by Alan Joch, February 2014
Like a water glass that’s half empty or half full, the forces reshaping enterprises today may be seen as disruptive or transformative. But one thing isn’t open to interpretation—the impact of cloud computing, mobility, social networking, and data analytics are too powerful to ignore.
Transformation requires more than adopting the latest innovations, however: managers must preserve the existing IT core while identifying ways to enhance it with cloud and other new solutions.
“You can’t look just at the technology you want to harmonize and rationalize,” says Michael A. Farber, an executive vice president at Booz Allen Hamilton, a technology and management consulting firm. “You also must evaluate your business processes and consider how the digital enterprise changes the roles, responsibilities, and skills required by your workforce.”
For more than a decade, Oracle’s staff has been transforming the company’s core technology and business processes using a mix of solutions developed in-house or obtained through acquisitions of leading IT companies. From this foundation they are taking the next transformative steps with the latest cloud and on-premises applications.
It starts with a vision from the top—to implement new ideas, you must have a culture that accommodates risk-taking.
And over the years, they’ve created a formula for success. “It starts with a vision from the top— to implement new ideas, you must have a culture that accommodates risk-taking,” says Douglas Kehring, senior vice president, corporate development and strategic planning, at Oracle. “And then every person within the company must become a catalyst for change. Whether it’s in finance, marketing, customer service, or HR, we continuously push ourselves to find new ways to simplify, standardize, centralize, and automate our systems.”
Oracle’s financial operations have been on the forefront of change for more than a decade, starting when managers centralized the core Oracle E-Business Suite into a single enterprisewide resource and reduced data centers from 40 to 2 facilities. The payoff has been swift, says Ivgen Guner, senior vice president of global business finance at Oracle. Beginning in 2005, these efforts have saved the equivalent of 10 percent of revenues each year as Oracle grew from a US$12 billion to a US$37 billion company. The savings came partly because centralization and standardization meant that the support and administrative staff grew at much smaller rates than revenues, Guner says.
Oracle invests a significant portion of those savings into research and development (R&D) to grow the top line (US$4.5 billion non-GAAP in 2013). These dollars fund the innovative products and services that customers depend on—and that Oracle deploys internally to optimize operations.
For example, Oracle was able to lower the percentage of revenue spent on IT from 3.1 percent in 2006 to 1.6 percent in 2010, even as headcount and revenue nearly tripled during the same period. It’s a virtuous cycle that keeps Oracle an industry leader. “The amount we devote to R&D is a big part of what makes Oracle Oracle,” notes Guner.
Oracle’s finance executives capitalized on these improvements by implementing Oracle Enterprise Performance Management (Oracle EPM) applications, which include Oracle Hyperion Planning and Oracle Essbase analytical modeling software. Combined with Oracle Business Intelligence Enterprise Edition, the resources create a central storehouse of data that serves up performance alerts, ad hoc analyses, and dashboards for financial planners and line-of-business executives across Oracle. “I see my numbers at every moment of the day,” Guner says. “We can manage the close of a financial period much more easily because I know exactly what’s happening at any time.”
This analysis allows Guner’s team to drill into details like current profit margins for each Oracle business unit, or whether additional salespeople may be needed to support a particular solution.
The adoption of Oracle Fusion Accounting Hub yields additional benefits by creating a global chart of accounts, eliminating more than 90 redundant ledgers. Oracle personnel now submit primary ledgers running in Oracle E-Business Suite directly to the accounting hub and can submit ledgers incrementally. Oracle Fusion Accounting Hub served as an integration platform providing daily operational reporting as well as greater visibility into period-end results. This also helps with planning, making analyses in Oracle EPM. Eventually, Oracle executives expect to manage the organization even more closely as every transaction in every country originates from this global resource.
Number of human capital management systems operating at Oracle, after the consolidation of 70 systems
Rounding out the analytical capabilities is Oracle Endeca Information Discovery, a solution for free-form queries across all information sources. “This tool gives our people access to much richer information—both structured and unstructured—to ask more-incisive questions,” Kehring says.
Access to such technology can help CFOs and their teams become more strategic partners to the business, adds Guner. “Using sophisticated data analysis tools like Oracle Hyperion to analyze very granular data about the business opens up exciting new opportunities for finance to help the business succeed in ways that weren’t previously possible.”
On the frontlines of Oracle’s internal transformation are members of Oracle Application Labs, the group charged with identifying and implementing new technology within the company. “Our charter is to execute on Oracle’s vision of achieving simplified IT through innovation,” says Paolo Juvara, group vice president at Oracle.
The internal process for prioritizing which opportunities or challenges to address starts with Oracle line-of-business leaders, he says. For example, when some managers wanted to accelerate sales cycles, they worked with Oracle Application Labs to implement technologies and redesign business processes to meet this goal. The cross-departmental effort included marketing personnel, who noticed that it sometimes took four days for a potential sales lead to move from marketing to the right salesperson. Today, in some cases it takes four hours or less, with the help of Oracle Eloqua Marketing Cloud Service, the marketing system of record for Oracle’s cloud-based products.
The Oracle Eloqua system monitors what Juvara calls the “digital body language” of each prospect across multiple channels. For example, staff sees how often a person visits Oracle’s website and which pages he or she views. Marketers analyze this data to gauge a prospect’s maturity. “We want to shift from generating high volumes of leads to dramatically increasing the quality of each lead,” Juvara says. “This means our sales organization spends more time with qualified prospects.”
Oracle staff chose to integrate the Oracle Eloqua solutions with Oracle Fusion Customer Relationship Management (Oracle Fusion CRM), Oracle’s CRM platform, to forge even closer collaboration among sales and marketing. Now, after sales connects with a prospect, a team member reports back to the marketing department with updates that help refine subsequent marketing messages. “Communications are based much more on a knowledge of each prospect’s unique interests compared to the past when we often pushed similar messages to everybody,” Juvara says.
Improving customer experience (CX) is a top priority of senior executives throughout the industry. But managers at Oracle understand that satisfying sophisticated customers requires the ability to deliver consistent communications across the web, social networks, e-mail, and live events. “Our CX strategy hinges on establishing connection points between our technologies so it’s easier for our customers to engage with us,” says Melissa Boxer, vice president of CRM product management and product strategy at Oracle. “CX is about silo busting—bringing those activities together from a technology and a process perspective.”
Oracle’s internal CX efforts rely on Oracle Social Cloud for social relationship management (SRM). It includes modules for monitoring conversations, engaging with customers, creating and publishing information to social networks, and analyzing outcomes. Staff integrated the SRM solution with Oracle Eloqua Marketing Cloud Service so any new data captured through social campaigns would automatically update customer’s marketing profiles.
Boxer stresses that managers must define their CX goals based on factors important to their particular customers. “That involves bringing together many different departments to determine the results you want to achieve and the experiences you want to deliver to fulfill customers,” she says.
To define these goals, Oracle staff used journey mapping, a methodology that documents how a customer moves from recognizing a need and researching potential vendors and products to completing a purchase and implementing a solution. Many groups within Oracle, including the development staff, now use journey mapping to understand customer needs and what technologies will be required to address them.
Field marketing personnel even use the technique to design live events. At Oracle OpenWorld 2013, select attendees agreed to map their journey to San Francisco, California: why they chose Oracle OpenWorld, decisions about transportation and accommodations, and how they selected conference sessions. They identified a particular part of the journey that was important to them and shared potential improvements with Oracle staff.
For example, for Oracle OpenWorld 2014, organizers will solicit more input about content from potential attendees during the planning process. Other insights: streamline registration and offer more food service options in the main convention center. “We catch ideas like these in traditional customer surveys, but journey mapping goes deeper,” says David Curran, vice president, customer experience strategy, at Oracle. “We understand what actually drove those reactions so we can design better in the future.”
Continuous process evolution remains a top priority for Oracle executives as a way to keep the company ahead of the
With a deep understanding of target customers, managers can then select the right solutions to support their goals. “Process expertise, with methods such as journey mapping, is essential for enabling customer experience,” says Steve Miranda, executive vice president of applications product development at Oracle. “Success comes through people and processes, and then using technology as an enabler.”
What’s the best way to find top talent in an age of transformation? Job boards are passé as human resources professionals turn to social media and employee referrals to track down new talent. To refine recruitment and talent development processes, Oracle’s internal HR staff is rolling out Oracle Taleo Recruiting Cloud Service and Oracle Taleo Learn Cloud Service.
More than a decade ago, Joyce Westerdahl, senior vice president of human resources at Oracle, led the consolidation from 70 human capital management (HCM) systems into a single resource that serves Oracle’s global operations. The consolidation reduced costs and created a central storehouse for personnel data—giving executives accurate and timely information for making decisions about talent.
Westerdahl says her department taps into global data for reporting on headcount, attrition rates, and what each individual’s role is in the company, as well as that individual’s skills and achievements. And this has an impact on the entire business.
“If your HR data is an accurate single source of truth, you have a fundamental core of information that can feed other areas, such as project accounting, expenses, and purchasing,” adds Westerdahl.
The cloud-based solutions arriving in 2014 will expand these capabilities. For example, Oracle Taleo Learn Cloud Service will help managers create employee portal-based learning plans to guide skill development and ensure Oracle’s compliance requirements are met.
Supporting these tools are Oracle Fusion Talent Review and Succession Management, which Oracle’s HR department implemented in 2013 to assess talent and analyze related organizational trends. It dovetails with capabilities in Oracle Human Resources Analytics to give detailed information about talent across the organization.
“Senior leaders say they are now having conversations with their people that are more in-depth than ever before,” Westerdahl says. “The more we know about their capabilities, their aspirations, and their potential, the more-informed decisions we can make. We can build and retain a smarter workforce by tapping hidden potential.”
Indeed, continuous process evolution remains a top priority for Oracle executives as a way to keep the company ahead of the industry. “That’s why our engineering team runs our IT operations,” Kehring says. “We want to continue to be a leader as new innovations arise.”
Alan Joch is a New England–based technology writer.