EBS users will have an advantage, but move to Fusion will require careful evaluation

Enterprise Business Suite should be first choice for new Oracle customers, says Lee Geishecker

Enterprise Business Suite should be first choice for new Oracle customers, says Lee Geishecker

Users of E-Business Suite, Enterprise and Enterprise One will all have some migration challenges in moving to applications built as part of Oracle's Fusion.

Oracle has stated that the starting point for applications in Fusion will be the Oracle E-Business Suite. It will leverage its data model and reuse much of the business logic.

Although Enterprise Business Suite is the starting point, it will not be the endpoint. Oracle plans to move away from the Oracle forms/database-centric approach used in Enterprise Business Suite to a service-oriented architected set of applications in the long term. We believe that the transition to applications built as part of Fusion will be easiest for EBS customers.

Thus, new customers should choose Enterprise Business Suite if possible. However, because even Enterprise Business Suite will be significantly changed in the long term, if it does not meet their requirements, customers should evaluate Enterprise and EnterpriseOne as alternatives.

Oracle has more than 1,600 process models that are currently used to support implementation services. These will be built into products to support migration and upgrade, allowing users to compare these standard process models against the user's processes to determine the match between current implemented applications and functionality delivered by Fusion.

Accelerated upgrades were a part of the PeopleTools X technology to move data from one instance to another, and Oracle intends to use a similar approach to support users going from Enterprise and EnterpriseOne to the Fusion product. Oracle will develop maps from the 8.9 and 9.0 releases for all transactional data, and there will be some automation of most setup data.

However, some setup data will require manual intervention. There will also be new setup data that will need to configure for the new applications. If there have been customisations, the maps will show where the user has extended the basic applications, and the customer will be able to map these into the new areas of applications from Fusion or identify the need for extensions through configuration. Migration to applications from Fusion will be a substantial project, whatever the starting point.

Oracle will use the implementation workbench originally developed around Oracle HRMS to support upgrade efforts, making it easier to extend and set up. Given the investment in an accelerated upgrade approach and process maps, along with the metadata architecture of the Enterprise and EnterpriseOne products, Oracle is confident that it can build automated transfer of operational data and most configuration data for these systems.

This, however, is a notoriously tricky area, and customers will need to check Oracle's achievements rather than rely on promises.

Users are not expected to migrate all the functional or multiple instances in one step. For example, customers are saying they don't want their first implementation of applications from Fusion to be a global migration of their PeopleSoft payroll systems.

Oracle will probably guide customers to exploit the new applications from Fusion by building around current implementations and then replacing components piecemeal.

By introducing many additional Web services, creating looser interfaces between the applications, using hubs, and using the BPEL Process Manager engine, it would be possible for customers to implement a Fusion Middleware-based front-office solution or procurement solution to run on Oracle Fusion Middleware and interface that into existing systems.

Then, a customer might upgrade those instances individually when the customer feels that Oracle has proved itself enough to ultimately pursue a consolidation strategy.

Customers will need to assess carefully whether this type of approach will deliver sufficient business benefit, or whether a more radical, and thus riskier, path must be chosen.

Oracle has not decided how it will convert Enterprise Business Suite, Enterprise and EnterpriseOne licences to Fusion application licences, but Oracle's intent is to provide "like for like."

It is difficult to identify "like for like." For example, PeopleSoft E includes many "eApps" that provide HR self-service functionality. Oracle Enterprise Business Suite has a single module called HR Self-Service. We do not know at this point the modularity of Fusion applications. So, it is impossible to know if a like-for-like mapping is possible.

Because applications built as part of Fusion will be on a new platform, we believe that there will be a new licensing scheme. Once a customer wants to license a Fusion application (whether as a replacement for or an extension to current applications), we believe that this will trigger a change in licensing. We expect that Oracle will use Fusion as an opportunity to move customers to a common licensing scheme.

In addition, we expect there will be some sort of "upcharge" to move to Fusion applications as part of the move to the new licensing scheme.

The upcharge may not be explicit, but the new licence model will be designed so that Oracle gets some incremental revenue.

Today, Enterprise Business Suite, Enterprise and EnterpriseOne users have different maintenance rates. EnterpriseOne users typically pay 20% (World customers paid 16%), Enterprise customers pay 20% and Enterprise Business Suite customers pay 22%. The standard contract states that this is based on the list price, but most customers negotiate this to be based on the purchase price.

We expect the basis of maintenance for applications from Fusion to remain the same. We believe that Oracle will use the maintenance percentage it uses for Enterprise Business Suite.

To keep customers happy, we think it will provide discounts on the maintenance basis so that current customers do not have to pay higher maintenance fees - initially. Maintenance increases are usually locked in for five years.

Customers should make sure that contracts have language that protects them from significant increases at the end of that lock period (without changes, the contract would revert to the standard maintenance percentage times the list price).

Lee Geishecker is research vice-president at Gartner


What is Oracle Fusion?

Oracle Fusion Middleware is a family of products designed to enable enterprises to achieve greater agility, better decisions, and reduced costs and risk, according to Oracle.

These products include thefamily of products in Oracle Application Server 10g - Application Development Tools and J2EE Application Server; Web Services infrastructure; Enterprise Service Buses and Integration; Business Process Management and Activity Monitoring; Business Intelligence Tools; Security and Identity management; Enterprise Portals and Mobile - as well as Data Hubs and Oracle Collaboration Suite.

The Fusion Middleware allows users to fuse all of their current applications with their heterogeneous enterprises which include various packaged, legacy and vertical applications, Java, .net and the processes and people that rely on information from these systems to do business, Oracle said.

Source: Oracle

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