By Siobhan Kennedy in Orlando
Oracle Corp used the first day of its user conference in Orlando Monday to announce, for the second time this year, the new version of its applications suite, 11i. Users attending the four- day event were expecting to see the official launch of the suite this week, but instead Oracle officials told them the roll out has been delayed until early next year. The basic ERP functions, human resources, manufacturing and financials and will be available in the first quarter while an updated version of its order management software (originally expected as part of version 12) along with integrated customer relationship management modules, will be released in the second quarter, the vendor said.
So with no applications ready to roll, Oracle had no choice but to use day one of its user conference to highlight the benefits of 11i over the previous release, version 11. Top on the list was integration of its CRM suite with its ERP offerings; what Oracle says is a first among application vendors. But equally important is the delivery of a new application architecture that it says will enable companies to run their entire worldwide operations from a central site, significantly reducing costs and giving users a unified access to its applications. Now in 11i, CRM and ERP get married together in the one global application…this is the first time that’s happened, no-one else has that, Oracle’s president Ray Lane told ComputerWire.
Being able to integrate customer facing applications with back end, ERP systems is what all software vendors, both front and back office, are currently striving to achieve. The ability to sell customers an end-to-end integrated offering which enables users (customers, partners, sales teams, suppliers and so on) to directly interact with back office systems is a compelling proposition, but one which most vendors are still talking about and few are offering. Earlier this month, SAP outlined plans to integrate its CRM suite with its back-end ERP and supply chain system, but the bulk of its products won’t be available until mid-2000.
And other ERP vendors, like PeopleSoft and JD Edwards, with no CRM offering of their own, are rushing to partner with front office vendors. But customers still look at that and still see two companies, two different cultures, two different products, two different tool sets, two different contracts, Lane says. I could give you a URL and you could be using these applications tomorrow morning. You can not do that with anybody else’s applications; Siebel, SAP, PeopleSoft, you can’t do it.
What this means to the user, Lane says, is that he or she can sit on an internet browser, come through Oracle’s CRM system and see our entire supply chain, He added: Say GM [General Motors] is running our ERP systems, the customer can come to the GM web site, see the car they want and they [GM] can tell you the promised delivery date on that customized car by knowing what the supply chain can deliver.
Using the same example, Lane that SAP’s applications can manage the supply chain, but if a user wants to place an order, he or she still has to speak to an agent who in turn has to manually go into the ERP system and check for availability. There’s a lot of manual work, he says. What we want is a customer sitting on a browser to just come to our web site and be able to go automatically into the supply chain.
David Caruso, VP and service director of enterprise application strategies with Boston-based AMR Research said while it was disappointing 11i wouldn’t be available on time, the suite is pretty much signed, sealed and delivered now. He added: Oracle has detected the momentum in the market and has positioned itself to take advantage of it. Furthermore, while companies like SAP and PeopleSoft are talking the integration talk, Caruso says that Oracle has the best footprint for delivering on that model. It’s not all there yet, some CRM is integrated but there’s some still to come. But SAP’s still working out its integration issues. It’s still got a long way to go with its CRM suite. Baan is also in the marketplace but a lot of its story is buried underneath Baan ERP.
The other key selling point of 11i, Oracle says, is its ability to let companies run all their applications from a single, centralized datacenter. Lane says most of Oracle’s customers have now swallowed the lots of little servers everywhere equals increased costs and bad management story, and they’re now keen to consolidate their systems into one.
The real value is taking the applications and consolidating the data, so I can have one application that serves Germany, in German with German localization and that same application is serving China in Chinese with Chinese localization, he says. They’re running in the same application instance. That’s what saves all the money. Because I can make a change to that one application, and the browsers in Germany and the browsers in China automatically see those changes.
Lane says customers will be able to cut costs by a factor of ten or more by consolidating their applications in this way. If you’re spending 10 million, you ought to be able to bring it down to two or three million to run that application, he says.
To enable that to occur, Lane says that Oracle has made changes to the architecture of its applications. All the software now runs from a single code base, including localizations, currencies, languages and so on. In addition, the company has tightened the integration between 11i and the parallel server capabilities of its database, Oracle 8i, to improve scalability. And the entire suite has undergone a GUI overhaul, to make it as easy to ease Oracle’s applications as it is to use Amazon’s web site today, Lane says.
To prove its case, Oracle itself is in the midst of an 18-month plan for centralizing its applications, used by its 40,000 staff. The number of datacenters started out around 80 or so but now that’s down to just 37 and Oracle says it will have whittled that down to just one by the end of 2000.
AMR’s Caruso says the biggest challenge for Oracle is execution. That’s the most important thing right now, he says. Oracle’s done a good job marketing e-business. As an organization it has one message and that’s the hallmark, I think, of a company that’s poised for success. But it needs to make sure it delivers on time.
Pierre Mitchell, senior analyst for enterprise applications with AMR agreed but said he thought SAP was doing a better job when it came to communicating its plans to link its systems into a collaborative marketplace in which suppliers, partners and customers can all interact on line. While Oracle used the press conference to talk up its Exchange marketplace, Mitchell said there was still very few details available as to partnerships and content deals. SAP is meeting with industry leaders and jointly developing its mySAP marketplace with its customers, he said. Oracle needs to do the same. To talk about its plans for taking Exchange and forming vertical alliances with some of the key supply chain gorillas.
In related news, Oracle also used the show to announce Accelerators, which offer tools to help companies implement e- commerce software. Developed by Oracle Consulting, the aim of the Accelerators suite is to help companies assess where they are in terms of e-commerce applications and to help them build out their strategy using Oracle software. One component of the suite, called the e-Valuator helps companies review five business areas and determine where they are compared to where they hope to be.
In addition, Oracle teamed up with Compaq, Hewlett-Packard, IBM, and Sun Microsystems to announce release one of its Applications System Bundle. The bundle lets those vendors – plus channel partners and system integrators – pre-install Oracle applications on their hardware.
