I was vaguely reminded of this series of events yesterday, when IDC released the results of a survey it conducted at its recent AppSourcing Forum. IDC surveyed a panel of 30 corporate decision makers regarding barriers to adoption of an ASP model for their enterprise applications. While 30 is a small sample size (statistically insignificant and not projectable according to IDC), one stat stuck out like a sore thumb: 79% of respondents said allowing for customization and integration is the most important thing ASPs can do to win their business.
Knowing what I knew, which admittedly was little, about Ellison's war on complexity, my initial thoughts were that this is not good news for Oracle or its customers. If Oracle is insisting on taking its customers down a path that they don't want to go (a trend that anecdotal research like IDC's corroborates), then everyone from IT managers to investors on Wall Street should be reconsidering their investment in Oracle.
Fear, uncertainty and doubt rear their ugly heads
There is some truth to the fear, uncertainty, and doubt that emerged from Oracle's recent declarations and technology problems. According to an Oracle spokesperson, Oracle's war on complexity is indeed a message about favoring out-of-the-box tools over customized solutions. But, based on what I learned next, I'm wondering whether that message has largely been taken way out of context.
If you've read the reports and stories as I have, it's easy to be left with the impression that Oracle doesn't want customers customizing any of its solutions. If that was the case, then I'd be the first one to say run, and run fast. But that impression couldn't be farther from the truth.
Lost in much of the uproar was a seemingly minor detail that really isn't minor at all. Ellison isn't just asking technology decision makers to change the way they think about technology. He's asking them to change the way they think about business. In particular, Ellison's proposition is that ERP and CRM are core business applications that are, for the most part, oblivious to the competitive landscape. Spending precious resources, especially during difficult times, making customizations that don't add up to significant competitive advantage is a waste of those resources.
Additionally, there may be unforeseen customization costs that show up only when something gets upgraded. Based on Oracle's experience, heavily custom tailored and integrated solutions invariably break when one of the integrated components gets upgraded. Several IT managers I spoke to agreed that upgrading anything that's integrated with something else can result in unanticipated expenses. This is a large part of the complexity that Ellison has declared war on.
Ellison isn't saying "don't customize." He's just saying don't customize where you need it least. By making your business conform to the software, instead of making the software conform to the business, you'll reap significant savings in the long run (everything from IT staff to training to maintenance and consulting fees) and the savings can be diverted to the customization of technologies that will make a big difference in your competitive advantage.
He may have point. A long time ago, in my former life as an IT manager, my team committed a significant amount of resources customizing the integration of dBase, WordPerfect, and Lotus 1-2-3. To make life easier for end users, we tried to automate as much of that integration as possible. These customizations were also tailor-made to meet specific departmental needs. But we still had to train the end users and anytime one of the products was upgraded, we had to fix a lot of macros and code, and retrain users in some cases.
Eventually, the individual applications gave way to the desktop suite. Without customization, the desktop suites never matched the prowess of the previous brew we had concocted, but the end users learned to work within the limitations and got along just fine. The long term total cost of ownership of the technology was greatly reduced because the business learned to conform to the software. The users may have accepted the compromise grudgingly, but before long it was business as usual except for one thing: an improvement to the bottom line. Less training. Less programming. Less headaches. Less long-term maintenance (outside of routine upgrades).
Granted, desktop productivity suites are small potatoes compared with big iron apps like ERP and CRM, but if the stakes are higher, the potential for savings can be, too.
Customization: The "necessary evil"
In terms of generating competitive advantage, Scott Clawson, Oracle's director of marketing for Oracle 9i, sees customization as a "necessary evil." According to Clawson, "the reality is that successfully connecting your systems to those of your customers and suppliers is where competitive advantage can be had. But, unfortunately, you have little or no control over what they do. This is where customization and integration is required and where [the aforementioned savings can be applied]."
For that part of the process, Clawson contends that Oracle offers a rich set of products that support standard middleware protocols like SOAP and XML that are cornerstones of Web services.
In my conversations with Clawson, I openly wondered whether terms like "necessary evil," "war on complexity," and "support of integration standards" really mean "you can customize and integrate it, but we'd rather you didn't." Which would be the antithesis to my perception of IBM's WebSphere strategy, which is all about integration and how it can be made easier, virtually pushing customers in that direction (maybe that's because it's the only way to keep all those revenue generating mainframes from becoming obsolete).
In response, Clawson acknowledged IBM's emphasis on integration and admitted that Oracle is behind, but catching up, saying that "WebSphere gives you wizards that allow you to take applications and expose them as Web services. We'll offer the same functionality when JDeveloper 9i, part of the 9i developer's suite, ships at the end of the year. Right now, the beta version can be downloaded from our site. By the time it ships, it will allow developers to take Java applications--servlets, JSP, or EJBs--and expose those as Web services. Likewise, developers can access a Web service from a Java application."
In the battle for mind share on the Web services front, where customization and integration are the name of the game, IBM's Websphere, Microsoft's .NET, and BEA's WebLogic seem to be getting the most traction. Sun, which long touted the network as the computer, has failed to do a good job communicating its ONE Web services strategy even though remote procedure calls (fundamentally what Web services are) have been a part of that company's DNA since the beginning of time.
Oracle, on the other hand, inadvertently shot itself in the foot. It's declaration of war on complexity took on a life of its own, creating the perception that customization isn't what Oracle is about and drowning Ellison's bigger, more important message that there's a better, more practical way to run your business. It's something you should consider. Any IT manager that's been around the block a few times knows exactly what Ellison is talking about.
It always helps to read the fine print. You never know what you'll find.
What do you think? Is Larry full of it, or is he really on to something? Share your thoughts with your fellow readers at ZDNet TechUpdate's Talkback, or write directly to david.berlind@cnet.com.
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