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Oracle Proud To Be Number Two

Written By: Steve McVey
Published On: July 14 2000

Oracle Proud To Be Number Two
S. McVey - July 14, 2000

Event Summary

Being number two in the advanced planning and scheduling (APS) software market is becoming a coveted prize for old guard ERP vendors. Just four months ago, at a press/analyst event in Waltham, Massachusetts, SAP announced that its Advanced Planner & Optimizer (APO) had captured the number two spot from Manugistics Group based on APO's fourth quarter 1999 license revenue of $25 million (see TEC news analysis, "SAP Declares Victory Over Manugistics, Takes Aim at i2").

Recently, it was Oracle's turn to proclaim the title of "second best" with over fifty small to mid-sized and large companies signing up for its new advanced planning and scheduling (APS) solution in its first quarter of availability. The larger of the client guinea pigs include Alcoa, Cummins Engines, EchoStar Communications, GE Aircraft Engines, Ford Motor Company, Hitachi Data Systems, Odwalla, TRACO, and UPS.

Market Impact

It seems clear that when Larry Ellison is not ruffling feathers in his private jet or making waves in his yacht, he maintains the "common touch" by personally writing his company's press releases. The recent announcement came within days of Oracle's claim to have surpassed SAP as the world's number one software vendor. When it comes to supply chain management, however, both vendors seem content to take a back seat to i2 Technologies - at least for a while.

Oracle and SAP will be successful selling their APS solutions to organizations for whom "interface" is a dirty, nine-letter word. True, interfaces require considerable design and development resources to implement and afterwards must be updated with new versions of software and changes in technical infrastructure. This fact is responsible for much of the success of ERP vendors in beating out best-of-breed vendors in supply chain software selections among existing customers.

Oracle's initial success may be due primarily to the interface aspect, although Oracle has been plagued in the past by integration issues with acquired products. A more likely explanation is that Oracle made price concessions on APS in order to assuage client fears over product stability and functionality. Oracle will achieve longer term growth in SCM market share only if Oracle APS proves to be a viable alternative to what the best-of-breeds can offer.

In spite of the late entry and questionable competence of APS, Oracle presents an immediate threat to i2, Manugistics and other SCM vendors. Oracle has outstanding ERP market position, excellent financial standing, and a strong direct sales force. The big question will be whether its account executives will find selling Oracle APS easier than i2 RHYTHM or software from one of its many other third party product alliance partners.

User Recommendations

Users among Oracle's 6,000-plus installations should make a careful comparison between Oracle APS and the i2 products that are available as embedded software within the Oracle Application suite. Although some who have seen demonstrations of Oracle APS have favorable things to say, users should avoid accepting second-hand reviews on faith and conduct their own scripted scenario demonstrations tailored to critical business processes.

In addition, Oracle users should remember that APS is supported as an add-on only for Oracle 11i and 10.7 and those with prior releases will be required to upgrade to obtain the new product. Non-Oracle users have a multitude of advanced planning and scheduling packages from which to choose, including i2 Technologies, Aspen MIMI, Manugistics and Logility, and APS should not be the prime candidate on their lists.

 
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