The Long and Windy Road to Oracle's Fusion Applications

Oracle has laid out the Fusion Apps roadmap for its customers. But how each customer actually gets to the Fusion Apps destination is another question altogether.

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The Coexistence Strategy

The term "coexistence" is not just a plea for peace among warring nations. It's an oft-used slogan employed by Oracle executives to placate Fusion Apps-wary customers who envision a big-bang, rip-and-replace scenario.

Oracle's application customers have been following their own routes via the Applications Unlimited program, which has promised customers continued enhancements on the vendor's current business applications. Oracle's application strategy, noted Kurian during an October webcast, "does not require [customers] to rip and replace their existing implementation of Applications Unlimited in order to pick up Fusion Applications."

With Fusion Apps GA now looming, decisions on whether to upgrade their core business apps will get tricky for customers.

"The question I get most is," said Miranda at OpenWorld 2010, "do I wait for Fusion, or go to EBS [E-Business Suite] 12 or PeopleSoft 9.1? Most customers will stay on their current path and upgrade to latest release." Other customers, however, will embark on the coexistence strategy, adding a new Fusion Apps module when the time is right, rather than upgrading the legacy app.

Kurian offered this example (during the webcast): "I'm going to keep financials, HR, procurement on E-Business Suite, and I'm going to pick up Fusion for supply chain management or CRM." At OpenWorld, Miranda termed it: "Upgrade, adopt and extend." The overriding strategy, of course, is to avoid unnecessary expenditures. "Customers don't want to spend twice the money on the upgrades," Miranda noted.

Paul Hamerman, VP of enterprise applications at Forrester Research, says (via e-mail) that coexistence is a "risk avoidance opportunity" for customers to avoid a large-scale software adoption projects.

"The customer can adopt some of the net new modules alongside existing products, or go deeper into the migration of core modules from the existing apps," Hamerman says. "At this stage, few customers are willing to take the Fusion plunge, but are intrigued enough to dabble in non-mission critical areas."

Oracle appears to have such low expectations for customer uptake with Fusion Apps that one has to wonder what will constitute a suitable payback for the more than five years spent developing it? Kenneth Chin, a research VP at Gartner, says (via e-mail) that while Fusion Apps is a strategic piece of Oracle's future, "Gartner does not see it having a significant impact on Oracle's revenue stream through the end of 2011."

As Fusion Applications is released to the masses in 2011, Oracle executives can point to the comprehensive roadmap that they have offered to their customers. Now it's up to those customers to chart their own paths forward.

Thomas Wailgum covers Enterprise Software, Data Management and Personal Productivity Apps for CIO.com. Follow him on Twitter @twailgum. Follow everything from CIO.com on Twitter @CIOonline. E-mail Thomas at twailgum@cio.com.

Copyright © 2011 IDG Communications, Inc.

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