Transforming Midmarket Enterprises: Strategic Modernization with Hitachi Digital Services and Oracle

Midmarket businesses are reaching a critical point in the evolution of their core enterprise applications, as legacy platforms lose vendor support and long-standing environments lack the flexibility required for meaningful AI and automation. To move forward, organizations are increasingly adopting modern, cloud-based solutions that provide a simpler, more resilient foundation for applying AI capabilities and proven industry best practices.

As a result, over the past three years, enterprise software transformations, such as ERP migrations, have shifted in focus from initiatives largely justified by cost reduction to programs centered on future readiness, operational agility, and the ability to adapt to changing market conditions. This aligns with PAC’s global CxO survey findings, where 92% of the CxOs stated that their primary reason for introducing new business applications is to transform and optimize processes and workflows, rather than cost savings.

Modernizing legacy applications does not require a rigid, one-size-fits-all approach. It is a progressive journey, and organizations should recognize that the full benefits emerge gradually over time. With the right IT partner, strategy, and roadmap, organizations can achieve both cost efficiency and prepare for the future at speed by leveraging industry-specific solutions, modern best practices, and the transformative power of data, AI, and automation.

This sets the stage for how IT services can support midmarket companies through their application and business transformation journeys, ensuring smooth transitions and maximizing the benefits of new technology coupled with deep industry domain expertise.

The mid-market opportunity

Over the past 12 months, enterprise vendors have introduced new offerings that are more closely aligned with the needs of mid-market organizations. For example, Oracle has revamped its approach to working with services partners to identify and pursue midmarket accounts, which it views as a “huge opportunity.” An opportunity that aligns with PAC’s global CxO study, which shows that 25% of business leaders will invest in Oracle applications over the coming two years.

One of Oracle’s partners capitalizing on this mid-market development is Hitachi Digital Service (HDS). With over three decades of Oracle delivery experience and over 1,000 Oracle Cloud projects across industries, HDS strengthens its services with deep industry-specific expertise, IP and toolkits, and the ability to harmonize systems and processes across the value chain, including hyperscalers (AWS, Azure, GCP), enterprise software (Workday, Salesforce, SAP, ServiceNow…), and the data foundations (Snowflake and Databricks).

While HDS also caters to large enterprises, it sees a significant opportunity in the mid-market ($500m to $4bn revenue range) as the segment is underserved by large system integrators. HDS believes it is a good fit for companies that want the large IT supplier experience with strong brand assurance, at a competitive cost. HDS has adopted a fixed-scope, fixed-price approach as its entry strategy into the mid-market, enabling Oracle sales reps to engage organizations facing tight budgets for migration and modernization.

Conscious of tighter mid-market budgets, HDS brings to market a Business Process Outsourcing-funded transformation. In other words, outsourcing certain processes to aid in freeing up resources or generating savings that can be reinvested into application modernization to drive the implementation of SaaS, reduce headcount, and shift finance roles offshore.

HDS’ core Oracle proposition covers:

• Oracle advisory services (transformation roadmap)
• Oracle cloud applications (SaaS transformations)
• Technology migration (Oracle Database to cloud)
• Oracle EBS (upgrades, enhancements and migrations to Cloud Infrastructure)
• Intelligent managed services (Oracle support and enhancement)

A challenging decision for most organizations is to decide which IT services partner is best suited to lead their enterprise application and transformation journey. This can be challenging as the application landscape comprises various ecosystems (Oracle, Microsoft, Salesforce, Workday, ServiceNow) that need to work in harmony. Hitachi Digital Services (HDS) claims to possess a comprehensive depth of technology and system integration expertise across the value chain, complemented by over 100 accelerators, including cloud/data migration, configuration, automated testing, and Oracle modernization best practices, to optimize processes.

Partnerships and Oracle investments

Capabilities are complemented by a series of domain and industry partnerships to ensure customers maximize the value of their Oracle investments. Their partner ecosystem includes specificals for:

• Barcode and handheld devices
• Supply chain and pharma regulatory specialists
• EPM and CX specialists
• Program strategy and assurance specialists
• Oracle training specialists

Additionally, HDS collaborates with local partners to ensure regulatory compliance and meet specific tax requirements.

Oracle-related investments are expanding HDS’ capabilities through a global Center of Excellence and Shared Service Center, enabling the delivery of preconfigured, industry-aligned solutions, accelerators, and AI-enabled capabilities. Oracle Intelligent Managed Services further support this through automation, SmartOps, and autonomous incident resolution, while ongoing talent investment strengthens delivery capacity through improved resourcing models and certification depth.

The industry-focused approach

HDS predominantly caters to verticals in retail & distribution, energy & utility, financial services, manufacturing, and technology, media, and comms.

For example, operating in a high-transaction-volume building materials distribution industry, a leading Builders Merchant required a scalable, automated finance solution. Oracle Fusion Cloud ERP was chosen for its ability to automate manual processes, provide real-time and accurate data, support compliance through regular cloud updates, and enable more strategic forecasting and decision-making. HDS was a strong fit due to its deep understanding of Travis Perkins’ business, gained through a rigorous discovery phase, strong cultural alignment, and an iterative, agile delivery approach, which gave confidence in the solution’s quality, suitability, and long-term partnership.

HDS further differentiates itself by moving beyond standard Oracle configurations, leveraging industry-specific toolkits, such as the Retail & Distribution kit, with preconfigured cloud instances and best practices. These curated capabilities, including accelerators such as intelligent order orchestration, unified inventory visibility, and cash sales automation, among others, enable a faster time-to-value. The firm reports use cases where its automation kits have reduced the need for up to ten full-time resources in functions such as accounts payable.

Moving forward

Midmarket businesses stand at a crucial crossroads as they move away from outdated legacy systems towards modern, cloud-based enterprise applications that enable AI integration and future-ready agility. This shift reflects a broader industry trend where the focus has evolved from mere cost reduction to transforming and optimizing processes with the help of trusted IT partners.

HDS and Oracle are key contributors to this transformation, offering tailored solutions specifically designed for the mid-market segment. HDS’s fixed-price, fixed-scope approach, combined with business process outsourcing, supports organizations with tighter budgets. While they also cater for more complex requirements with their comprehensive Oracle services and deep industry expertise, as experienced by a Retail Distribution company which moved from a previously failed ERP transformation to a successful outcome with Oracle and Hitachi.  

Ultimately, midmarket companies require partners who understand midmarket operating models, industry-specific requirements, and how to effectively apply best practices.