Oracle: Fusion at Halfway Point

Company insists it's on track, but some analysts, customers are underwhelmed with its progress.

The massive initiative formerly known as Oracle Corp.s Project Fusion has a new name and is halfway to being completed, says President Charles Phillips, but analysts and some customers still question the necessity and value of the undertaking.

One industry analyst questioned whether Oracle can fairly claim to have reached the halfway mark in the Fusion development effort.

"Whats misleading is Charles Phillips saying theyre halfway there, because there is no way you can parse what theyre saying and come up with half. A quarter of the way there, maybe," said Joshua Greenbaum, principal of Enterprise Applications Consulting, in Berkeley, Calif. "They were very sparse on details about the applications. They said its going to be an upgrade, not a reimplementation. You are going to be reimplementing; I dont care what they say."

Phillips took the lead at Oracles Fusion event here last week to detail the technical specifications for the next-generation enterprise application suite that will tie together piles of disparate software acquired in the last two years.

What had been called Project Fusion is now called Fusion Applications because the "project" part "sounds too exploratory," Phillips said. Other essential components include Oracle Fusion Middleware and Oracle Fusion Architecture.

Oracle executives insist the company is roughly halfway to completing the project, even though it announced the plan only a year ago. In fact, Oracle is ahead of schedule, according to Phillips. "Weve got the blueprint. Weve got the data model. We believe in a single data model, single instance. Well just extend that with great functionality and strongly established middleware," said Phillips.

He pointed to four key areas as proof points of Fusions progress: Oracles existing applications are certified on Fusion Middleware; the "best of" functions are defined; Fusion Architecture is defined; and the middleware tools are ready.

"The hardest part, the requirements, have been done," said Phillips.

Oracle executives also outlined how functionality is being culled from Oracle E-Business Suite and PeopleSoft and JD Edwards suites—though it appears most of the features are coming mainly from PeopleSoft—to be written into the new Fusion Applications suite, due around 2008.

Steve Miranda, senior vice president of financial application development at Oracle, gave a rundown of the development process moving toward Fusion Applications thats being used to cull both horizontal functionality across the applications and more specific functionality used in vertical applications.

"We gathered requirements from our customers, from the field, looked at market trends and changes in technology," said Miranda. "Starting from the E-Business Suite data model, we extended that to take some key features of PeopleSoft Enterprise."

The reimplementation process means plenty of extra work for current customers, some of whom seemed underwhelmed by the entire Fusion strategy.

"Im trying to figure out why anyone would care, outside of Oracle," said William Lawson, vice president and CIO of Ametek Inc., in Paoli, Pa. "We own both JD Edwards and Oracle [products], and were doing our best to take advantage of what we have now. I dont see this as a 2006 or maybe not even a 2007 problem. My thinking is there will be a time when the next logical path forward for us will be some next version of Oracle, and the fact that its Fusion doesnt matter to me."

What Oracle still has left to do, in terms of building out Fusion Applications, is lay out a functionality road map. "They are missing functionality, process and data models that are going to go into the functional areas," said Greenbaum. "At the end of the day, I walked away saying Oracle is going to have serious trouble meeting a 2008 deadline."

While Phillips did say that Oracle will standardize on the E-Business Suite data model for Fusion Applications, Greenbaum said this was a misleading statement. "Theyre going to use the E-Business data model for a lot of things, but CRM [customer relationship management] is coming from Siebel [Systems Inc.], and with that comes a lot of verticalized data models that Siebel already developed that therefore have to be synced with whats happening in the other functional areas," said Greenbaum. Oracle agreed to acquire Siebel last year.

Based on what Oracle announced last week, it appears the company plans to use the Oracle E-Business Suite data model for Fusion Applications, build in Fusion Middleware and pull in functionality from PeopleSoft and JD Edwards, according to Gartner Inc. analyst Yvonne Genovese.

Its "pretty likely" that Oracle will succeed in delivering the Fusion Applications "because theyre basing most of what theyre doing on a current product—the E-Business Suite," said Genovese, in Stamford, Conn.

However, the results will be more than what Oracle is describing as an upgrade from one level to another, she said. "Its really a migration. Its going to change the customers business process," Genovese said. "Even E-Business Suite users will have to use new processes and a new user experience. And thats most of the cost" of an upgrade—training users on a new product, she said.

"Going to a more granular data model for the E-Business customer is pretty simple. [It just] introduces more granularity and still upgrades as one," said Oracles Miranda. "For Enterprise [users], since the new schema looks very much like what you had, the upgrade is very straightforward. Its exactly what they understand, what they know."

On the front end of the applications, Oracle will employ much of the work done by PeopleSoft usability engineers. The caveat is that the user interface will be customizable if users dont fancy the PeopleSoft UI. In terms of module functionality, Oracle is taking in requirements from customers and assuring them that there will be no loss of functionality.

"In financials, there will be lots of focus around receivables, comprehensive budgeting, travel authorization," said Miranda. "Across human resources, there will be a compensation workbench from PeopleSoft and an object management system."

Halfway there

In the middle of last year, Oracle started migrating from building applications in Oracle Forms to building in Java—the basis for Fusion Applications moving forward.

"Weve started [with] the intent of developing applications as moving to Fusion as part of current releases," said John Wookey, Oracles senior vice president of application development. "[These are] incremental capabilities that are nondisruptive to what customers are using now."

Examples of these Fusionesque capabilities, due in the middle of this year, include Fusion Reporting, which will provide libraries of reports to augment those that users already have and migrate users from the current SQR reports to Java.

An integration services repository for all the suites is in the works, and Oracle plans to publish in the next three months a Web services registry that will map back to users current applications—information that should give users a "pretty clear understanding of how to start modeling processes," said Wookey.