Challenges
Thus, Oracle's belated humility in terms of increasing its products' openness is commendable, although long overdue and not coming from the bottom of its heart, but it could help it succeed in obtaining more projects much more than other utopian initiatives to capture new customers. One of these, the assertion that Oracle would replace all existing applications with its 11i for free, including all software, hardware upgrades, migration, and consultancy services, in return for a five-year commitment, might make this proposition more appealing. The fact that the cost of this offer is the existing Information Technology (IT) budget of the enterprise, with a prospect of Oracle replacing legacy applications, guaranteeing all upgrades, and of paying 5% less for each of the five years, might have an appeal if there had not been many controversies and glitches of Oracle's dealings with customers in the past. The last thing Oracle needs is the recent controversy about alleged extraneous license fees and its aggressive sales tactics. Any perception of its desperate need to bolster new license revenue with means that justify the end, would be quite detrimental.
While the increasing sales of upgrades to the new 11i product may indicate that Oracle has begun to clean its act. There are now reportedly close to 1,500 of live customers on the new 11i suite, compared to mere a dozen a year ago. Still, many clients implementing or upgrading to Oracle's E-Business Suite 11i, cite that the quality problems have not completely faded away. The software is still being patched continually and many of the issued patches, especially so called "Family Packs" of dozen patches, introduce as many serious problems as they resolve the original bugs, owing to the tight integration and module interdependencies within the suite (too much of a good thing).
Oracle also reports that there are over 5,000 other customers in various stages of transition to the 11i suite, but the company should also bear in mind that its statements will be examined through a magnifying glass and with a skeptical eye. Oracle's strategy to expand the functionality scope of the 11i e-Business Suite may indeed be attractive and encouraging for existing users because it could enable them to leverage their investments in the Oracle database and/or applications. Oracle advertises its 11i suite to be a "one-stop shop" business application solution, underpinned by a single, coherent data model that is resident in a single database. This is a convincing vision in a traditional ERP market that typically dreads building and maintaining multi-solutions integration mechanisms. These customers are opting for seamless integration to the database and a strong Java-based development environment that is finally permitting some level of customizations too.
Finally, Oracle might not need any significant cutting edge technology or product to win new customers over. The company might be much better off if it should espouse an offering that is more amenable to all, but particularly to smaller companies, which means more digestible, more open, more vertically focused, more customization-friendly, and more consistently/clearly priced. The above-mentioned ERP/CRM development teams reorganization may be a good step towards addressing these long overdue issues. The move particularly makes sense when one bears in mind the tight integration within the Oracle 11i suite that blurs the demarcation point between front- and back-offices and links supply and demand. Still, it appears that users' multi-solution reality has yet to be acknowledged by Oracle, at least officially. Time will also tell, therefore, whether Oracle will have used these slower economic times to get its act together and to position itself for a much-needed surge of new projects in the future. Otherwise, it may end up looking at PeopleSoft's rear lights.
This is Part 4 of a 4-part examination of recent Oracle announcements.
Part 1 and Part 2 detailed the announcements.
Part 3 began the discussion of the Market Impact.
This Part makes User Recommendations.
User Recommendations
The market should regard Oracle's new mindset evolution as well as its new customer placating moves favorably, despite inevitable controversy. Larger enterprises seeking broader e-business capabilities should evaluate Oracle if they feel comfortable with Oracle's one-stop-shop offering and if Oracle has a good track record in their industry vertical.
Enterprises that favor a multi-vendor approach should still evaluate Oracle if the functional fit is good, but they should reckon with a challenging integration project. They should strive to minimize the total number of vendors in the total business solution. Additional caution should be exercised when deploying 11i application components whose tires have not been quite kicked in live conditions. Use the forthcoming upgrade times to evaluate newly released modules and compare it with other products to weigh whether the intrinsic integration is more worthwhile than a possible limited functional scope and maturity. Also, any new contracts should be well scrutinized in order to ensure that the contract verbiage is clear and explicit as to preempt any future contract revisions, grievances and misunderstandings.
Smaller companies with a need to automate many administrative (e.g., financials, human resources, customer relationship) chores should still benefit from evaluating Oracle Fast Forward Flows or Oracle Small Business Suite, possibly in the ASP mode. But, make sure to carefully read the contract fine print to discern all the probable limitations and exclusions, such as customizations. Clients should thoroughly evaluate the benefits, as well as the potential business constraints, of the ASP option, and should make evaluations based on referenceable clients.
Given the more upbeat 11i product upgrade experiences of Oracle customers, 10.7 users with acute Euro compliance issues should opt for an upgrade without much delay. Other existing Oracle customers considering an upgrade to 11i should nonetheless base their decisions on the reference-proven functionality of the 11i components they are evaluating, rather than on mere "brochureware" enhancements. Bear in mind that the manual processes used to apply patches and to migrate configuration data and customizations from instance to instance are very error prone, sometimes requiring a number of attempts. If your volume and repeated cycles of patching and testing of 11i are huge, consider using a tool to automate patching and migration, and other functions, such as problem tracking and resolution, and stress testing. Not to mention that Family Packs recently issued should be rigorously tested before going live with the system.
This concludes Part 4 of a 4-part examination of recent Oracle announcements.
Part 1 and Part 2 detailed the announcements.
Part 3 began the discussion of the Market Impact.
This Part makes User Recommendations.