Oracle Corporation Essay

The Central Intelligence Agency had commissi aned the see to it to build a commercial database management scheme for IBM mainframe computers and code-named it plentyary. package Development Laboratories took the seer name in 1982. After completion of the project, Ellison, Miner, Oates, and Scott had a vision of developing and distri buting their database parcel as a profitable stage business opportunity.From 1982 to 1986, prophesier had achieved 100% growth. On March 15th, 1986, oracle went public, one mean solar day after Microsofts initial public offering. From 1986 to 1989, revenues skyrocketed from $55 million to $584 million, fashioning it one of the largest independent software companies in the world, employing over 4,000 people in 24 countries. The Oracle Corporations objective of becoming a profitable database software conjunction had been achieved. Market and industry growth restrain until the third quarter of 1990. Oracle suffered a $15 million buck loss on $ 240 million in revenues.Between 1988 and 1991, operating margins had plummeted from 23 to 3 percentage. During this time, the clubs stock value also fell. Oracle responded by letting go of 400 employees in the United States and reorganizing its aged(a) management team. This business line of work was the direct result of just aboutthing the company patently overlooked. As the company was focusing whole of its energies on growth during the fresh 1980s, they were losing sight of their internal operations and infrastructure. They also planned their expenses establish on the 100% annual growth rate they experienced in the former years, causing them to lose money.In addition, they delayed the deli really of their latest product, which allowed the opposition to draw closer to them. However, the release of their coterminous product would see Oracle quickly rebound and turn things back around. In July of 1991, Oracle was operative on a bran-new database software that had the abi lity to manage text, video, audio, and some other data through a set of loosely connected servers.This database software was called Oracle 7, and was one of many IT ascendants that would put Oracle ahead of the rival and save the company. 996 saw database sales grow by 20 percent and then to 10 percent in 1997, the year Microsoft released its rival SQL server, which was a cheaper alternative database release with aspirations of stealing Oracles mart share. During this time, Oracle blasted to expand beyond databases and entered into the 2 largest application software markets, endeavour resource planning and client relationship management. Ellison saw this as a lucrative business opportunity, considering the fact that the ERP market was estimated at $20 trillion in 1999 and projected to exceed $65 billion by 2003.The CRM market was estimated at $4 billion in 1999 and projected to exceed $16 billion by 2003. Ellison recognized that CEOs wanted to run into profitability per costu mer and to be able to detect dissatisfaction before the customer leaves. He realized that ERP and CRM software would allow CEOs to do that by turning database data into kat onceledge about consumers. Ellisons vision of internet-enabled software began to take shape in 1999 with the release of Oracle8i. It was followed by internet-enabled versions of all the companys key software products.A key IS solution in the development of Oracle Corporation would be Oracle e-Business Suite, which would imply a collection of ERP and CRM applications that automated many necessary business functions. This would be the beginning of the high impact IS solutions to follow. In June of 1999, Ellison declared that Oracle would attempt to save $1billion dollars by the end of 2000 by transforming into an e-business. Ellison then eliminated all non-e-business options from the company. This plain move was an incredible success and a brilliant IS solution to some of the companys business bothers.The chan ges were easy and smooth to implement. An example habituated in the case was that of an expense report. In the past, a sales rep would fill out an expense report and manually send it to headquarters. today the sales rep just completes the forms on the web where the report back end be tracked. Not only did this create $6 million dollars in direct savings, the reports were easier and faster to complete. This solution did not only benefit employees, but customers, too. In the past if a customer wanted to present Oracles software, a sales rep had to set an appointment to do the demo in person.Now, the sales rep can gain vex to the customers browser and, over the phone, can do the demo over the browser at Oracle. com. The shift to self-service was a very necessary and profitable solution for Oracle. They began saving millions of dollars and hours of time. Another business problem Oracle had was a lack of centralisation in the business. One expert way they did this was by changing incentives for rude managers. Country managers incentives were originally based on revenue. This was to be changed to shift their incentives to be based on margin.In the past, 97 e-mail servers existed with almost 120 databases in over 50 countries. This was dramatically reduced when Oracle gave each country CEO a choice. They could receive free e-mail through redwood Shores or pay to service an e-mail server, which would directly impact their margin, and ultimately, their covariant pay. This was a very effective IS solution to the lack of centralization problem the business had. Oracle would continue to centralize the business by pull human resources, legal, sales administration, and marketing out of each country office staff and consolidating them at Redwood Shores.Oracle now had a single system that served everything. Oracle saved a lot of wasted money by centralizing its marketing department. The products were the same in every country, so the centralization made sense and w as absolutely necessary. By June of 2000, Oracle had gone from 63 to 17 company websites worldwide. By August 2000, the company was down to one website, Oracle. com. This solution saved the company a lot of money that was be wasted operating multiple websites for multiple countries and confusing the brand with different languages, colors, and logos.The transformation to e-business saved Oracle a ton of money, but this wasnt the only benefit of the move. The switch also generated marketing pull. Oracles customer base grew as a result of having better information about their customers and sales outlets. The pull strategy came to fruition by two combining factors. The story of the companys transformation combined with the new gained credibility the company received by performing this transformation so publicly.Now instead of sales reps attempting to sell the CEO of another company their software, CEOs were going directly to Oracle technology to transform their own businesses. This pu ll allowed Oracle to open an online store, as opposed to hiring more than than sales people to handle the increased demand. This latest IS solution, in turn, created more sales. In 1999, Oracle began streamlining its Oracle University, which supported 2500 full-time employees in 143 countries plot of ground enrolling about 500,000 students annually.These Oracle courses led to the support of developers and programmers that the company needed to continue growth. This business solution was yet another great move knowing to farm their own employees. iLearning technology was then created as a factor of a continuing education extension to Oracle Universitys certification process. This software would be hosted online and could be updated daily without patches. Oracle Corporation is a great example of a company who had the ability to predict the time to come of technology and make innovations to lead the industry. They took assays, and they paid off.Larry Ellison took a big risk when he eliminated all non-e-business elements out of his business and made the transformation to e-business, and his company was rewarded with tremendous cost savings and higher revenues. He also predicted at the end of a June 2000 press conference that the software industry would evaporate and be replaced by a service industry. This remains to fully be seen, but it appears there could be truth to this. Cloud computing has been the next innovation in computer technology, as we say many companies now providing services that used to require us to install software on our computers.