More and more companies want their IT teams to focus on activities that provide the enterprise with a competitive advantage or have a visible return on investment (ROI). Utilizing services called software as service or computing on demand enables firms to redeploy key IT people and outsource key IT operations to expert providers of those services. Firms can shrink IT expenses and achieve greater efficiencies, as well as improve the scalability, reliability, and security of their IT systems. Learn how customers can utilize Oracle On Demand to obtain any solution that Oracle sells delivered to their enterprise without having to directly manage the implementation or the ongoing maintenance and operation themselves. Businesses can get Oracle Collaboration Suite On Demand, Oracle Technology On Demand, and Oracle E-Business Suite On Demand. They can get a similar solution for PeopleSoft and JD Edwards products as well because Oracle is working swiftly to align and integrate these services. According to Juergen Rottler, Oracle's executive vice president of Oracle On Demand and Oracle Support, Oracle On Demand encourages a deeper relationship with the customer, since Oracle can identify IT challenges from within the organization and match Oracle solutions to the customer's needs. Customers benefit because solutions are implemented more efficiently and quickly, and Oracle increases the revenue it earns from the channel.

As Published In February 2006

Transforming Software Management
By Aaron Lazenby

Software as a service—an integral part of Oracle Fusion

When you think about what you want your IT team to focus on, you're not likely to say "patching" or "database tuning." Managers want their IT people to focus on activities that have a demonstrable return on investment (ROI) or that provide a competitive advantage. More companies are redeploying key IT people through the use of services called computing on demand or software as a service. By outsourcing key elements of their IT operations to an expert provider of those services, businesses are achieving greater efficiencies; reducing IT expenses to a predictable monthly cost; and improving the reliability, scalability, and security of their IT systems. Juergen Rottler, Oracle's executive vice president of Oracle On Demand and Oracle Support, talked to Profit about how the concept of software as a service fits into the Oracle Project Fusion strategy.

Profit: What is Oracle On Demand?

Rottler: Customers can get any software and solution that Oracle sells delivered to their enterprise without having to directly manage the implementation or the ongoing operation and maintenance themselves. Oracle provides a complete operational solution that covers ongoing software management, planning, and rollout. In many cases, we handle the actual data center operations, IT infrastructure management, and a host of services ranging from help desk to application management, disaster recovery, and IT governance and compliance.

Customers can get Oracle Collaboration Suite On Demand, Oracle Technology On Demand, and Oracle E-Business Suite On Demand. They can get a similar solution for the PeopleSoft and JD Edwards products as well, and we are working swiftly to align and integrate these services. Retek, ProfitLogic, and i-flex all provide some degree of "on-demand" or "software-as-a-service" capabilities as well. And we are integrating all of these services into our global operational backbone and delivery infrastructure.

Oracle On Demand has software management at its core. We provide expert capabilities to manage any Oracle product, thanks to our deep connection with Oracle's development, support, and consulting teams. Our slogan—"Who better to manage Oracle than Oracle?"—holds true, thanks to the strategic focus and investment Oracle has been making for the past six years in pioneering ways to transform the industry toward a software-as-a-service model.

Profit: Tell us more about software as a service.

Rottler: Software as a service is a term that describes the next generation of software delivery and implementation, daily operation, management, and evolution where a vendor delivers these capabilities as a service to either an individual enterprise with dedicated software environments or to multiple enterprises in a shared, utility-like delivery model. These two models are often referred to as single-tenant and multitenant.

In the past, software companies typically left the ongoing operation and management of their products to an IT service provider, who would then provide various services from implementation through hosting and operation to its customers. What we learned is that customers want more. Customers want their service provider to be more closely engaged in the ongoing operation and management of their software and solution. That way they can leverage the vendor's deep understanding of the technology, a close relationship with development and support, and a keen interest in the customers' success with the solution.

An increasing number of customers also want to have service-level agreements with software providers that are built around the unique demands of their business. Customers want an IT partner with not just the tools but the expertise to help them realize benefits from a range of software solutions. Customers are not in the business of running information systems, after all; enterprise software is just an instrument that helps them achieve a greater business goal. Customers want a guide who can help them navigate the complex world of technology and help them come out on top.

Oracle On Demand has everything in place to do all of that. We have enterprise-class applications built on top of an unbreakable technology stack that can handle complex business transactions in a mission-critical environment. We have the right people and processes in place to foster a deeper relationship with our customers. We have increased the quality of our customer service. Oracle, unlike many of our competitors, has made the necessary investments during the past years to meet these customer requirements and deliver software as a service.

Crossing Boundaries John Brown of the IOUC on how user group members can make their voices heard International Oracle User Council (IOUC) Vice Chair John Brown shares his thoughts on how culture drives and divides user communities, as well as how critical it is for user group members to communicate with Oracle on strategies such as Oracle Fusion. The tendency is to put user groups into boxes, separating them by industry or by function. This does not work, because not only are the user groups diverse but they overlap in so many different ways. What this diversity provides, however, is a spectacular opportunity to get exposure to different ways of thinking, different industries, geographies, and cultures. By exposing people to different cultures, you give them the opportunity to learn how they are different. While we can't really stand in another person's shoes and see and understand what we're saying from their point of view, getting together in user groups helps us examine and modify our behavior—or at least make our behavior expressed rather than implicit. From the IOUC perspective, cultural issues are very much about how we get the conversation about something like Oracle Fusion to happen properly between Oracle and our user members. Clearly there is an enormous amount of interest in Oracle Fusion. Frankly, it doesn't matter whether you are an ex-JD Edwards customer, an ex-PeopleSoft customer, or an Oracle customer. As customers you need to evaluate this project. Oracle has forever changed as a result of the acquisition and you must decide what they are going to do for your organization as a result of that. With Oracle Fusion there is also some apprehension among the user group community. As members of the various communities, we can sit back and watch or we can get involved and influence Oracle Fusion to ensure that special piece of functionality is actually maintained or delivered in future versions. There is clearly opportunity here to have a significant influence over how this proceeds. We can learn from those who know: the business users with experience using these varying products, bringing that knowledge together into something singular, something that is truly better than the sum of the three. Take enterprise resource planning (ERP), for example. Nobody wants to go through an ERP implementation if they don't really have to. It's expensive, it's disruptive, it's time-consuming, and it takes the "eye off the ball." Members of the user community should be very keen to be involved to make sure that the Oracle offering does indeed deliver an ongoing solution for them. At the core, we can achieve a lot more by working together. We can be much more successful in our businesses by getting in touch with somebody who has already solved a specific problem. We all say 20/20 hindsight is great. Well, 20/20 hindsight as it applies to most business, technology, and people problems actually already exists somewhere. It might not be your 20/20 hindsight, but somebody has already either tried and succeeded or tried and failed. We can be infinitely more successful at business if we talk to our colleagues and learn from them, using their 20/20 hindsight to make our efforts far more effective and far more successful. John Brown is vice chairman of the International Oracle User Council and CIO of Brown Brothers Milawa Vineyard in Victoria, Australia.

Profit: Why is Oracle On Demand important to Oracle?

Rottler: This is how many customers will run their IT systems in the future. IDC found a 39 percent increase in sales of software as a service from 2003 to 2004, accounting for US$4.2 billion. The growth of Oracle On Demand over the past year reflects a similar trend. Gartner predicts that by 2010, 30 percent of new software sales will be delivered this way. Based on what we're seeing, it is clear that customers want software as a service and will increasingly ask for Oracle On Demand.

Additionally, because Oracle On Demand fosters a deeper relationship with the customer, we are able to identify IT challenges from within the organization and match Oracle solutions to the customer's needs. This not only increases the speed and efficiency of the solutions we deliver to customers, but it will increase the revenue we earn through this channel. With IDC predicting US$10 billion moving through this space by the end of the decade, Oracle should see significant growth through the successful delivery of Oracle On Demand.

Profit: How is Oracle Fusion being developed with on-demand capabilities in mind?

Rottler: With Oracle Fusion, we are moving from dealing with the deployment and management challenges of delivering software as a service to thinking of deployment and management as fundamental design criteria of our applications. Service-oriented architecture (SOA) plays a huge role in that. SOA allows customers to deploy the right capabilities at the right time as a service, and not necessarily just as a software installation. The software that comes out of Oracle Fusion enables us to deliver services—more than just software. The software is what runs the services and enables the services, but ultimately it's about being able to deploy services in an enterprise. Customers want new functionality and want to be able to seamlessly turn on new services—they will naturally interact with other functionality because they share a common data model. Customers will also be able to significantly reduce the time it takes to go live.

Also, there are benefits when you step beyond Oracle E-Business Suite. Let's say you are in the retail business and want to use Oracle's Retek and ProfitLogic features. With SOA running a variety of products, Oracle On Demand would be reasonably transparent because the services are running in the background on remote servers. In an SOA, information will flow more freely and follow standards and there will be the ability to seamlessly integrate different components even if they are not part of the same suite. That is the goal of Oracle On Demand for Oracle Fusion.

Profit: How are you working with Oracle Product Development to integrate Oracle On Demand with Oracle Fusion?

Rottler: It starts at the top. I'm a member of the Fusion Advisory Board, led by [Oracle Senior Vice President, Applications Development] John Wookey, which works with top customers to help drive the direction of Oracle Fusion. There are a lot of working bodies inside Oracle that focus on Fusion specifications and requirements. My team is tightly integrated with those, across many of the aspects of Oracle Fusion—starting with supportability and manageability considerations, through to service provisioning and monitoring, and ultimately to how we deliver functionality and enable software as a service as a deployment vehicle.

Profit: What role does the acquisition of Siebel play in this?

Rottler: Siebel On Demand was a late entry to the software-as-a-service market. They were able to learn from the experiences of others and have deployed a very competitive customer relationship management [CRM] on-demand solution.

For More Information Visit Oracle On Demand at oracle.com/ondemand

Siebel's solution has been very successful in head-to-head competition against Salesforce.com, exposing the weaknesses and limitations of that offering. We can leverage that capability to provide an even stronger offering for CRM while giving customers the option to expand their service to cover all business processes and functions through Oracle's much more complete On Demand offering. That's something the niche players, like Salesforce.com, can't deliver.

Siebel On Demand helps us deliver a complete solution to our customers. Even small companies over time are going to want to branch out. We can get them started in the areas in which they are most comfortable, and if they are successful we have a continuous growth path. With Salesforce.com, even if the customer is happy, what are they going to do next? They are going to have to work with a different vendor and invariably they are going to care about their information being able to flow together naturally. That is where Oracle has a huge advantage, because we do have a single data model across the entire set of products.