김 훈DirectorBusiness Development / Consulting

Oracle Korea

고객,기업,공급망의

E-Business Integration 전략

Agenda

� 기업환경의 변화

� Application market 의 흐름

� 통합된 기업정보 시스템

� 오라클 E - Business Suite 의 장점

Market Trends Drive Challenges...

ChallengesOperate and compete in a global economywith increased competition

Cope with rising customer expectations

Provide increasingly complexproducts and services

Sell and service consistently through diverse channels

Reduce Costs using the InternetImproving profitability

Information chaos

The Market is Changing

Goal:

Run Your Business as an E-Business

The Conventional Approach -- Kit Assembly

MarketingMarketing

Web StoreWeb Store

SalesSales

ServiceService

OrderOrderMgmtMgmt

FinancialsFinancials

HRHR

ManuManu--facturingfacturing

BusinessBusinessIntelligenceIntelligence

ProjectProjectManagementManagement

MarketingMarketing

Web StoreWeb Store

SalesSales

ServiceService

OrderOrderMgmtMgmt

FinancialsFinancials

HRHR

ManuManu--facturingfacturing

BusinessBusinessIntelligenceIntelligence

ProjectProjectManagementManagement

U.S.U.S.AsiaAsia MarketingMarketing

Web StoreWeb Store

SalesSales

ServiceService

OrderOrderMgmtMgmt

FinancialsFinancials

HRHR

ManuManu--facturingfacturing

BusinessBusinessIntelligenceIntelligence

ProjectProjectManagementManagement

EuropeEuropeMarketingMarketing

Web StoreWeb Store

SalesSales

ServiceService

OrderOrderMgmtMgmt

FinancialsFinancials

HRHR

ManuManu--facturingfacturing

BusinessBusinessIntelligenceIntelligence

ProjectProjectManagementManagement

Kit Complexity Worsens with Global Operations

U.S.U.S.

MarketingMarketing

Web StoreWeb Store

SalesSales

ServiceService

OrderOrderMgmtMgmt

FinancialsFinancials

HRHR

ManuManu--facturingfacturing

BusinessBusinessIntelligenceIntelligence

ProjectProjectManagementManagement

FranceFrance

MarketingMarketing

Web StoreWeb Store

SalesSales

ServiceService

OrderOrderMgmtMgmt

FinancialsFinancials

HRHR

ManuManu--facturingfacturing

BusinessBusinessIntelligenceIntelligence

ProjectProjectManagementManagement

JapanJapan

MarketingMarketing

Web StoreWeb Store

SalesSales

ServiceService

OrderOrderMgmtMgmt

FinancialsFinancials

HRHR

ManuManu--facturingfacturing

BusinessBusinessIntelligenceIntelligence

ProjectProjectManagementManagement

Kit Complexity Worsens with Global Operations

Application vendors across Technology ErasApplication vendors across Technology Eras

70-80’s 90’s 00’s

Internet Internet Client/ServerClient/ServerMainframe Mainframe

23 out-of-business

(1000’s customers damaged)

SAP R/3JDE OneWorld

Top 25apps.vendors

Top 5 vendors

SAP: trying to reinvent itselfPeopleSoft: survival modeJDE: struggling. Out of E-businessBaan: sold on May 2000

OraclePeopleSoft

Oracle E-Business SuitePeopleSoftNiche players.com’s

Few vendors survive technology eras

The Baan experience

Matrix andBeologicNov. 1997 Hyperion

April 1997Never soldoutside USA !!

BaanBaan

Functionality Functionality is not as solid asis not as solid as

Baan claimsBaan claims

1

2

Process Process manufacturingmanufacturing

FinancialFinancial

Production Production synchronization andsynchronization and

schedulingscheduling

AntalysDec. 1996

CustomersCustomersmgmt. and salesmgmt. and sales

force automation force automation

Aurum. May 1997Price: $250MBaan benef 96: $45 M

ConfiguratorConfiguratorBudgetsBudgets

Probe Software1993

Pillar

BerclainJune 1996

**

*

*

*

*

*

* : Purchase** :Joint-venture***: Venture investment

FinancialFinancialCODAFebruary 1998Price: $86.6M

*

ServicesServices

AstrumJune 1998

Sales ForceSales ForceAutomationAutomation*

HumanHumanResourcesResources

*

Meta 4Jan. 1998

Ley GmbH = Workflow. September 98 / Caps Logistics: Warehousing and Transportation. September 98

CODA SoldApril 2000Price: $31M

April 2000, Meta4 Sold, Price $ 21 M

Ed Black, Aberdeen Group, in Users Frustrated by Lack of Baan VDetails, Computerworld, May 19, 1997. Baan needed to make acquisitions to shore up holes in its products.

Gartner Group. February 23, 1998.Enterprises looking to purchase either Baan’s or Coda’s currentfinancialshould protect themselves contractually againsttechnological or functional disruptions

The Red Herring magazine. August 1998.At the strategic level, there are questions about how Baan isintegrating its recent acquisitions:

Its Antalys purchase is widely considered disappointingBaan was unsuccessful in building its own financial componentand, because its joint venture with Hyperion didn’t work out,acquired CodaThe need to rewrite all of Aurumcode has made that acquisitionmore painful than anticipated

Quotes about Baan acquisitions

Baan experience

Forced to grow or disappear, Baan tried to achieve too much at the

same time taking high risks for the company and its customers

Twelve companies Acquired / Joint Ventures since 1996:

Each product has a different architecture and technology

Ex: Baan Web toolkit? Aurum Web Track? Hyperion Spider-Man?

Baan had to re-write with BaanTools and integrate the products

Migrate the products to the supported databases and maintain them

. . . CRM companies also need to grow and extend theirfunctionality. They are much smaller than Baan and arefollowing the same path.

History repeats itself !!

Back OfficeCenter of gravitySAP : FinancialBaan: ManufacturingPeopleSoft: HRSSA: Manufacturing

DevelopmentAcquisitionsFew vendors5 years

Back Office Suite

IntegrationsCustomizations

Customer Solution

+

Front Office

Point SolutionsSiebel: SFABroadvision: E-CommerceKana: E-mailE.piphany: Marketing

DevelopmentAcquisitionsAlliancesFew vendors

Front Office Suite

Front OfficeIntegrationsFront/Back OfficeIntegrationsCustomizations

Customer SolutioneBusinessSuite

Vendor path Customer path

Only Oracle is ready with an E-Business Suite

Vendor path Customer path

Solution PathSolution Path

Business IntelligenceBusiness Intelligence

eBusinesseBusiness Platform PlatformCommon Application Architecture & SchemaCommon Application Architecture & Schema

MarketingMarketing SalesSales ServicesServices

Supply ChainSupply Chain ProcurementProcurement FinancialFinancial

ProjectsProjects SEMSEM Human ResourcesHuman Resources

Oracle Niche vendors

Point SolutionPoint Solution Point SolutionPoint Solution

Grow

. . . or the likes

What ’s going on in the Application Market

As customers recognize the power ofsystems that use information from allparts of the enterprise and automatecrossing organizational boundaries,stand-alone CRM apps. will find itharder to retain market share .

CRM apps. will be sold as part ofenterprise software suites that integrate

front and back offices rather thanindependent stand alone front-office

products .

Customer Relationship Management Software Report1998-2003. AMR, 1999

AMR Research Report on Enterprise Applications. March 2000

You cant avoid it - CRM Success Demands Frontand Back-Office Integration.

Unless companies integrate their front and backoffices,they willfail to harvest the full benefit of

CRM strategies.

Some of the most important information acustomer needs is often locked up in back-office

systems

Workflowsand information flowscross boundariesas customer-oriented process prevail.

ERP vendors are straining to deliver CRM, one ofthe CRM vendors has built or acquired back-office

functionality .

What ’s going on in the Application Market

Our Front/Back Office are now running together

I see five I m sorry,there are only three

The customer credit is exceeded It was, they just paid.You can take the order

I didn’t expect such results after all the integration effortOur customers are starting to complain about our internal segmentation

Everyone Shares Information

공통의 문제점은?

Integration!

Requisitions

Financials

Human Resources

Supply Chain

Exchanges

Marketing/Campaign Mgmt.

Sales Force Automation

Kit vs. Suite

Service

E-mail Management

Web Store

E-Business Suite

통합의 문제점

� Business requirement– Unified customer view

– Front and back office integration

– Single instance of information

� 전략적 통합의 문제– 중장기 관점의 고객의 필요성

– 통합시의 기능 저하의 문제

– Technology updates (version up & etc.)

통합의 문제점 (계속)

� Vendor Integration Issues– Alliances� 협력관계의 문제점 (예: data model ownership)

– Acquisitions� 다른 vision, 업무관행, data model 등을 통합할

때의 문제점

통합의 문제점 (계속)

� 통합의 유형과 방법– Batch vs. real-time interfaces

– Interface workflows

– Depth of integration

– Underlying architecture

– 통합의 방법

Enterprise Application Integration Defined

The coordination and synchronization ofmultiple, heterogeneous applications, within andbetween enterprises

Why integrate applications?Global, Consolidated View

Automate Business Processes

Reduce Process Latency

Enterprise Application Integration

A $40 billion problem ($60 billion in 2001).IDC (1997)

...accounts for 40% of IT budgets.Forrester Research (1997)

. messaging infrastructure will become theengine for mission-critical interpersonal andapplication communications....

Meta Group (May, 96)

ERP and CRM Integration PointsBased on the document thataccompanies the Key BusinessFlows, this table shows thenumber of integration pointsbetween CRM modules and non-CRM applications for the keybusiness flow processes thatoccur in CRM enabled businesses

3rd

Par

ty /

Oth

er /

Ext

erna

l

Acc

ount

s R

ecei

vabl

e

BoM

Cal

l Cen

ter

/ iC

ente

r

Cha

rges

Cor

e A

dmin

Fix

ed A

sset

s (E

RP

)

HR

Inst

alle

d B

ase

Inve

ntor

y

MR

P

Net

wor

kEle

men

ts

Num

ber

Reg

istra

tion

Cen

ter

Ord

er M

anag

emen

t

Oth

er in

tegr

atio

n po

ints

Pay

able

s

Pay

men

t Ser

ver

Pro

ject

(E

RP

)

Pric

ing

Eng

ine

Pur

chas

ing

Qua

lity

Rec

eivi

ng

Shi

ppin

g

WIP

TOTALCall Center 3 3Charges 2 2Collections 7 2 9Contracts 1 1Customer Intelligence 9 2 1 12Depot Repair 2 1 1 1 2 4 11Foundation 3 3iCenter 3 3iMarketing 1 1iPayment 1 2 3Marketing 1 1Mobile Field Service 1 1Network Elements 0Network Logistics 1 2 2 1 2 1 9Number Portability 4 1 4 9Number Registration Center 0Order Capture 1 5 1 2 1 1 2 3 8 24Provisioning 1 1Sales for Comms 8 1 3 3 4 19Sales Online 1 1Scheduler 1 1Service for Comms 2 2Spares Management 12 12Support 1 1 2Telesales 1 6 2 1 1 11

141

Integration Integration 비용비용

CRM PROJECTCOST DRIVERSCRM PROJECTCOST DRIVERS

DIRECTCOST DRIVERS

DIRECTCOST DRIVERS

INDIRECTCOST DRIVERS

INDIRECTCOST DRIVERS

SOFTWAREACQUISITIONSOFTWARE

ACQUISITIONINTERFACE

DEVELOPMENTINTERFACE

DEVELOPMENTIMPLEMENTATION

CONSULTANCYIMPLEMENTATION

CONSULTANCY

INTERFACEMAINTENANCE

INTERFACEMAINTENANCE

TECHNOLOGYUPGRADE

TECHNOLOGYUPGRADE

ONGOINGOPERATIONS

ONGOINGOPERATIONS

one-time costs

ongoing costs

OPPORTUNITYCOST

OPPORTUNITYCOST

PROCESSCHANGE

PROCESSCHANGE

PROJECTRISK

PROJECTRISK

CRMFUNCTIONALITY

CRMFUNCTIONALITY

VENDORMANAGEMENT

VENDORMANAGEMENT

TECHNOLOGYLEADERSHIP

TECHNOLOGYLEADERSHIP

tactical drivers

strategic drivers

초기의 직접 비용

� Software Acquisition (제품 구입 비용)

– Application license, Infrastructure platform software licenses ( operating systems, databases etc.)

� Implementation Consultancy

– 고객의 요구를 맞추기 위한 현재 업무 프로세스 분석

– Customization

– Implementation planning for installation and roll-out

– Data migration - 정제, 통합, 이관

� Interface Development

– Analysis, build and test of interfaces

진행 과정의 직접 비용

� Interface Maintenance

– Enhancement of Interface as required by users

– Upgrade of interface to comply with software and hardware upgrades

� Technology Upgrade

– Application and platform software upgrade to comply with technology upgrades

� Ongoing Operations

– Processing - standard costs and incremental costs of running interface jobs(for batch processing) and data hygiene routines

– Resource - required to support applications and infrastructure(e.g. DBA, Operation support staff)

기술적인 간접 비용

� Opportunity Cost (기회비용)– Until the system is fully operational, a number of

opportunities would be lost(or not exploited to full potential) due to sub-optimal CRM capability

� Process Change– Consultancy - design of new business process, key

performance indicators and organizational structures

– Organizational - 교육 연수 비용, 신규채용/ 조직의재정비에 따른 생산성저하

� Project Risk– The scale and complexity of the project

– 성공할 확률이 떨어짐으로 인한 사내의 지원이 약화됨

– 프로젝트중 비용/리스크가 커질 가능성이 매우 높음

전략적 간접비용

� CRM Functionality– CRM 전략에 따른 추가 비용 (예: Web store/ Call center/

On-line credit processing / Link to Fulfillment mechanism)

� Vendor Management– 한 공급자 vs. 다수의 공급자

� Technology Leadership– 선진기술의 사용을 결정하기 전에 비용/효과 분석이

선행되어야 함

Oracle E-Business Suite

Business IntelligenceBusiness IntelligenceM

arke

tin

g

EE-- BusinessBusiness PlatformPlatform

Common Application Architecture & SchemaCommon Application Architecture & Schema

Sal

es

Ser

vice

Str

ateg

ic E

nte

rpri

seS

trat

egic

En

terp

rise

Man

agem

ent

Man

agem

ent

Su

pp

ly C

hai

nS

up

ply

Ch

ain

Inte

rnet

Pro

cure

men

tIn

tern

et P

rocu

rem

ent

Fin

anci

als

Fin

anci

als

Hu

man

res

ou

rces

Hu

man

res

ou

rces

Pro

ject

sP

roje

cts

Tra

vel M

anag

emen

tT

rave

l Man

agem

ent

E-Business Suite 11iComplete and Simple

100% Internet / Architecture

100% internet

Proven scaleable thin-client solution that uses no proprietary software onthe desktop and works through httpStandard ToolsIts the platform

Component architecture

UI extensibility (plug in your own bean)Business components and APIs.

Workflow driven

Architected integration - NOT pieces stitched together

Enabling global operations -- built around features of 8.1.6 (partitioning,parallel DML, CBO) that provide high availability, reliability andscalability

Single Oracle Technology Stack

Forms BasedOracle 8 i

Architected around featureslike CBO, OPS etc.11i utilizesJserver, spatialandintermedia

Servlet /OJSP based applicationserverForms 6i Reports 6i Discoverer 3i Workflow 2.5

Servlets /Java Server Pages (JSP)

PLSQL/Java ProceduresIIOP

OCI/JDBC

SQL - RelationalExtended Object Types

Messaging API - JMS

Security - SSL

PresentationLogic

BusinessLogic

PlatformServices

Data Access

Data

Internet Platform

The New Customer ModelHallmarks

Support the B2B/B2C markets in one architecture

Introduce the concept of Party - which may be a Person,Organization , Group of Persons/Organization or a Relationship

Party concept applicable to Customers and Contacts (in future tovendors and employees)

Provide Best-of-Breed modeling capability to mirror real-worldrelationshipsbetween/amongst parties - complex, multi-tier , multi-org, matrix/hierarchical etc.

Represent current and historical relationshipsfor real customerknowledge.

Eliminate data redundancy (e.g. locations) through exemplaryschema design

Simple UI/APIs that hide underlying complexity.

Customer Model - Hierarchy

John

Chris Laura

JanetTom

One Parent Only

No Non-Hierarchical Relationships

Product 1 Product 2

John

Chris Laura

JanetTom

AnneMary

Supports Multiple Parents

Supports Non-Hierarchical Relationships

The New Customer Model - Example

Time Warner

AT & T

AT&TSolutions

AT&TLong Distance

AT&TWireless

ConAgra Hunt Wesson

Mary Smith

John Smith

Bill Jones

StrategicPartner of

Div

isio

ns

of

Employee Of (1997 onwards)

Spouse Of

ReportsTo

Em

plo

yees

of

Subsidiaryof

MattSmith

CharlieSmith

Par

ents

Of

Colorado Country Club

Member Of

BritishTelecom

Employee Of1990-1997

The New Customer Model - Benefits

-.Party Concept - Single model for all typesB2B/B2C/B2B2C ...

-.Single Source of Truth-.Realize ofCRMs founding principles

Know Thy Customer - framework for capturingcustomer knowledgeTreat Them Differently - leverage captured

knowledge for 1:1 Relationship & Personalization

-.Extensible to Single Enterprise Model -Customer, Vendors, Employees etc.

E-Business Foundation

Foundation is ...Foundation is ...

Basic application utility objectsused by all CRM apps e.g.Universal Work Queue,Interaction History, Tasks,Calendar, etc.Infrastructure that enables E-Business/CRM to beintegrateableA set of architectural base forapps

It is important because...It is important because...

provides the corelayer/glue upon which allapps are builtbuilt once and rightExcel competition - itemby item, feature for featurefacilitates applications tofocus on business processfunctionality

Consolidate Your Business Information

1 CompleteDatabase

100 FragmentedSystems

� Better information at lower cost

Customer Customer ServiceService

Call CenterCall Center

Direct SalesDirect Sales

Web StoreWeb Store

Indirect SalesIndirect SalesChannelChannel

EnterpriseEnterpriseApplicationsApplications

Self ServiceSelf ServiceApplicationsApplications

BusinessBusinessIntelligenceIntelligence

ApplicationsApplications

Supply ChainSupply ChainMgmtMgmt

ProcurementProcurement

Customer-side In-side Supply-side

Oracle E-Business Suite

Customers & PartnersMarketingSalesServiceE-mail Center

Order Management & LogisticsOrder Management for E-BusinessAdvanced Pricing & PromotionsGuided SellingStreamlined Fulfillment

SuppliersInternet ProcurementExchangesInternet Supply Chain Management

Customer and Supplier E-Business

Oracle Exchange Platform & e-Hub

An open collaborative B2B exchange

OMB

XML

Gateway

Portal

ExchangeMarketplace

ProductDevelopment

Exchange

ProjectsExchange

LogisticsExchange

Supply ChainExchange

Oracle 8iOracle iASOracle Workflow

Intelligence

Self-service user

Professional user

Adapters (fornon-Oracle ERPintegration)

Oracle ERP

Software CDSoftware CD

Conventional Conventional ImplementationImplementation

HostedHosted

BusinessBusiness OnLineOnLine

Internet ServicesInternet Services

SalesOnlineSalesOnline.Oracle.com.Oracle.comOracleExchangeOracleExchange.com.com

Identical Software CodeIdentical Software CodeIdentical Software Code

Software Delivery: More Options

질문 / 요청 사항

� Public internet 을 이용하여 Demo 가 가능합니까?

� 여러 채널로 (Web, 전화, e-mail, mobile 등routing)주문을 받으면서 동시에

– ATP, pricing 알려주고

– 선적 준비를 시키며,

– 자재를 발주하며,

– 해당 마케팅 campaign의 예산대비 실적과 ROI 를update 하고,

– 고객의 충족되지 않은 서비스 요청사항을 확인하며,

– 대리점 혹은 영업사원의 커미션을 계산하며,

– 해당영업사원의 실적과 성과분석을 update 할 수있습니까?

E-Business Suite 11iComplete and Simple

Source: Dream Societyby Rolf Jensen

수렵 /채취사회수렵 /채취사회

농경 사회농경 사회

산업사회산업사회

정보사회정보사회

Dream society -꿈과 감성을 파는

사회

Dream society -꿈과 감성을 파는

사회

생산성

복잡성

기업문화와 기업정보 시스템

Source: Dream Society by Rolf Jensen

기업문화와 CRM

마케팅 전문가들은

소비자들이 먼저 감성으로 사고

나중에 이성으로 합리화 한다고

말한다.