Supply Chain Matters concludes its series of commentaries from this year’s Oracle Open World held in San Francisco last week with our summary impressions of this large-scale event. We have had the opportunity to both catch-up on rest as well as review our extensive notes. We thank Oracle for providing Supply Chain Matters open access to customers, senior executives and all of the numerous sessions that consumed nearly four days of conference events.

Oracle leveraged this year’s OpenWorld by raising the stakes in both cloud based and database computing.  Oracle is betting big on the fact that both business and IT teams, who remain constantly under pressure for continued innovation and higher productivity with lowered overall costs, will turn to a select few enterprise-level providers for business computing alternatives. Oracle desires to transform its entire collection of IT hardware, database, middleware and business applications into a collection of hosted, pre-configured engineered products under the Fusion umbrella. Oracle has also internalized that, today, businesses desire choice in cloud computing options, and Open World was utilized as a means to communicate a combination of customer computing options ranging from software-as-a-service (SaaS), infrastructure as-a-service (IaaS) to private or hybrid cloud computing options.

Similar to SAP, Oracle now understands that decision-making enabled by in-memory and advanced analytical capabilities are a game changer for businesses, and it is not going to concede market leadership of this capability to any competitor.  We were particularly impressed with Larry Ellison’s stated challenge to enhance Oracle’s data analysis capabilities by transforming data intelligence needs directly to custom silicon chips to scale and speed-up performance.  Ellison also articulated one of the clearest explanations of what really differentiates multi-tenant cloud computing, the method that security is enabled. All of these stated directions could be a market game-changers for Oracle.

How successful Oracle ultimately becomes with this strategy depends on overcoming previous market perceptions for being the most arrogant and perhaps the most expensive technology provider, as well as how collaborative Oracle can work with its ecosystem of partners to enable leading-edge services that attract customer adoption.  Oracle is also savvy enough to figure out that adoption of cloud computing comes from a keener focus on business pain points vs. an overall IT productivity play. Overall, we believe that industries and businesses will benefit as a hyper-competitive chapter begins in cloud-based computing.

The following are some further impressions we walked away with:

  • Since joining Oracle in 2010, after his controversial departure as CEO of Hewlett Packard, this year’s Open World provided the opportunity for Mark Hurd to step into a more visible leadership profile.  Hurd anchored two separate keynotes, and was featured in the designated Oracle press conference and the designated executive voice of Oracle with the various high-profile business media attending this year Open World.  A Wall Street Journal article noted that Hurd claimed to have met with more than 600 Oracle customers during the week-long event. During the summer, Hurd was placed in charge of Oracle’s overall sales teams, hired an additional 3000 sales types and has reorganized teams into product specialization vs. selling a collection of various product components. According to the WSJ, a new commission structure incents sales representatives to sell more cloud-based versions of Oracle offerings. In the software industry, incentives are the prime mover of sales momentum, so rest assured your friendly Oracle sales rep will be calling with a compelling argument to transform computing to the cloud.
  • As noted in one of our earlier commentaries, we were impressed with some of the capabilities that have been added to Oracle’s E-Business Suite, advanced supply chain planning and execution applications.  We were further impressed with some of the stated concepts and capabilities being discussed for future Oracle Fusion-based SCM capabilities, including a notion of multi-enterprise, B2B clouds. The fuzziness and lack of clarity in development timetables however imply that interested customers will have to entertain co-development or first-mover stances. Overall, Fusion SCM is not going to capture broader customer attention nor motivate them to wait for Oracle at this particular point, given this roadmap fuzziness. We trust that this strategy will change in the coming months.
  • We were especially impressed with the penetration that Oracle has made in the high tech and consumer electronics sector, which comes with its own unique global supply chain and B2B fulfillment challenges. In addition to noting two sessions focused on the ongoing technology transformation occurring at Cisco Systems, the current listing of over 50 high tech customers is much more extensive than previous years.
  • Oracle has now come to the realization that unstructured and social based data can be just as important as structured data in business analysis and needs for decision-making.  We noticed more mention of the information discovery capabilities brought forward with the previous Oracle acquisition of Endeca, with implications for areas such as customer services, supply chain, product life-cycle management and other areas of B2B fulfillment. Rick Jewell, Oracle Senior Vice President of SCM, articulated the notions of “embedded social” in a variety of supply chain related information capabilities.
  • Integration partners such as Infosys and others have played and will continue to play a key role in helping to broaden the overall capabilities and horizontal market adoption of Oracle technology. As an example, Supply Chain Matters had the opportunity to attend a session titled Project Driven Supply Chain that addressed an expensive problem for major equipment manufacturers the synchronization of supply chain and service installation milestones and revenue plans. Today, 30 to 60 percent of total revenues of equipment providers is derived from turn-key bundled products and services that are highly dependent on customer installation scheduling. Infosys and Alcatel Lucent have partnered to develop an integrated capability that links revenue forecasting, S&OP and supply chain planning with project-driven management capabilities that allows an equipment provider to iterate various scenarios of coordinated customer installations. Overall, partners will be instrumental in accelerating the customer go-live adoption of Oracle Fusion and advanced decision-making support based offerings.

While Oracle Open World can sometimes be viewed as a purely sales-driven event designed to prime customer interest, we continue to find this event informative. We were pleased to be designated one of few bloggers and influencers to be invited. Oracle, like other enterprise and supply chain focused software providers continues to adjust to the new reality that market influencers come from independent minded observers that combine both trusted industry analyst, market awareness and social based influence skills.   We also thank our sponsor Infosys for designating this event as one for prime coverage.

Readers can view all previous commentaries by clicking on the below links;

Commentary One

Commentary Two

Commentary Three

Commentary Four

This concludes our series of Supply Chain Matters commentaries from the Oracle Open World 2012.

Bob Ferrari


Appropriate Disclosures: Infosys is one of other designated sponsors of the Supply Chain Matters Blog. 

Oracle is neither a current sponsor of Supply Chain Matters, nor a current client of our research or consulting services.