Oracle Is a Leading-Edge Technology Company Oracle Corporation is a very successful, high-technology company. The database, programming tools, applications, services, support, and educational products from the company use modern computer hardware and software capabilities. Oracle advertises itself as the second largest software company in the world. Through its actions and alliances with other high-technology companies, Oracle influences the working and computing environment for millions of users. Oracle Corporation customers should understand and react to the attributes of their favorite database and ERP applications vendor. For example, in the software industry, a system might be rushed to market for competitive reasons. If the support and the quality of the product are not quite ready for release, you must deal with those problems while enjoying the improved features and performance. The following attributes of Oracle's business model might affect your ability to use the software. Rapid Growth Oracle competes aggressively and tries to grow its business rapidly. The sales force has always been considered high-powered and aggressive. Annual revenue growth for the past five years is about 35%, and ERP Applications and Services is a significant part of fiscal 2001's total revenue of approximately $12 billion. The company strategy is aligned to take advantage of the growth in Internet technology and products. New Products and Capabilities To sustain revenue growth rates of 30%40%, Oracle has introduced new products and services every year throughout its history. Often, the products improve dramatically over the capability of earlier versions, and the company regularly produces better-than order-of-magnitude improvements in the software performance. In 1995, 50GB was considered to be a huge Oracle ERP applications database. Now, 50GB is common, and large companies are consolidating global data centers into ERP instances ten times larger. Constant Change The technology sector is always changing, and Oracle Corporation has been the root cause of a lot of that change. Occasionally, companies such as Oracle can introduce new products and features faster than their customers can implement them. You must stay reasonably current with new releases and upgrades to the products you license. Competitive Nature The ERP software vendors compete aggressively when governments or large companies replace legacy systems. Oracle has been at the forefront of the stampede to sell loads of software, services, and education to the Fortune 1000 companies. The competitive marketing effort to sell software can sometimes affect the technology. For example, even though Oracle now says the client/server architecture was a flawed design, its message was quite different when it was trying to beat the competition with release 10.6 of the ERP Applications. As someone who uses packaged software to run your business, you should realize that occasionally software vendors adjust their products to meet competitive pressures. You must be prepared to deal with that change. Experimental Disposition Occasionally, products and services have been marketed and promoted before they are ready to see the light of day. More than once to close a big deal, features have been added without adequate testing. Products have been announced as "in the pipeline" simply because the competition had a similar product, feature, or service. Many long-time Oracle customers have fallen for the promise of "its in the next release"some more than once. Tip If you are running a business on production software, no matter how badly you want to use the new technology, consider waiting about six months from the production release date before upgrading any Oracle software. New software is often late and, for production systems, shouldn't be considered real until it is actually shipping with production status. It will take about six months to work out the kinks and get the support staff trained. Let the implementation sites with nonproduction systems find the bugs in the new release. These rules of thumb were formulated 14 years ago when Oracle was releasing version 5.0 of the database and tools, and these rules are still appropriate today.
Discourages Customization of Its Applications Oracle has declared war on complexity and has a philosophy to discourage customization of the applications by its customers or consultants. Larry Ellison, Oracle's CEO, and Jeremy Burton, a Senior VP of Marketing, advise their customers that the software will support 80% of customer needs out of the box. Oracle management tells customers that users have to change their business to conform to the processes in the software. This concept of "you can have any color as long as it's red" is not being received well by many customers. The vast majority of customers know that Larry Ellison is not naive, but, to customers with real businesses to run, Ellison's position seems irrational. Customers cannot understand how Oracle can sell a very expensive product that doesn't produce, by its own admission, 100% customer satisfaction, and then take the position that it is unacceptable for the customer to modify the product to remove the problem. |
