Oracle Consulting Asia

Ask the Oracle

Oracle is the world's No. 2 business software company, and a leading provider of databases and programs for web development, enterprise performance assessment, supply chain, customer relationship and HR management. While Oracle is still known for its database dominance, it also boasts industry-leading applications software and a services division, offering a range of tech consulting services in the areas of middleware (products that link applications), business intelligence, collaboration and, of course, databases.

The firm's business is split between software and services, with the former making up 80 percent of the firm's total revenue. Consulting makes up the bulk of services revenue (other services include on-demand and education), which in total brought in US$4.59 billion for the fiscal year ending May 2008.

In 2008, Oracle reported that it was experiencing record growth in the Asia Pacific region including Japan, bringing in around US$3.2 billion in overall group revenue during the fiscal year, up 26 percent from the previous year. Revenue in the Europe, Middle East and Africa (EMEA) region also grew by 32 percent, reaching US$7.9 billion. The year 2008 also marked the first time employees in Asia Pacific outnumbered those in the Americas for Oracle, at the end of the fiscal year, the firm employed 34,515 people in Asia Pacific, compared with 32,608 in the Americas.

Doin' what comes naturally

Oracle's services division came about as a natural outgrowth of its original software business.  In 1992, former Booz Allen Hamilton consultant Raymond Lane was brought on to revamp the sales force, dividing 10,000 salespeople into two teams, one to sell database software and another to sell applications.  Lane kept an eye on sales operations while now-CEO Larry Ellison ran the applications side of the business.  By 1994, Oracle's consulting services were pulling in 20 percent of annual sales, and the company spearheaded a shift across the business world from the old model of storing corporate data on a mainframe to the new model of businesses contracting their data storage needs to a server company such as Oracle (the client/server model). The company also released its Oracle 7.1 database that year, which large corporations soon favored for their "data warehousing" needs.

By the late 1990s, revenue from applications began to slip during the tech industry slowdown.  Revenue from the services side of the business, however, had tripled from 1996 to 2000, during Lane's tenure as president and chief operating officer.  In 2000, Lane resigned and the firm named Kenneth Block as executive VP of sales and consulting in North America.  Block, also a former Booz Allen consultant, had been with Oracle since 1986.

A cavalcade of clients

Oracle consultants call on big customers in the global corporate world (including Toyota, LG Electronics, Wal-Mart and Facebook), as well as those in the public sector (including Beijing MTR, New Zealand Inland Revenue and NATO). Industries served by the firm include aerospace and defense, automotive, chemicals, communications, consumer products, education and research, energy, engineering and construction, financial services, health care, high tech, homeland security, industrial manufacturing, life sciences, professional services, public sector, retail, travel and transportation, and utilities.

Oracle's services division is closely aligned with the products it sells. Since the firm often sells its services alongside its software and applications packages, implementing these services after software licenses are purchased, the firm's consulting revenue tends to trail software revenue by several quarters. In addition, Oracle's combination of software dominance and its services business means it often cozies up to firms with which it also vies for contracts. For instance, the firm enjoys strong collaborative relationships with companies like Accenture, EDS, IBM and Unisys, companies that Oracle readily admits to being both partners and competitors.

Unlike tech services rivals such as IBM and HP, which have at least nominally tried to separate their services from the products the companies themselves produce, Oracle isn't shy about promoting and installing its own solutions as part of the consulting package. While many IT service providers are happy to encourage clients to outsource their services to them, Oracle makes its living selling its applications to customers so that they don't need to outsource.

Oracle utilizes the same holistic approach in delivering its services to companies in the Asia Pacific region. Throughout 2007, the company branched out aggressively, particularly in the Greater China region, where some 250 companies decided to choose Oracle's services. From midsized Hong Kong firms to corporate giants such as China Netcom and Shanghai Electric, clients have been receptive to forming partnerships with Oracle. The company has spent US$20 billion for acquisitions in the past few years to boost its scope and image in emerging markets where businesses are looking for an established software services provider.

New offices, new regions

Oracle has increased its focus in Asia Pacific, an area that now brings in more than US$2 billion in revenue annually for the firm.  By 2007, the firm had more than 6,000 applications customers across the region, almost half of which are small- and medium-sized enterprises.  In July 2007, Oracle announced new initiatives in China, a key area of expansion for the firm.  Goals included establishing new offices, investing heavily in research and development and technical support facilities, partnering with government ministries to support development plans, and launching new software solutions and education programs to build competitive businesses and a skilled workforce. 

The plans in China were immediately implemented, as that same month, Oracle announced two new locations in the country: the second Oracle Partner Solution Center in China, located in Beijing, which will coordinate with the firm's original partner solution center in Shenzhen, and a new research and development center in Shanghai, to focus on ubiquitous computing and Web 2.0 technologies for organizations across industries.  Oracle has existing Asia Pacific-based R&D centers in Beijing, Gurgaon, Seoul, Shenzhen, Singapore and Tokyo.  In June 2006, the firm also established a global support center in Dalian, China, to serve as a multilingual help desk providing assistance to clients in mainland China, Taiwan and Korea. 

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Oracle Consulting Asia


500 Oracle Parkway
Redwood Shores, CA 94065
Phone: +1-650-506-7000
www.oracle.com/us/products/consulting

STATS


  • Employer Type: Public
  • Stock Symbol: ORCL
  • Stock Exchange: NASDAQ
  • CEO: Larry Ellison
  • 2009 Employees: 86,000

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