'Collaborative Commerce': ERP, CRM, e-Proc, and SCM Unite! A Series Study: Oracle

A Series Study: Oracle
R. Garland - November 22, 2001

Introduction 

In the early 90's, ERP came of age. Everyone had to have the functionality ERP packages promised. Since then, as Web and Internet technologies have matured, CRM packages on the front end, and e-Procurement and Supply Chain Management packages on the back end, these packages have come into their own.

Now in 2001, the catchphrase is "Collaborative Commerce," where we unite all of the above elements into one coherent system within and between organizations. This is the Big Kahuna, the zero latency, fully transparent, 360 degree exposure that is the stuff systems integrators dream of. Is it here? Are the technologies mature enough? Simple enough?

This, the fifth in a series of articles on Collaborative Commerce (C-Commerce), takes a look at Oracle's vision of C-Commerce, a vision which some may consider expansive but myopic by nature.

Oracle's Database: Blurring the Lines Between Database and Application 

Oracle has always been known for its robust database solutions, and less well-known for its suite of applications which, up until version 8i (released in March of 1999) was, in its most stable form, text-based, dumb-terminal style. Oracle made haphazard efforts in the mid 90's to bring its applications (primarily ERP - Financials, Manufacturing, and Logistics) to the browser, but its solutions were buggy, difficult to use, and often didn't match the feature and functionality set of its text-based brethren.

March 1999 saw the introduction of Oracle 8i ("i", for Internet) database, Oracle's first serious push toward web-oriented functionality. What was interesting from the start was how Oracle has chosen to define its functionality set for its products. Oracle 8i RDBMS extended Oracle's technology in the areas of data management, transaction processing, and data warehousing. Built directly inside the database, Internet features such as Java Server, an "Internet" File System, Internet Directory services, and Internet Security allowed companies to build Internet applications while blurring the definition of what a "database" means and represents.

In June 2001, Oracle introduced Oracle 9i, which further extended the database's functionality, and, as well, continued to blur the lines between database and application. Oracle 9i includes something they call Real Application Clusters, which enables multiple copies of the Oracle 9i database to be instantiated across multiple servers, acting as a single database in a cluster, for considerable performance improvement. Customers can add computers to the cluster, and the database software transparently adapts to utilize the new computing resources, significantly improving application scalability and availability without forcing the customer to modify their applications.

In addition to Oracle9i Real Application Clusters, other new key features of Oracle9i included improved database availability, functionality, enhanced security capabilities, and a more complete and integrated infrastructure for building business intelligence applications, with built-in capabilities for Data Warehousing, Extraction, Transformation, and Loading (ETL), OnLine Analytic Processing (OLAP), and data mining.

Oracle's Application Server: 9iAS Provides More Functionality at the Middle Tier 

In June 2000, Oracle 8iAS Internet Application Server was introduced. Oracle billed 8iAS as "an open software platform for developing, deploying and managing distributed Internet software application programs."

Further refining and defining the Application Server functionality, Oracle released Oracle 9iAS Internet Application Server in October of 2000. 9iAS includes J2EE (Java 2 Enterprise Edition), XML, and JDBC support, as well as new caching technology. But it goes considerably beyond that, by including the following components:

• Oracle 9iAS Personalization- Provides the ability to personalize the customer web experience based on various criteria, for "true 1:1 marketing."
  
  
• Oracle 9iAS Portal - For customers, employees, and partners. Portal sites are assembled using portlets, which are reusable interface components that provide access to Web-based resources such as applications, business intelligence reports, syndicated content feeds, hosted software services or other resources.
  
  
• Oracle 9iAS Wireless - Provides wireless (including voice) access to Oracle applications.
  
  
• Oracle 9iAS Business Flows - Provides facilities for notifications, alerts, and escalations.
  
  
• Oracle 9iAS Email - A simple email handling package.
  
  
• Oracle 9iAS Unified Messaging - Provides multi-channel support (phone, web, fax, email).

Oracle E-Business Suite: The Top Layer 

Oracle E-Business Suite Release 11i has been on the market for about a year. It integrates CRM, ERP, and SCM functionality components to the point where Oracle feels it can claim that it is "the only company to offer a fully integrated suite of business applications, managing the entire business cycle on a global basis and solving end to end business problems." Oracle breaks out E-Business Suite Release 11i in the following categories:

1. Business to Business
   Enables trading Partners, through Oracle Exchange, a B2B Marketplace, to share data in the supply chain and product development processes.
   
   
2. Business Intelligence
   Oracle lists Business Intelligence as part of the E-Business Suite, but the functionality is actually part of their 9i database. Take note that their literature says their business intelligence solution is "fully integrated with," but not part of, the E-Business Suite.
   
   
3. CRM
   • Oracle Marketing - Campaign and events management.
     
     
   • Sales - Direct-, Tele-, and Web-sales, as well as Incentive Planning.
     
     
   • Service - Customer support, field service, depot repair.
     
     
   • Contracts - Contract maintenance, in support of Sales.
     
     
   • e-Commerce - Internet marketing, selling, and servicing. Includes Storefront functionality as well as Product Configuration.
     
     
   • Oracle Interaction Center - multi-channel incoming support. Again note that, though this is listed under Oracle E-Business Suite, this functionality is actually provided in Oracle's 9i Application Server.
     
     
   • Business Intelligence - Listed once again, and again, actually part of the 9i database.
     
     
4. Financials
   Classic AP/AR , GL.
   
   
5. Oracle HRMS
   Workforce intelligence and analysis, Payroll, Self-service.
   
   
6. Projects
   Activity and Project based decision-making and analysis.
   
   
7. Verticals
   
   
   • Aerospace and Defense
     
     
   • Communications and Media
     
     
   • Consumer Sector / Retail Financial Services / Banking
     
     
   • Utilities

Oracle's Multiple Tier Approach: Confused Yet? 

Basically, you need to buy all three products, Oracle Database, Oracle Application Server, and Oracle E-Business Suite, to have Oracle's complete C-Commerce solution. Oracle has split functionality that other companies include strictly at the application layer, across their three layers. Oracle, and Oracle alone, can do this; no one else in the marketplace has all three platforms across which to spread functionality.

Observations

First, to expand on the notion of Oracle's three-tiered approach to Collaborative Commerce: Oracle has made what we believe to be some shrewd marketing and product positioning decisions to embed different but critical functionality at all three layers. Would you buy their E-Business Suite, but forego Business Intelligence (Database), or Personalization, Wireless Support, Workflow, or Unified Messaging (Oracle Application Server)? Well, for starters, you can't avoid the Business Intelligence piece, since the E-Business Suite only runs on the Oracle database. And the key C-Commerce functionality built into the Application Server is also difficult to forego if you want a complete solution.

By disbursing capabilities across the tiers, Oracle forces customers seeking a complete solution to buy all three, pushing Microsoft's SQLServer and IBM's DB2 databases out of the picture, as well as IBM's WebSphere and Bea's WebLogic application servers. Very shrewd.

Other notes:

• Mr. Ellison specifically stated that companies should forego designing their own business processes to match their company and their company strategies. Companies should simply follow the business processes dictated by the Oracle software. He pushes aside the reality that unique business processes are required for companies to be successful. He believes and proselytizes that one size will fit all of the millions of product and service companies, both large and small, in the world. But every company is inherently different, with different data storage and access needs, different ways of operating based both on culture, history, organization, and industry requirements. Following dictated business processes means curbing your ability to differentiate and potentially gain competitive advantage in your business processes.
  
  
• In the year since its introduction, 11i has been plagued by bugs - over 5,000 of them. Laments Jim DeMin, a program manager at Infonet Corp. in El Segundo, Calif. "You have no idea what it is to support Oracle here. You install the basic product. And then you install the patches, and then you install the patches to fix the patches that broke. Then you have workarounds, which is to bootleg the patch in some fashion. It's like the starter isn't working in your car, and the workaround is to get out there in your dress clothes and push 10 miles down the road every morning."

This is nothing new: Oracle has the history of pushing software out the door before its time, letting early customers bleed all over themselves as they essentially perform the Quality Assurance testing on the product, and then over time, companies gain relative platform stability.

• According to Steve Kissinger, an information manager at Airborne, a sizable chunk of the $2 million they had to spend to upgrade to 11i went to buying new PCs after they found that 11i would not operate at acceptable speeds on slower machines, despite Oracle's frequent claims that 11i will run on any Web browser, which implies the fastest CPU's and large amounts of memory should not be needed.

In August of this year, Oracle reversed itself on its policy toward integration to other vendors' software with Oracles' 11i. Mark Barrenechea, Oracle senior VP of application development, was quoted as saying that integrating the company's applications with others' software has been "very difficult" and that Oracle is changing its strategy to allow customers to more easily integrate Oracle applications with those from other vendors. They plan to, before the end of the year, release API's and data schemas that would make such integration easier.

This move will hopefully provide those users who aren't ready to move to an all-Oracle solution, the ability to pick and choose among Oracle's best (or most ready) stuff, and integrate it with their own, current and legacy applications

The Bottom Line 

1. Oracle is the lone wolf in the Collaborative Commerce world. They have, until very recently, insisted that Oracle 11i E-Business software, combined with Oracle's 9iAS application server and the Oracle 9i database, was all the software that an enterprise would need. Other companies prominently support integration with other companies, freely acknowledging that no one company can provide all of the functional requirements for every company. Oracle's reversal of strategy is most welcome, and we hope they continue to provide at least this level of integration support into the future.
   
   
2. The "Three-Tier Lock-In" marketing strategy is shrewd for the company and expensive for the customer.
   
   
3. Scads of bugs have always, and continue to, worry us about newly-released Oracle software.
   
   
4. Oracle has a significant case of "Not Invented Here" syndrome which means, almost by definition, that they will not have best-of-breed software across the spectrum.
   
   
5. Finally, Oracle's "follow our business processes and throw your own away" message is simply not in line with what many companies want to do; namely, optimize their own business processes for competitive advantage.

User Recommendations 

If you're a current user of Oracle and you're in the Oracle pipeline somewhere, then, unless you have tremendous, compelling reasons to be C-Commerce enabled today, our suggestion is to wait on a move to 11i. Let bug releases continue until the pace slows, and then make the conversion. In the mean time, push on Oracle hard to continue its support of your current platform.

If you are not a current Oracle customer, it's fair to consider Oracle's one-stop approach, particularly if you want to deal with a single vendor and you want IT staff that need to be trained on only one vendor's technology. Be aware, though, that typically, the shear bugginess of newly-introduced Oracle software makes support costs high compared to many other possible solutions. Also, locking yourself in to one vendor's solution from front to back and top to bottom means dependency on their processes, bug fixes, product enhancements, product architecture, and costing structure. Finally, Oracle's "Not Invented Here" syndrome stands a close second to their "Thou Shalt Not Touch Our Code" rhetoric. Spend the big bucks on the database if you wish. Consider Oracle if one-stop-shopping is your vision of Nirvana. But be aware of the potential pitfalls.

Look for future articles in this series on IFS and PeopleSoft.