Oracle sets restructuring example for its users

Oracle is about halfway through a massive restructuring project that promises to centralise and streamline its operations and move about 2,000 employees from data-center management to customer support.

Customers are keeping a close eye on the company, viewing it as an example of how to make a transition to the Internet-based economy using Oracle products.

At the Oracle Applications Users Group (OAUG) conference here last week, an Oracle executive said the company is about halfway to its goal of reducing 2,500 information technology staff members to just 500, redeploying the freed-up employees to customer support and reducing the number of data centres and independent sales teams.

Cutting Costs and Complexity

Oracle President Ray Lane said that as a result, the company has achieved a $200 million savings so far in operating costs.

"When you have multiple data centres, you're spending a lot of money," said Ron Wohl, Oracle's executive vice president for applications development, adding that the complexity of the original system also slowed down the corporation. "How do you optimise a deployment of personnel if your HR skill information is fragmented across 30 or 40 different instances?"

"I like to see them applying the product to their own organisation [and] cutting out the mundane parts," said Mark Adam, a consultant at Minneapolis-based Orion Consulting who just finished installing Oracle's new HR Payroll application for a client.

The goal, Wohl told the OAUG, is to move to a self-service, fully automated approach in which all the details of Oracle's relationships with its customers are tracked.

Integrating Operations

Although the full eBusinessSuite that Oracle is deploying in-house won't ship until the end of this month, some Oracle customers have already begun integrating their operations, using early release versions of the software, earlier versions or a combination of the two.

For example, 20 customers are using the hosted version of eBusinessSuite 11i, Wohl said.

"The Oracle eBusinessSuite allowed us to focus on internal and external strategies simultaneously," said Drew Harris, information systems director at Cambridge, Massachusetts-based Nantucket Allserve Inc., which makes Nantucket Nectars juices.

The company went live with Version 11.03 on March 1 and plans to migrate to 11i in September.

"Our staff had been struggling with 600,000 cases [of juice] a month," Harris said. "Now, with the same staff, we could double or triple that - we don't know what the limit will be."

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