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David BaumJeff Bell

David Baum spoke with Jeff Bell about the benefits of deploying Oracle Exadata and Oracle Exalogic Elastic Cloud. Bell serves as CIO of PHH, a leading provider of outsourced mortgage solutions and fleet management services to corporations and government agencies throughout North America.

CIO Central: What led you to deploy Oracle Exadata and Exalogic systems?

Bell: Working with Oracle, we have devised a compelling business case for retiring legacy, best-of-breed systems and moving to centralized, standardized ones. In the main this involves consolidating our two disparate business units into a shared services environment called the Common Technology Platform. Exadata and Exalogic will be the cornerstone of this new platform as we deploy a wide variety of technologies and applications.

CIO Central: What is the primary data-processing workload that you will be offloading to Exalogic and Exadata?

Bell: Both of our lines of business have intense, high-volume data processing needs. The PHH Arval division, which handles our fleet management line of business, has about half a million vehicles on the road. The information systems in this division are responsible for the performance, activities and status of all vehicles and drivers. The PHH Mortgage division provides mortgage solutions to some of the largest financial institutions, real estate companies, credit unions, corporations and government agencies in the U.S. In 2010 alone, we closed nearly $49 billion in mortgage financing for more than 205,000 homes, with adherence to increasingly stringent documentation and auditing procedures.

Our Common Technology Platform will permit us to bring these two businesses together to permit centralized management of our data and middleware environments. Spending time and money to integrate disparate technologies is not cost-efficient. Thus our transformation strategy centers around consolidation and elimination.

CIO Central: How did you build a business case for this strategic project?

Bell: With process-heavy businesses like fleet and mortgage services, technology is a key element of fulfilling our growth objectives. We are serious about scaling rapidly, and we can’t do that without a significant investment in our information systems. Fortunately we have a very tech-savvy board of directors and CEO, who have created rapid growth strategies in the past. On both an operations and a cost-per-transaction basis, they realized that an investment in this Oracle platform made sense.

CIO Central: How did Oracle help you to make your business case?

Bell: The Oracle Enterprise Architecture group took the time to understand our real business goals—to comprehend what our board of directors was looking for—and then helped me define that business case at several levels. They demonstrated how moving to the Exadata/Exalogic platform would help us consolidate our infrastructure to host a wide variety of applications in a more cohesive way. Having databases, infrastructure and applications in the same place will greatly simplify our data center topology and hardware footprint. The new platform will also allow for standards-based integration between different application tiers so we can begin to migrate towards a single set of standards throughout the organization. This will allow us to focus more on adding value to the business and less on administration, translation and integration.

It’s a common dilemma that every CIO can relate to: I want to scale our technology and improve our resources for our customers, yet I have to hold steady on my operating expenses and headcount. I believe we will be able to achieve these goals with the new systems we are deploying.

CIO Central: What types OpEx savings do you foresee once Oracle Exadata and Exalogic are fully deployed?

Bell: Cost-per-transaction is an important metric for us. As we scale with the Oracle solution, this ratio will steadily improve. We also foresee reduced operating expenses due to consolidation (fewer licenses, less equipment, simpler administration), along with productivity gains across out Sales Fulfillment and Servicing Units plans—not just in IT, but for people in operations and sales as well. We are partnering with Oracle to deploy several types of business applications. Each time we roll out a new system—whether it’s finance or HR or business intelligence—we will see a savings because of the core platform.

CIO Central: What other benefits do you foresee? How will you measure success?

Dia: We expect to be more nimble overall. The benefits are numerous: reduced maintenance and change costs, freeing up resources for strategic initiatives, migrating away from mainframe MIPS and COBOL expertise, greater data consistency by creating a single system of record, and the ability to leverage a global governance process for managing demand and development of new services, to name a few.

Selecting Exalogic and Exadata was core not only to our IT strategy, but also to our business strategy as we work to service more customers more effectively and lead the industry in new capabilities. This new architecture allows us to focus more on our customers and products and less on administration and firefighting. That was a compelling part of our business case with our senior managers and with our board of directors. Our big measure of success will be seen in speed of operations and successful growth. We want to grow and get faster at the same time.

CIO Central: Will these new systems position you to compete more effectively in the mortgage industry?

Bell: Absolutely. If you look at the public records, PHH has already grown during one of the industry’s most difficult times. A lot of that growth is because of our business model and the clients that we serve. We haven’t had the challenges that our competitors have had so we have been able to focus on enhancing our technology platform to position us for the next wave. We will be able to scale rapidly because of the investments that we are making right now. In the mortgage industry, the surges come out of nowhere and you need to be able to ramp up very quickly.

CIO Central: How will deploying Exadata and Exalogic systems in tandem help you achieve your IT goals?

Bell: Rolling these pre-engineered systems out in tandem as the cornerstone of a private cloud will allow us to focus on new features and applications, rather than on cobbling together a high availability infrastructure. We will end up with a database grid, an application grid, and a storage grid, all of which can scale horizontally and deliver utility-like services to the business. And yet we’re not the ones who have to assemble all the components. Oracle has done the real work of pre-integrating and linking everything together. This new architecture gives us a lot of flexibility without a lot of effort, with extreme performance and scalability across all three of these tiers.