Let's Stop Paving Over Cowpaths

Rick Beers is Senior Director of Product Management for Oracle Fusion Middleware. Prior to joining Oracle, Rick held a variety of executive operational positions at Corning, Inc. and Bausch & Lomb.

With a professional background that includes senior management positions in manufacturing, supply chain and information technology, Rick brings a unique set of experiences to cover the impact that technology can have on business models, processes and organizations. Rick will be hosting the IT Leader Editorial on a regular basis.

Thinking about an ERP Upgrade? Many others are and many will have a critical decision to make. Make it carefully.

Oracle Open World is almost upon us, and if recent research by Unisphere Research is any indication there is a strong likelihood that top of mind with many customers will be a major applications upgrade. In surveys of applications managers across Quest and OAUG membership last year, Unisphere explored upgrade plans and approaches and published the findings in separate research reports. (Quest Membership Survey, OAUG Membership Survey). The research revealed that over half of respondents either have an ERP upgrade underway or have one planned within the next 24 months. I was struck by the consistency in responses across Oracle’s ERP installed base of E-Business Suite, PeopleSoft and JDEdwards, which tends to validate the findings.

There was one finding that caught my eye and that was in Figure 2 (‘Scope of Enterprise Application/ERP Upgrades‘). Here we find that 2/3 of ERP Upgrades are either Technical or purely Functional (a continuation of the existing ERP Footprint). Combined table below:

I know, it’s long been considered best practice to first perform a technical upgrade and once done, to then look more strategically at business processes and platform architectures. I know; I followed this practice back in my own enterprise IT days. During those ERP-centric days, when we all strove for a single, on premise packaged ERP system as the enterprise platform, a Technical Upgrade approach made sense. But no more; technical ERP upgrades are now traps. Consider:

  • The pace of business change and the rate of technology innovation such as Cloud Computing, Mobility and Big Data are accelerating and not naturally in sync. Anything that perpetuates the status quo without a strategic review puts us further behind the curve.
  • Upgrades normally run in 3-5 year cycles. During that time customizations and workarounds creep in and multiply as business models and processes change beyond the limits of ERP code. These simply perpetuate in technical upgrades.
  • Finally, let’s face it, most of us never get around to the strategic view following a technical upgrade; we move on to other things. We lose the transformative potential once the technical upgrade is complete. We’ve paved over cowpaths and prevented transformation.

ERP systems are still critical components of an enterprise systems platform, but they must interoperate in a managed and secure way with a variety of edge applications and services, both On Premise and in the Cloud. No single component, even one as dominant as ERP, should be considered individually. It is for this reason that we have created AppAdvantage, a unified view of Oracle Fusion Middleware, Oracle Applications and Oracle Engineered Systems.

As I described when I introduced AppAdvantage in last month’s blog, this pace layered approach to enterprise platform architecture leverages the inherent advantages that Oracle Fusion Middleware provides to Oracle’s Enterprise Applications customers by simultaneously delivering business value and by enabling their evolution towards the future state of enterprise systems: A hybrid of ERP, best of breed applications and services interoperating in real time (either On-Premise or in the Cloud) in an adaptable architecture that can flex with business requirements.

Yes, periodic ERP upgrades are still a necessity; perhaps more now than ever. But by adopting an AppAdvantage approach, Oracle’s enterprise applications customers will lower costs, deliver greater business value and agility, and begin their journey to the future state of enterprise systems.

Oracle Open World will provide many opportunities to learn more about Fusion Middleware and in particular AppAdvantage. For an overview, read Rimi Bewtra's post from last week. In particular, check out these two sessions, both on Tuesday, September 24:

CON9301: General Session: Transform the Enterprise—Optimize Applications Investment with Middleware
Tuesday, Sep 24, 12:00 pm – 1:00 pm
Moscone West - 2002/2004

Rick Hassman, Pella Corporation
Ron McCutchen, McAfee
Massoud Sedigh, World Fuel Services

CON9302: Enterprise Application Innovation: Business Impact of Oracle Fusion Middleware
Tuesday, Sep 24, 3:45 pm – 4:45 pm
Moscone West, Room 2014

Michael Beattie, Aramark Uniform Services

Aby Joy, Igloo Products Corp
Richard Beers, Oracle

For more details on this and other sessions that explore how Fusion Middleware can enhance and extend the value of Oracle Applications download Focus On Oracle AppAdvantage.

See you at Open World!


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« July 2016