very pleased with Oracle’s ability to come in and work with us. We are operating at a level that is absolutely essential in satisfying our needs going forward.

The project

Macy’s is a $28 billion omni-channel retailer. And like other retailers, it has very busy periods where it needs to hire a lot of people to support leaps in demand. However, when you’re the size of Macy’s, the scale can cause problems. Halphen said:

If we are not the largest, we are certainly one of the largest Taleo recruiting instances in the world. To make anybody here working in recruiting feel better, we hire somewhere between 80,000 and 90,000 in an eight to ten week period, every year. Just let that soak in for a second. So we have had that experience and our team lead has done a phenomenal job of building that so that it’s really a competitive differentiator for us.

However, Macy’s also has a sprawl of applications that have been built up over the years, which Halphen is keen to move away from. The cost of maintaining these, as well as the lack of agility that the complexity brings, has led Halphen to go all in with Oracle and the cloud. He explained:

On the other side of our HR-IT suite, by my count, we had 104 applications trying to solve the problems of HR IT. Most of which were highly customised, including PeopleSoft. They were disintegrated, redundant. Frankly, extremely inefficient. We were throwing the heroism of a few people at problems, it was masking the inefficiency, and we couldn’t scale it. So we embarked about two years ago on a journey to look at this.

I was very clear that we weren’t going to get where we wanted to go in reinventing the HR function with the technology that we had. We decided to evaluate moving to the cloud and because we had a foot in it on the Taleo side, it was a little bit of an easier sell.

But the depth and breadth of Oracle’s offering, the fact that they were clearly investing in the future and then the word ‘partnership’ - we knew that this was going to be a very difficult journey and we chose a partner that was going to be with us for the long-term.

It also made financial sense. Halphen said:

We were investing approximately $2-2.5 million of capital every year to incrementally grow those 104 applications. Now I’m not a math major, but that’s not going to work out well. So we decided to shift our thinking to really bet on [Oracle’s] innovation engine.